Marketing Question

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Ybyb999

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Arizona State University

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Please read the case I did attach the PDF file for it, Called Land and Nature Jerky Case, and then answer all Case Questions (the questions' file are also attached).

  1. Explain the basic facts of the case – the central character, the decision to be made, and what needs to be done before making a decision.
  2. Prepare a SWOT analysis for L&N.
  3. By dividing revenue by costs, Ayers calculated incremental revenue-to-cost in 2018 and 2019 to be $4.65:1 for trade promotions and $3.65:1 for consumer promotions. What does this tell you about the effectiveness of L&N promotions compared to industry averages?
  4. At the end of the case, Ryan proposes 3 options:
  5. Based on the financial and strategic implications, what do you recommend?

Note: you should assume the key details in the case are accurate (e.g., the U.S. meat jerky industry will remain stable, forecasts for market and industry growth are accurate, the market research data from the consumer survey are accurate, L&N’s saving estimates from outsourcing a portion of its paid and owned media and Steve Ham’s financial estimates are all accurate.

(1) decrease promotions spending by 30%

(2) increase consumer promotions by $200,000 or

(3) increase trade promotions by $200,000.

For the 3 alternative scenarios, Ryan has instructed Ayers to assume a 30% gross margin, a $500,000 budget for paid & owned media, $920,000 for wages and $280,000 for G&A costs. Using Ryan’s instructions, the forecasted income statement (Exhibit 1), expected changes to spending on paid and owned media, and L&N’s revenue-to-cost rations, Ayers forecasted operating profits for each option described in the case (below). What are the financial and strategic implications of each option?

Decrease promotion spending by 30%

Increase consumer promotions by $200K

Increase trade promotions by $200K

Revenue

$9,623,500

$11,210,000

$11,410,000

Gross profit (30%)

$2,887,050

$3,363,000

$3,423,000

Fixed Costs

$2,190,000

$2,600,000

$2,600,000

Operating profit

$697,050

$763,000

$823,000

Unformatted Attachment Preview

AGB 321 Land and Nature Jerky Case Questions 1. Explain the basic facts of the case – the central character, the decision to be made and what needs to be done before making a decision. 2. Prepare a SWOT analysis for L&N. Note: you should assume the key details in the case are accurate (e.g., the U.S. meat jerky industry will remain stable, forecasts for market and industry growth are accurate, the market research data from the consumer survey are accurate, L&N’s saving estimates from outsourcing a portion of its paid and owned media and Steve Ham’s financial estimates are all accurate. 3. By dividing revenue by costs, Ayers calculated incremental revenue-to-cost in 2018 and 2019 to be $4.65:1 for trade promotions and $3.65:1 for consumer promotions. What does this tell you about the effectiveness of L&N promotions compared to industry averages? 4. At the end of the case, Ryan proposes 3 options: (1) decrease promotions spending by 30% (2) increase consumer promotions by $200,000 or (3) increase trade promotions by $200,000. For the 3 alternative scenarios, Ryan has instructed Ayers to assume a 30% gross margin, a $500,000 budget for paid & owned media, $920,000 for wages and $280,000 for G&A costs. Using Ryan’s instructions, the forecasted income statement (Exhibit 1), expected changes to spending on paid and owned media, and L&N’s revenue-to-cost rations, Ayers forecasted operating profits for each option described in the case (below). What are the financial and strategic implications of each option? Decrease promotion spending by 30% Revenue $9,623,500 Increase consumer promotions by $200K $11,210,000 Gross profit (30%) $2,887,050 $3,363,000 $3,423,000 Fixed Costs $2,190,000 $2,600,000 $2,600,000 $697,050 $763,000 $823,000 Operating profit 5. Based on the financial and strategic implications, what do you recommend? Increase trade promotions by $200K $11,410,000
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Explanation & Answer

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1

Land and nature jerky case study

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2

Land and nature jerky case study
1. Explain the basic facts of the case – the central character, the decision to be made and
what needs to be done before making a decision.
The case is about a company called Land and Nature Jerky that sells beef jerky (Alkhaledi,
2019). The company is considering whether to sell its products in bulk to a major retailer. The
decision to be made is whether to sell the products in bulk to the retailer or to continue selling
them through other channels. Before making a decision, the company needs to consider the
financial implications of selling in bulk to the retailer.
2. Prepare a SWOT analysis for L&N. Note: you should assume the key details in the case
ar...


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