在尼加拉瓜馬拿瓜市開設Alfresco有機沙拉醬公司 - 政大學術集成

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(1)國立政治大學商學院國際經營管理英語碩士學位學程 International MBA Program College of Commerce National Chengchi University. Master’s Thesis. 學. ‧ 國. 立. 政治大碩士論文. ‧ y. Nat. er. io. sit. 在尼加拉瓜馬拿瓜市開設Alfresco有機沙拉醬公司 a. n. v l C Dressings in Managua, Alfresco Organic Salad Nicaragua ni hengchi U. Student: Xaviera L. Aguilar Sevilla Advisor: Professor Glen Brodowsky. 中華民國一○五年五月 May 2016.

(2) 在尼加拉瓜馬拿瓜市開設Alfresco有機沙拉醬公司 Alfresco Organic Salad Dressings in Managua, Nicaragua. 研究生：顏莎. Student: Xaviera L. Aguilar Sevilla. 指導教授：白德傑. Advisor: Professor Glen Brodowsky. 立. 政治大. 國立政治大學. ‧ 國. 學. 商學院國際經營管理英語碩士學位學程碩士論文. sit. y. ‧. Nat. A Thesis. a. er. io. Submitted to International MBA Program. n. National Chengchi University iv l. n U e n gofcthe h iRequirements in partial fulfillment. Ch. for the degree of Master in Business Administration. 中華民國一○五年五月 May 2016.

(3) Abstract Alfresco Organic Salad Dressings in Managua, Nicaragua By Xaviera L. Aguilar Sevilla Alfresco LLC is a startup business based in Managua, Nicaragua. The aim of Alfresco is to help. 治政 quality products with no sugar added and free of lactose大 and gluten. 立. create healthy nutrition habits in Central America’s homes by providing fresh, organic, high. ‧ 國. 學. The salad dressing industry in Nicaragua is relatively mature and it’s characterized by a medium level of fragmentation. However, organic salad dressings are currently inexistent, therefore, this. ‧. would be a disruption in the lifecycle of the industry. Moreover, since there are no competitors. sit. y. Nat. in the organic segment, there is a market gap that has not been covered yet; that is exactly the. n. al. er. io. segment that Alfresco will target.. Ch. i n U. v. An initial investment of $4,362 is required to start the business. As shown in the financial. engchi. section, we forecast to recover the investment in year 3.. One important risk is the fact that there are a lot of substitutes for salad dressings. However, the busy consumers’ lifestyle backed with the heavy advertising efforts and the high quality of our product, will help us overcome this obstacle and succeed in the industry.. Overall, we believe that there is a big opportunity in this industry and we expect to break even before the forecasted time.. Keywords: (Organic), (Salad Dressings), (Organic Food Industry). i.

(4) TABLE OF CONTENTS 1.. COMPANY OVERVIEW................................................................................................ 1 1.1.. MISSION ...................................................................................................................... 1. 1.2.. VISION ......................................................................................................................... 1. 1.3.. OBJECTIVES ................................................................................................................. 1. 1.3.1. General ................................................................................................................... 1. 政治大 ............................................................................................... 1. 1.3.2. Specific ................................................................................................................... 1. 立. KEY SUCCESS FACTORS. 1.5.. BRAND AND PRODUCT OVERVIEW............................................................................... 2. ‧ 國. 學. 1.4.. 1.5.1. Logo ........................................................................................................................ 2 COMPANY OWNERSHIP ................................................................................................ 3. y. Nat. io. 2.1.. sit. BUSINESS ENVIRONMENT ......................................................................................... 3 INDUSTRY OVERVIEW.................................................................................................. 3. n. al. er. 2.. ‧. 1.6.. Ch. i n U. v. 2.1.1 Global Trends ............................................................................................................ 5 2.2.. engchi. NICARAGUAN MARKET ............................................................................................... 7. 2.2.1. Economy ................................................................................................................. 7 2.2.2. Socio-Demographics .............................................................................................. 9 2.2.3. Central American Common Market (CACM)....................................................... 10. 3.. 2.3.. COMPETITORS ............................................................................................................ 11. 2.4.. BUSINESS OPPORTUNITY ........................................................................................... 12. BUSINESS MODEL ....................................................................................................... 14 3.1.. VALUE PROPOSITION ................................................................................................. 14. ii.

(5) CUSTOMER SEGMENTS .............................................................................................. 14. 3.3.. CHANNELS ................................................................................................................. 15. 3.4.. CUSTOMER RELATIONSHIPS....................................................................................... 15. 3.5.. REVENUE STREAMS ................................................................................................... 15. 3.6.. KEY PARTNERS .......................................................................................................... 15. 3.7.. KEY ACTIVITIES ........................................................................................................ 16. 3.8.. KEY RESOURCES ....................................................................................................... 16. 3.9.. COST STRUCTURE ...................................................................................................... 16. 立. 政治大. MARKETING PLAN ..................................................................................................... 18. 學. ‧ 國. SELLING PROPOSITION ............................................................................................... 18. 4.2.. TARGET MARKET ....................................................................................................... 18. 4.3.. CONSUMER BEHAVIOR .............................................................................................. 18. 4.4.. PRODUCT ................................................................................................................... 20. ‧. 4.1.. io. sit. y. Nat. er. 4.. 3.2.. 4.4.1. Package ................................................................................................................ 21. al. n. v i n Competitive advantage 22 C h......................................................................................... engchi U. 4.4.2. 4.5.. PRICING AND POSITIONING STRATEGY ...................................................................... 22. 4.5.1. Positioning map .................................................................................................... 22 4.6.. DISTRIBUTION PLAN .................................................................................................. 24. 4.7.. PROMOTION STRATEGY ............................................................................................. 26. 4.7.1. Pull Marketing. ..................................................................................................... 26 4.7.2. Push Marketing .................................................................................................... 27 4.8.. ONLINE MARKETING STRATEGY ............................................................................... 27. 4.8.1. Content Marketing ................................................................................................ 27. iii.

