Zoecon Corporation - Strike Roach Ender :: Case Study, solution

ToExecutive, Zoecon CorporationFrom DateThursday, February 17, 2005Subject stumble band Ender IntroductionProjected IndustryConsumersProfessionalProjected growth Rate of 10% annuallyProjected growth rate of 8% annuallyProjected sales of $4.4 million Projected sales of $2.7 zillion Flea IGR Introduction Similar ScenarioGreat success of introduction of flea IGR PRECOR into PCO, veterinary and fondle store foodstuffs.In 1980 Zoecon broke into the super commercialize segment by selling the PRECOR divisor to its competitor dConIn early 1983 Flea Ender (using PRECOR) was introduced to supermarkets by Zoecon 11 % of the market was captured by late 1983Flea Enders success attributed to a second tertiary party competitor S.C. JohnsonBy 1985 Strike Flea Ender had captured 18% of the flea pesticide market and continues to turn over its profit objectiveConsumer Test merchandise AnalysisZoecons introduction of the Strike Roach Ender has captured a substantial portion of the rise are a household market segment. As seen in Table A the brand was recognized by over half of the households in the market and 6 %,( 70,200 households) of those households purchased the brand, resulting in a profit of $ 247,180.40. Though repeat purchases were also high at 30% (21,060 households) the profit generated was not enough to deliver a revenue in the trial market. Zoecon ended the market in a net loss of $$1,230,819.40. Figures are further broken lot in Table A.Contribution margins were also high for Strike Roach Ender. aerosol container Strike had a contribution margin of 55.1% and fogger had an even high margin of 57% as seen in Table B.Table C projects the break even compend in both units and dollars as a basis for further projections. As seen in Table C good larger sales are required to break even.Industry Market AnalysisUsing the techniques from the footrace market estimates of market share and communicate sales for the 19 city (80% of trial insecticide volume) are do for the introduction of Strike Roach Ender into the household market. I also chose to increase the advertising budget by 20% which increased costs to upwardly of $12 million. This further drove the net loss to a utmost projection of $6,844,476 as seen in Table D. Much like the test market Contribution margins were also high for Strike Roach Ender. Aerosol and fogger Strike had a contribution margin exceeding 50% as seen in Table E.Table F projects the break even analysis in both units and dollars as a basis for further projections.