Fratelli Carli: Growth Options for a Family Business - Case Study Example

Fratelli Carli: Growth Options for a Family Business Executive summary Fratelli Carli Olive Oil Company is a family business that is facing numerous operational challenges. After more than a century of profitable operation, the company must strategize it operations and marketing features in order to maintain a sizable market share. The business plan below therefore investigates the market in which the company operates with the view of establishing the most desirable undertakings that may not only revive but also to also increase the company’s market share. In doing this, the plan carries out extensive market analysis, market research and SWOT analysis among other features of both the company and the market in order to develop effective marketing plan. The company has two hundred and fifty employees a feature that quantifies the company as a medium sized business. As a family business, the management of the company must therefore invest in effective marketing practices in order to sustain the operations and longevity of the company in the changing market. Table of Contents Executive summary 1 Table of Contents 2 Introduction 3 Situation analysis 3 Market summary 3 Market demographics 4 SWOT analysis 4 Marketing strategy 5 Marketing mix 6 Financials 6 Controls 7 Work cited 8 Introduction Marketing refers to a management function mandated with the determination, anticipation and satisfaction of the market demand in a company. This implies that marketing is an important function in the company since it informs the production and sales departments depending on the forces of supply and demand both of which changes and is dependent on each other. Fratelli Carli Olive Oil Company has stayed operational for the last one hundred years a feature that depicts the effectiveness of the marketing departments. A marketing plan is an essential tool in the marketing practice since it informs the department on various undertaking often postulating the likely outcomes of every undertaking. Situation analysis Market summary In marketing, the noun market refers to both the geographical location in which the company sells its products and the demand for the particular product or service. Fratelli Carli Olive Oil Company has operated in Italy for the last hundred years and is currently looking for oversees opportunities. This depicts a dynamic nature of the market as the company strives to stay afloat in the perilous market. Demand for the oil products in Italy has remained substantial for the last century thereby resulting in the company’s active operations. The company must therefore determine insatiable demand for the products and beat the rising competition in order to stay operational. This explains the desires of the company to expand its markets by accessing foreign markets a feature that may result in increased demand for the products. However, an increase in the market would increase the cost of doing business owing to other subsidiary services that facilitate the transfer of goods across borders. Market demographics Italy has changed within the last hundred years within which the company has operated in the market. As the economy developed, the purchasing power of the populace increased possibly increasing demand for olive oil thereby influencing the growth and sustained operations of the Fratelli Carli Olive Oil Company. The mountainous terrains coupled with the warm temperatures in the country are among the demographic factors that influenced the operations and growth of the company. The rapid growth of the cities in the country has facilitated the growth in demand as groves have reduced in size while the urban population has increased. This implies that Fratelli Carli Olive Oil Company requires effective marketing strategies in order to keep up with the new features of the market. SWOT analysis Among the key strengths of Fratelli Carli Olive Oil Company is its longevity and large size. With more than two hundred and fifty employees and more than one hundred years of operations in the country, Fratelli Carli Olive Oil Company has enough experience and expertise in the industry to implement effective marketing strategies capable of overcoming the changing market. With the two, the company can comfortably conduct effective market researches and therefore implement appropriate marketing strategies to safeguard the profitability of the company despite the lean market. Through market researches, the company will understand the nature of the relationship between demand and supply in the market thereby implements appropriate marketing strategies to safeguard the interests of the company. The company’s greatest weakness is its marginal expertise in the intricate of the international markets. Despite having stayed operational for more than a hundred years, Fratelli Carli Olive Oil Company operated only in Italy. This implies that the company lacks information of other countries and may not therefore implement effective marketing strategies in such new markets. The market presents myriad opportunities for Fratelli Carli Olive Oil Company. By eying the international market, Fratelli Carli Olive Oil Company stands to benefit from a wider market and therefore may benefit from increased profitability. This will however compel the company to carry out appropriate market researches and therefore implement cost effective marketing strategies. The greatest threat to this move however remains competition. Several small size businesses have occupied various olive oil markets internationally. This implies that Fratelli Carli Olive Oil Company will face intense competition from small-scale local companies a feature that requires cautious investment especially in unknown foreign markets. Marketing strategy The company seeks to employ various suitable marketing strategies that will safeguard the longevity and profitability of the company. The company will carry out extensive market researches in both the local and international markets before making any marketing decisions. The company will carry out extensive media campaigns in order to improve the reputation of its products among the target markets. Additionally, the company will carry out various social corporate responsibilities, which will help improve the reputation of the company among the target markets. Besides the conventional media such as television and radio, the company will also use the social media to increase its brand awareness in both the local and international markets. Such social networking sites as Facebook and Twitter have revolutionized marketing as they offer marketers with personalized contacts with the target markets. The social media provide effective platforms for the marketers to carry out extensive market researches. Marketing mix The marketing mix is yet another instrumental tool used by marketers to determine markets and sustain the operations of the company is such markets. The tool analyses four fundamental elements including the price of the commodity, the product itself, the place and the promotional features. Effective consideration of the above factors results in profitable operations of the company in the targeted market. The price should for example sustain the manufacturing costs, cater for the logistics and retain the profit desired by the manufacturer. Sustained profitability of the company results in growth as the company reinvests the accumulated profits (Kotler, Kevin, Mairead and Torben 43). Financials The breakeven point refers to the amount of products a company needs to sell in order to earn sufficient revenue to cater for all its operations and earn a profit. Fratelli Carli Olive Oil Company must sell about a three million units of the products in the local market in order to sustain its operations and make substantial profits. The company seeks to diversify its operations by venturing into new markets in a bid to grow its operations. This implies that the company will demand a higher breakeven point of more than seven million units depending on the markets targeted. The company requires an annual revenue of about fifteen million pounds in order to sustain its operations and make substantial profits in the local market. The volume of units sold corresponds with the growth pattern the company has enjoyed in the past five years. with a sales forecast of about eleven million units annually, the company’s expenses will equally increase owing to the new logistical needs which will cost the company about six million pounds. Controls The controls in the marketing plan will help monitor the implementation process thereby cushioning the process from incurring unnecessary loses. The marketing plan for example has a contingency plan to help the company overcome any unexpected feature in the market. Any sudden dipping or a financial crisis may have undesirable effects on the company’s marketing plan. Such require effective contingency plan that will help control the supply in order to meet the shifting demands thereby cushioning the company from incurring loses. The company may also face several difficulties emanating from the dynamic economic policies in the country. The company will need to hire more employees a feature that may prove costly owing to the stringent labor and remuneration laws in the country. Work cited Kotler, Philip, Kevin L. Keller, Mairead Brady, Malcolm Goodman, and Torben Hansen. Marketing Management 2nd Edition. Pearson: Prentice Hall, 2012. Print. Read More