(6) 4.8.2. Email Marketing ................................................................................................... 28 4.8.3. Social Media Marketing ....................................................................................... 28 5.. STRATEGIC PLANNING ............................................................................................ 30 5.1.. EXTERNAL ANALYSIS ................................................................................................ 30. 5.1.1. Porter’s Five Forces Analysis .............................................................................. 30 5.1.2. Industry Life Cycle Analysis ................................................................................. 31. 政治大 C. 5.1.3. Macro Environment .............................................................................................. 32 INTERNAL ANALYSIS (COMPETENCIES AND. 5.3.. SWOT MAP .............................................................................................................. 33. 5.4.. BUSINESS LEVEL STRATEGY...................................................................................... 34. 立. OMPETITIVE ADVANTAGE) .................. 33. ‧. ‧ 國. 學. FUTURE OPPORTUNITIES........................................................................................ 36. Nat. PRODUCT DEVELOPMENT .......................................................................................... 36. y. 6.1.. sit. 6.. 5.2.. n. al. er. io. 6.1.1. Line Extension ...................................................................................................... 36. i n U. v. 6.1.2. Brand Extension ................................................................................................... 36 6.2. 7.. Ch. engchi. MARKET DEVELOPMENT ........................................................................................... 37. FINANCIAL PLAN ........................................................................................................ 38 7.1.. START-UP BUDGET ................................................................................................... 39. 7.2.. PROJECTED INITIAL BALANCE SHEET ........................................................................ 40. 7.3.. INCOME STATEMENT ................................................................................................. 41. 7.4.. CASH FLOW ............................................................................................................... 42. 7.5.. PROFITABILITY ANALYSIS ......................................................................................... 43. 7.5.1. Net Present Value and Internal Rate of Return .................................................... 43. iv.

(7) 7.5.2. Break Even Analysis ............................................................................................. 44 8.. CONCLUSION ............................................................................................................... 45. 9.. BIBLIOGRAPHY ........................................................................................................... 46. 10. APPENDIX ..................................................................................................................... 49 10.1.. STARTUP COSTS DETAILS .......................................................................................... 49. 10.2.. MARKET SHARE AND SALES FORECAST .................................................................... 50. 10.3.. AMORTIZATION TABLE .............................................................................................. 51. 10.4.. DEPRECIATION TABLE ............................................................................................... 53. 立. 政治大. ‧. ‧ 國. 學. n. er. io. sit. y. Nat. al. Ch. engchi. v. i n U. v.

(8) List of Figures Figure 1. Alfresco Company Logo ............................................................................................. 3 Figure 2. Sales of the leading shelf stable pourable salad dressing brands of the United States in 2013 (in million U.S. dollars) ......................................................................................... 4 Figure 3. Nicaragua Gross Domestic Product (Purchasing Power Parity) 1999- 2013 .............. 8. 政治大. Figure 4. GINI Index in Nicaragua 1992, 1998, 2001, 2004 .................................................... 10. 立. Figure 5. Income Share Held by Highest 10% in Nicaragua 1992, 1998, 2001, 2004 ............ 10. ‧ 國. 學. Figure 6. CDM Modified for EPS ............................................................................................ 19. ‧. Figure 7. Product Package Example ......................................................................................... 21. y. Nat. al. er. io. sit. Figure 8. Perceptual Positioning Map ..................................................................................... 23. v. n. Figure 9. Super Porta’s location – Villa Fontana Branch ......................................................... 24. Ch. engchi. i n U. Figure 10. Stop ‘n Go Location ................................................................................................ 25 Figure 11. Porter’s Five Forces Analysis .................................................................................. 30 Figure 12. Salad dressings and Organic Salad Dressings Life Cycle in Nicaragua ................. 32 Figure 13. Alfresco Organic Dressings SWOT Map ................................................................ 33. vi.

(9) List of Tables Table 1. Refrigerated Salad Dressings Sales in the US 2009 - 2013 (Driggs, 2014) ................. 6 Table 2. Nicaragua Gross Domestic Product 2010 - 2015 ......................................................... 8 Table 3. Competitors’ Brands Sorted by Price from High to Low ........................................... 12 Table 4. Initial Investment Summary ....................................................................................... 39. 政治大. Table 5. Alfresco LLC Initial Balance Sheet ............................................................................ 40. 立. Table 6. Yearly Estimated Income Statement Projections ........................................................ 41. ‧ 國. 學. Table 7. Yearly Estimated Statement of Cash Flow ................................................................. 42. ‧. Table 8. Alfresco LLC Profitability Analysis: Net Present Value and Internal Rate of Return 43. y. Nat. n. al. er. io. sit. Table 9. Alfresco LLC Break Even Analysis ............................................................................ 44. Ch. engchi. vii. i n U. v.

(10) 1. Company Overview 1.1.. Mission. Alfresco offers healthy and convenient food solutions in Central America with emphasis in natural and organic, while creating a healthy work environment with opportunities for our people to develop, and a steady market growth and market penetration in the region.. 1.2.. Vision. Become the leader in the organic food industry in Central America by providing high quality and unique products to the right customers, at the right price.. 1.3.. Objectives. 立. 1.3.1. General. 政治大. Position ourselves as the number one company in the organic food category.. . Build a strong brand image in the early stage of the company in order to create customer. ‧ 國. 學. . . ‧. loyalty and to be able to do a successful product line extension in stage two. Ensure that Alfresco becomes a profitable company with an investment recovery period. y. Nat. er. io. 1.3.2. Specific. sit. of less than three years.. al. n. v i n Ch hypermarkets after having succeeded i U stores. e n gincthehupscale. . By the end of year one, expand the distribution coverage and be able to enter the. . By year two, enter the market of ready to eat food with lunch size salads that are accompanied by Alfresco vinaigrettes and backed by Alfresco brand image. At the same time, expand the initial market (Managua) to other important cities in the country such as Granada, Chinandega, León, Estelí and Matagalpa.. . By year three, expand the initial market (Nicaragua) to two other geographic areas: El Salvador and Costa Rica.. 1.4.. Key Success Factors. Customer Relationship. In Alfresco, we want to build strong customer relationships in order to make sure that our customer base becomes loyal to our brand. In this manner, if a competitor decides to enter the market, it will be more difficult for them to steal market share by diverting. 1.

(11) sales from our brand. We want to listen to our customers’ needs and feedback in order to adapt our flavors and products to their preferences. At the same time, we want to be a company that even when it is part of a “boring industry”, characterizes itself by being creative and innovative, keeping up with the changing consumer preferences and behavior. Strong Brand image. We believe that the brand image is one of the most important assets that our company will have. From the beginning, we will work on creating a strong brand image that will allow us to expand to different markets and introduce new product lines. Social Media Expertise. This will allow us to build our brand image, promote our products. 政治大. and create a strong customer relationship. At the same time, we will be able to make use of the organic reach of our posts and word of mouth to decrease the advertising expenditure.. 立. Quality focus. Alfresco, unlike the existing brands, will not sacrifice the quality of the products. ‧ 國. 學. by using low quality ingredients. Because our products will be sold at a price premium, we will only use top quality ingredients that will guarantee our final product’s quality and consumer. Brand and Product Overview. sit. y. Nat. 1.5.. ‧. satisfaction.. io. er. Alfresco is a word in Italian that means outdoors. Every time we think about outdoors we think of nature, sunshine and happy moments. That is what we want the brand to be in the mind of. n. al. i n U. v. consumers. Alfresco will offer fresh, natural and organic products to consumers that are looking. Ch. engchi. to take care of their health, without sacrificing good flavor and convenience. In Spanish “fresco” means fresh, and that is the essence of what the brand will offer to the market. At the beginning, we will offer salad dressings and vinaigrettes that will use olive oil as a base and will only make use of organic ingredients and natural preservatives. In the second stage of the start-up, we will offer ready to eat salads for the busy healthy consumer who do not have time to lose in the kitchen but is concerned about their health.. 1.5.1. Logo The following is our proposed logo, however, we will test it with potential consumers before launching the product in order to measure their acceptance.. 2.

(12) 政治大. 立. ‧ 國. 學. Company Ownership. ‧. 1.6.. Figure 1. Alfresco Company Logo. y. Nat. The company will be a Limited Liability Company (LLC) because of the advantages that this. io. sit. type of ownership represents. It will be distributed in a 60%/40% split between its two owners.. n. al. er. Xaviera Aguilar. MBA graduate with a bachelor in International Business, five years working. i n U. v. experience in marketing, customer service and logistics in the wholesale and online marketing industries.. Ch. engchi. Teresa Sevilla. MBA graduate with a bachelor in Architecture and more than 30 years working experience in project management and managing personnel, and practical experience in the retail business through family businesses.. 2. Business Environment 2.1.. Industry Overview. Obesity is one of the biggest health problems in the world. It is, together with overweight, the fifth leading risk for global death (EASO, 2015). Since 1980, the percentage of the worldwide population that is obese has more than doubled, reaching 13% in 2014 (WHO, 2015). In Latin. 3.

(13) America the numbers are even more drastic, where almost a 30% of the population is obese (Moloney & Arsenault, 2013). Because of this, people are getting more health conscious and have begun to change their diets and include more vegetables and salads. Traditional salad dressings have historically been the perfect companion for salads, as vegetables by themselves do not have an appealing taste for many consumers. The consumption of salad dressings is so big, that the global market for salad dressings amounted to 24 billion US dollars in 2010 (RTS, 2011). In United States alone, the Top 10 Brand’s Sales were 1.7 billion US dollars in 2013.. Sales millions 政 in治. 大. 立. Maple Grove Farms of Vermont Girard's. ‧ 國. 學 ‧. Marzetti Olive Garden Brianna's Newman's Own Ken's Steak House Wishbone Private label. Nat. 100. 150. n. al. 50. Ch. 200. 250. 300. er. io. 0. sit. y. Kraft Hidden Valley Ranch. i n U. 350. 400. 450. v. Figure 2. Sales of the Leading Shelf Stable Pourable Salad Dressing Brands of the United States in 2013 (in million U.S. dollars)1. engchi. However, different studies have recently demonstrated that those traditional dressings are not good for our health. Most of them are prepared with canola oil, corn oil, or vegetable oil and add sugar among their ingredients. All of this can make a single portion of salad to have more calories than a Big Mac burger (Shape, 2016). As a result, many nutritionists are recommending their patients not to add salad dressing to their salads or to limit themselves to add olive oil and vinegar or lemon. Another problem with the traditional salad dressings is that they have a high content of polyunsaturated fats, which prevent our bodies from absorbing all kinds of fats, even the good. 1. Source: http://www.statista.com. 4.

(14) ones. A study conducted by Dr. Mario Ferruzzi from Purdue University, showed that monounsaturated fat-rich dressings, such as olive oil-based dressings, promote a higher absorption of carotenoids (Wallheimer, 2012), which act as antioxidants, anti-inflammatory and some of them are converted by the body to Vitamin A. According to Dr. Ferruzzi "…if you want to utilize more from your fruits and vegetables, you have to pair them correctly with fatbased dressings. If you have a salad with a fat-free dressing, there is a reduction in calories, but you lose some of the benefits of the vegetables." Therefore, fattening dressings defeat the purpose of eating “healthy” salads.. 2.1.1 Global Trends. 政治大 this trend of “counting calories”, 立 many of the most important brands in the Food Industry Many consumers have mistakenly confused eating healthy with reducing calories. Because of. ‧ 國. 學. extended their product lines by creating light or fat free versions of their main products. By 1990, light salad dressings accounted for one third of the market total sales (Altschul, 1993). But again, these light salad dressings still used highly caloric sweeteners and achieved the. ‧. reduction in calories by reducing fat. This in turn, would translate in a low absorption of. sit. y. Nat. vitamins and other nutrients as mentioned before.. io. er. Because of the use of internet and more access to information, consumers have recently realized the damage that these light and regular salad dressings can have for their health. As a result,. n. al. Ch. i n U. v. they have reduced the consumption of light salad dressings and instead, started to demand all-. engchi. natural and even organic products (Early, Holcomb, Willoughby, & Brooks, 2005). Refrigerated natural/organic dressings From 2009 to 2013 the refrigerated salad dressing sales in United Stated have grown an average rate of 6% per year (See Table 1), almost three times the growth rate of the traditional type. The refrigerated category includes natural and organic salad dressing or vinaigrettes with no preservatives added or with natural preservatives. Many of these contains ingredients such as different types of cheese, garlic, herbs and natural lemon juice.. 5.

(15) Table 1. Refrigerated Salad Dressings Sales in the US 2009 - 2013 (Driggs, 2014) Refrigerated Salad Dressings in the US Sales (millions) %Sales Change 336 6 2013 315 7.6 2012 294 7.3 2011 274 3.5 2010 264 Na 2009. Greek yogurt based. 政治大. Ranch salad dressing has been a top seller in the industry worldwide, especially in United States, where it is the number one flavor preferred by consumers. However since the 1994 Labelling. 立. law, consumers started to realize that it is a high fat dressing and sales started to decline. In. ‧ 國. 學. order to counter this effect, the ranch dressing makers began substituting their original ingredients with Greek yogurt in order to make the dressing a healthier option.. ‧. At the same time, they introduced additional ranch flavors such as Honey BBQ Ranch, Avocado Ranch, Roasted Garlic Ranch, Buffalo Ranch, Cilantro Lime Ranch and more (Hidden Valley,. io. sit. y. Nat. n.d.).. er. Besides the Ranch flavor, companies like Litehouse are also using Greek yogurt for dressings. al. n. v i n C hcalories and an increase ingredient creates both a reduction in e n g c h i U in proteins, which is essential if such as Caesar, Strawberry Poppyseed, Avocado Cilantro, etc. The use of Greek yogurt as an. consumers are pursuing a vegetarian diet. Low caloric sweeteners. As previously mentioned, a special concern about light dressings is that they are achieving the low calorie count due to a reduction in fat. Currently, some brands are substituting sugar for other lower caloric sweeteners such as stevia, agave or Splenda. This not only attracts customers looking for low calorie dressings but also attracts diabetics, who cannot consume the regular dressings with big amounts of sugar added.. 6.

(16) Do-it-yourself vinaigrettes Another trend that has emerged in almost every industry is the DIY market segment. With internet access to recipes, tutorials, forums, etc. everyday there are more consumers that prefer preparing their vinaigrettes at home. The classic one – olive oil and vinegar – takes less than five minutes to prepare and it is cheaper and healthier that what you could find at the supermarkets. The middle guys Because of all these changes in the industry and in consumer preferences, the historically big. 政治大 significantly . According to an article by Annie Gasparro published in WSJ (Gasparro, 2013) 立 private-label dressings are taking the budget-conscious consumers and the new brands with players such as Kraft and Wishbone have seen their sales and market share decrease 2. ‧ 國. 學. fresh offerings are taking away the high end shoppers. Private-label dressings are entering a price war with prices as low as 1USD per bottle, and budget conscious consumers – who started. ‧. consuming these brands after the 2008 financial crisis – cannot find a difference between these dressings and the ones they bought before.. y. Nat. io. sit. As a result and in order to avoid entering the price war, many of the “middle guys” have. er. developed new flavors as an intent of gaining back part of the already lost market share.. a. n. 2.2.. l C Nicaraguan Market. hengchi. i n U. v. Nicaragua is a Latin American country located in the center of Central America with a total area of 130,375km2, making it the largest country in the Central American region. It is bordered on the north by Honduras, on the south by Costa Rica, on the west by the Pacific Ocean and by the Caribbean Sea to the east.. 2.2.1. Economy There are still some people in the world that when they think of Nicaragua they think of the Sandinista Revolution and war. However, since 2010 Nicaragua has experienced sustained. 2. Wish-Bone's market share fell to 9.1% last year from 10.6% five years before, while Kraft's share dropped to 19.6% from 25.1%.. 7.

(17) economic growth as a result of the effective implementation of its fiscal, financial, monetary and exchange policies. Furthermore, just recently, at the end of March 2016, the International Monetary Fund (IMF) announced that they will close the office in Nicaragua in the face of the country’s “heartening economic growth” (Associated Press, 2016). According to the IMF representative in the country, the close of the office “reflects the success Nicaragua has had in maintaining macroeconomic stability and growth”. Table 2 shows Nicaragua’s main macroeconomic figures from 2010 to 2015.. 政治大 2010 2011 2012 2013 立8,741 9,756 10,439 10,875. Table 2. Nicaragua Gross Domestic Product 2010 - 2015. 6.20% 1626.9. 5.60% 1719.5. 4.50% 1772.8. 2015 12,693 4.90% 2026.7. ‧. ‧ 國. 3.20% 1475.8. 學. GDP (Millions of US$ ) GDP Growth GDP Per Capita (US$). 2014 11,790 4.60% 1902.2. Despite the sustained economic growth, the GDP Per Capita might still seem low in order to. Nat. sit. y. estimate the demand and the capacity for consumers to purchase our products. However, in. io. er. order to analyze the consumers’ purchasing power the number that we have to look at is the Purchasing Power Parity Index.. n. al. i n U. C. v. h e n g c hPower i GDP (Purchasing Parity) 30 25 20 15 10 5 0 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013. Figure 3. Nicaragua Gross Domestic Product (Purchasing Power Parity) 1999- 2013 8.

(18) Figure 3 shows Nicaragua GDP in terms of Purchasing Power Parity from 1999 to 2013 (Index Mundi, n.d.). In the figure, we can see that the PPP has also shown a constant growth with the exception of 2007 when it decreased 6.7%. By 2013 the GDP in terms of PPP was 27.97 billion USD.. 2.2.2. Socio-Demographics Nicaragua has a population of 6.17 million people, according to the National Institute of Development Information (INIDE, for its acronym in Spanish), out of which 51 percent are female and 49 percent male (PRONicaragua, n.d.). In 2010, 58.3 percent of the population lived in urban areas and the country presented a 1.2 percent population growth rate.. 治政 In Managua, the capital, there are 2.22 million habitants 大and there are over 2.5 million in the 立 Metropolitan area. ‧ 國. 學. Nicaragua, like most Latin American countries exhibits high levels of income inequality. According to a study (Díaz Galindo, 2013) published by the Central Bank of Nicaragua, 50. ‧. percent of households represent only 19 percent of the total national income, 90 percent. y. Nat. represents 63 percent of the total national income and 10 percent of the households hold 37. io. sit. percent of the national income.. n. al. er. Furthermore, if we compare urban and rural areas, urban areas which as stated before represent. i n U. v. about 58 percent of the population, hold 75.2 percent of the total national income. And rural. Ch. engchi. areas which account for 42 percent of the population, only hold 24.8 percent of the total national income. Moreover, in urban areas 90.34 percent of households have a monthly income less or equal to US$1,268 and 9.66% have a monthly income higher than that amount per month. Taking into consideration that the GDP per capita in 2015 was US$2,026.7 per year, we can have an idea of the existing income distribution inequality in the country. Additionally, households whose head of the house has a level of education of Master degree or higher, have an average monthly income of US$2,818.19. An important indicator to look at when analyzing income inequality is the GINI Index. The Gini index “measures the extent to which the distribution of income among individuals or households within an economy deviated from a perfectly equal distribution” (Trading Economics, 2015).. 9.

(19) As we can see in Figure 4, inequality in Nicaragua has been decreasing over time. However, the Gini index still reached an elevated 40 percent in 2004, and according to a study by Gindling and Trejos (Gindling & Trejos, 2013) in 2009 it reached 53.8 percent.. 政治大. 立. ‧ 國. 學. Figure 4. GINI Index in Nicaragua 1992, 1998, 2001, 2004 Because of this income distribution inequality, even though it’s decreasing tendency, by 2004. ‧. 10 percent of the population was responsible of more than 30 percent of the total income in the country (Dávalos & Vakis, 2011).. n. er. io. sit. y. Nat. al. Ch. engchi. i n U. v. Figure 5. Income Share Held by Highest 10% in Nicaragua 1992, 1998, 2001, 2004. 2.2.3. Central American Common Market (CACM) The Central American Common Market is an association of the five Central American countries (Guatemala, El Salvador, Honduras, Nicaragua and Costa Rica) that “was formed to facilitate regional economic development through free trade and economic integration” (Encyclopedia Britannica).. 10.

(20) Currently, 96 percent of the total products traded are under free trade, with the exception of a list of products listed as an appendix on the free trade agreement.. 2.3.. Competitors. Currently, there are no direct competitors in Nicaragua who are offering natural salad dressings or vinaigrettes. Therefore, for the purpose of this business plan we will consider the regular salad dressing as our direct competitor. The brands that have the strongest presence in the Nicaraguan market are: . Wishbone is a global brand and one of the industry’s leaders. The flavors offered in. 治政大 and US$3.94 depending on size, 8oz and 16oz bottles. The prices are between US$2.07 立channel. flavor and distribution Nicaragua are: Italian Creamy, Thousand Islands, Blue Cheese, Caesar, and Ranch in 3. Kraft is also a global brand and the second with higher sales in United Sates. The flavors. ‧ 國. 學. . offered are: Thousand Islands, Creamy French, Classic Ranch, Tangy Bacon Catalina,. ‧. and Zesty Italian in 8oz and 16oz bottles with prices between US$2.05 and US$3.94, depending on size, flavor and distribution channel.. Nat. y. McCormick is the third brand with the strongest presence in Nicaragua. McCormick. sit. . er. io. covers two different market segments by offering two different packages: bottle and pouch. In the bottle package they offer the flavors: Italian, Ranch and Thousand Islands. n. al. Ch. i n U. v. in 8.36oz bottles with prices between US$2.42 and US$2.64 depending on the flavor.. engchi. In the pouches type of package they have a wider variety of flavors, including Thousand Islands, Caesar, Ranch, Italian, and Honey Mustard. The prices vary from US$0.76 to US$1.48 depending on the flavor and distribution channel. Other brands that have recently entered the market are: . Al Olivo is a Latin American brand that uses olive oil as part of its ingredients. However, in order to maintain low prices, they combine olive oil with other type of oils. The flavors of dressings offered are: Caesar and Thousand Islands in 8.47oz bottles with average prices of US$1.93.. 3. Using the official exchange rate of April 1st 2016, 1USD = C$28.2729. 11.

(21) . Delga C is a brand from Costa Rica that focuses on consumers who are on a diet and are looking to lose weight. All their dressings are fat free and they offer the following flavors: Italian, Thousand Islands, Caesar, and Ranch in 15 oz. bottles with prices between US$2.03 and US$2.42 depending on the distribution channel.. . Clemente Jacques is a Mexican brand that recently entered the Nicaraguan market. Currently, they just offer two flavors: Thousand Islands and Caesar in 16oz bottles at US$2.30 per bottle. The brand only has presence in one of the two major hypermarket chains in the country, the rest of the competitors can be found in the two chains.. . Kens Steak House is an upscale US brand that offers unique flavors at premium prices.. 治政大 16 oz. bottles at US$4.24 per bottle. 立 Campestre is a brand from Costa Rica that focuses on the low end market segment by. The flavors that they offer are: Greek, Sweet Vidalia Onion, and Sun Dried Tomato in. 學. ‧ 國. . offering all their products in pouches. The flavors that they offer are: Thousand Islands, Ranch, Caesar, and Italian with prices from US$0.95 to US$1.06.. ‧. Table 3. Competitors’ Brands Sorted by Price from High to Low. Kraft. er. al. US$2.42 to US$2.64. n. Wishbone. io. McCormick. US$4.24. sit. Ken’s Steak House. y. Price. Nat. Brand. Ch. US$2.07. e n gUS$2.04 chi. i n U. v. Size 16 oz. 8.36 oz. 8 oz. 8 oz.. Al Olivo. US$1.93. 8.47 oz.. Delga C. US$2.03 to US$2.42. 15 oz.. US$2.30. 16 oz.. Clemente Jacques Campestre. 2.4.. US$0.95 to US$1.06. Business Opportunity. After analyzing the latest industry trends and the Nicaraguan market, we determined that there is a business opportunity in the organic salad dressings market in the country. When determining this, the following aspects were taking into consideration.. 12.

(22) The middle and high class in Nicaragua follow the trends established in the developed countries, especially in the United States. As stated in the Global Trends section, consumers worldwide are shifting from the traditional processed high fat salad dressing to the fresh and natural ones. In Nicaragua there is currently no local brand for salad dressings and vinaigrettes, all are imported products from big brands such as Wishbone and Kraft. Moreover, importing fresh vinaigrettes from United States would translate into a higher cost because the expiration dates of this type of products are shorter, and most of them have to be refrigerated, which increases the transportation costs due to the type of container needed.. 政治大. At the same time, Nicaraguan consumers are becoming more health conscious every day. There are more gymnasiums, yoga and dance studios, nutritionists, etc. which means that this market. 立. segment is growing and becoming an important niche market in Nicaraguan society.. ‧ 國. 學. Moreover, Nicaragua is a country where one of the most important economic sectors is agriculture. This means that the prices of vegetables and herbs are relatively low and the quality. ‧. is high because they are not grown in an industrial way, but on small family farms.. sit. y. Nat. Additionally, the Central American Common Market constitutes a special opportunity for the Central American products because we can practically enter any market under the free trade. io. er. agreement. This would mean that instead of having a market of 6.13 million people that is. al. n. v i n C h together (Geohive, population of the five country members e n g c h i U 2012).. Nicaragua, we can eventually have access to a market of 41.89 million that is the total. Finally, consumers all over the world are becoming busier. Everyone now has access to recipes and tutorials online, but our free time is becoming everyday more valuable. And even though not all people in Nicaragua have access to internet, our target market does. Consumers want to spend their free time with their friends and families, doing things they enjoy, not in the kitchen. Because of this, the industry of prepared food, sauces and salad dressings is blooming. But now consumers not only seek convenience but also health benefits.. 13.

(23) 3. Business Model 3.1.. Value Proposition. We help create healthy nutrition habits in Central America’s homes by providing healthy and high quality products without sacrificing good taste.. 3.2.. Customer Segments. We are going to focus on a niche market comprised by consumers who have healthy eating habits, or need to follow a healthy diet. Three different segments can be identified in such category. . 政治大. Diabetics. Diabetes is a chronic disease whose numbers of patients has had a drastic. 立. increase in the last years. In Nicaragua, 1 out of every 10 people has diabetes. People. ‧ 國. 學. with diabetes are encouraged to choose a variety of fiber-rich foods, such as whole grains, fruits, and vegetables. At the same time, they have to follow a diet low in sugar since their bodies cannot process it because of the lack of insulin. However as mentioned. ‧. in the industry overview, most of the traditional salad dressings have sugar added as. y. sit. . Nat. part of their ingredients, making them not suitable for diabetics. Gluten/lactose sensitive or intolerant. In recent years, the number of people who are. io. er. gluten or lactose intolerant has been increasing throughout the world. The gluten free. al. n. v i n C segment.hCurrently, are no gluten-free e n g cthere hi U. niche market has been a growth opportunity for many brands and many others have born just to serve this. salad dressings in. Nicaragua and people who are lactose intolerant can only consume the Italian dressing since all the other dressings have lactose as part of their ingredients. . Health conscious. This is the widest segment that we are going to focus on. The health conscious consumers do not have a health condition that force them to consume certain type of food, but instead, they choose to eat healthy. These are people who eat salads and vegetables as part of their regular diet and because of the wider access to information are now trying to switch from the regular salad dressing to healthier options such as natural or organic.. Due to the fact that our product satisfies the needs of all of these segments, and some of the segments overlap with each other, we are going to focus on the three of them.. 14.

(24) 3.3. . Channels Upscale and Specialty Stores. In Nicaragua there are four main specialty stores: Stop n’ Go, Porta’s, Bavaria Delicatessen and La Familiar.. . Hypermarkets. There are two main hypermarket chains: La Colonia and Supermercados La Union. Each of them has several branches and presence in different areas of the capital. There is another hypermarket chain in the country, however since they target the low income segment of the population, it won’t be used as a distribution channel for our products.. 3.4.. Customer Relationships. 政治大. Since the sale of our product is done through third parties, we do not have a direct contact with. 立. the customers. However, we want to maintain a relationship with the customers after the. ‧ 國. . 學. purchase is made.. Community Engagement. Through social media, we want to have a two way. ‧. communication with our customers, listen to what they think about our products and what products they would like to see as part of our portfolio.. y. Nat. Email Marketing. An email marketing strategy will be implemented in order to achieve. sit. . Revenue Streamsa l. n. 3.5.. er. io. a top of mind awareness (See Online Marketing Strategy for a complete description).. Ch. engchi. i n U. v. Retail sales through upscale outlets. Since we are selling a product our only revenue stream will be through the direct sales of the dressings and vinaigrettes.. 3.6. . Key Partners Suppliers o Farmers. Because we are going to focus on fresh, natural products, the farmers are our main partners. We will establish collaboration relationships with handpicked farmers that can guarantee timely delivery of premium quality vegetables. o Other suppliers. There are other ingredients such as the olive oil and rice vinegar that will be acquired from suppliers other than the farmers. Additionally, we will have suppliers for the package and labels.. 15.

(25) . Distributors. Upscale Stores and hypermarkets where our products will be available for consumers to purchase.. 3.7. . Key Activities Manufacturing. The main activity that the company will do is the manufacturing of the products.. . Marketing. From branding and promotion, to customer relationship management, our marketing efforts are essential for the products to succeed in the market.. . Distribution. Because of the short expiration date of our products, it is essential that we maintain an effective distribution strategy in order to have the right quantity and flavors. 政治大. at the right place in the right time. . 立. Inventory Management. Again, because of the short expiration date of our products. ‧ 國. 學. and raw materials, we must be very precise at calculating the amount of raw materials that we need to order each week in order to reduce waste. At the same time, we must know the quantity demanded for our product in each of our distribution channels in. ‧. order to have the required inventory ready to restock them in a timely manner.. y. sit. Key Resources. al. n. their fresh, rich flavor and high quality. . Ch. er. Human Assets. Our personnel will be the ones responsible for our products to maintain. io. . Nat. 3.8.. i n U. v. Raw materials. The raw materials of ingredients are essential for maintaining a high. engchi. quality in the final product. We will only use premium quality raw materials in order to assure that our product meets the quality standards promised to our consumers. . Brand. Our brand will be one of our main assets. It will be a guarantee for our customers that they are buying fresh products elaborated using only organic ingredients.. . Know-how. Our recipes and the different flavors that we offer are what make us different from all the other competitors.. 3.9. . Cost Structure Relevant fixed costs.. 16.

(26)  Wages. At the beginning, one person will be hired for the kitchen and one security guard in order to protect the premises. Administrative wages are also considered.  Rent. A small house will be rented to establish the company. In here, we will locate the factory, administrative offices and warehouse.  Utilities. Telephone, water, internet and electricity expenses are considered per month  Advertising. A fixed amount will be established each month to promote posts in social media advertising. . 治政大 we will maintain an inventory Inventory. In accordance with the sales volume, 立 of raw materials for food.. Relevant variable costs. . ‧ 國. 學.  Packaging. The purchase of glass bottles will be done in bulk in order to achieve economies of scale in price and transportation costs. Economies of scale. By buying big quantities of bottles (package), and ingredients such. ‧. . as olive oil, lemon juice and vegetables.. y. Nat. sit. Economies of scope. We will maximize our relationship with the distributors by. io. offering several flavors. At the same time, the kitchen equipment purchased will be used. al. er. . n. to prepare and store all the different flavors and presentations.. Ch. engchi. 17. i n U. v.

(27) 4. Marketing Plan 4.1.. Selling Proposition. We help create healthy nutrition habits in Central America’s homes by providing fresh, organic, high quality products with no sugar added and free of lactose and gluten.. 4.2.. Target market. On the first stage of the project, we are going to focus in Managua, Nicaragua. Managua metropolitan area has a population of 2.22 Million people. According to the last national census by the National Institute of Development Information (INIDE, 2006), the average number of. 政治大. people per household in Managua is 5, which means that there are approximately 444,600. 立. households in the city.. ‧ 國. 學. A study by Adolfo Diaz (Diaz Galindo, 2013) that analyzes the life standards in Nicaragua, concludes that in 2009 8 percent of the households in Managua had an income of more than US$1,243 per month. Taking those numbers as a reference, we assume that in 2016. ‧. approximately 15 percent of the households have a monthly income of US$800 or more. We. sit. y. Nat. are going to focus on that 15 percent of the population that have the economic power to purchase. io. er. our product; this gives us a total target market of 66,690 households.. According to the same study, income is positively correlated to the level of education. Therefore,. n. al. Ch. i n U. v. we assume that all of those households have a level of education of bachelor or higher.. engchi. Generally speaking, educated people tend to be more concerned about their health, their eating habits and the quality of the food they consume. Therefore, we consider that all of them are potential customers for our products. In the second stage of the project, we will expand to other Central American countries. We plan to expand to Costa Rica and El Salvador first because of the already existent relationship with suppliers in those countries.. 4.3.. Consumer Behavior. Buying a salad dressing is seen as a habitual buying behavior because of low perceived brand differences and low involvement. Through our Marketing efforts, we want to make buying a salad dressing a variety seeking behavior by increasing the consumer’s involvement.. 18.

(28) In general, consumers group a new brand in an established product category and then distinguish it from existing brands in that category. However, our product is not only a new brand but also a new category within the salad dressings; therefore, when deciding whether or not to buy Alfresco vinaigrettes, consumers will be going through an extensive problem solving. In order to explain the process by which consumers go before making a purchase we will use the Consumer Decision Model modified for extensive problem solving.. 立. 政治大. y. ‧. ‧ 國. 學. io. sit. Nat. Figure 6. CDM Modified for EPS. n. al. er. Because consumers need to create a different product category in their mind, they need a lot. i n U. v. more information about the benefits that this new category brings for them. Because of this, the. Ch. engchi. first purpose of our marketing strategy is to inform consumers about the advantages of consuming organic products and the disadvantage of the regular salad dressings. Once we have helped create a category in the mind of consumers, we must offer information about our brand and products. The information in the model, is not the one we send the consumers through our advertising campaigns, but their own understanding of the brand. Brand recognition is the extent to which consumers are able to recognize our brand, is the “image” in the mind of consumers. By including our logo in every post in social media, we will try to create a top of mind awareness of the brand. Attitude towards the brand refers to how much the consumers expect the brand to satisfy their needs. In order to promote a positive attitude toward our brand, we should first identify the. 19.

(29) consumers’ needs and then list them as benefits that our product has. By matching product benefits with consumers’ needs we can stimulate a positive attitude. Confidence is the third element in the buyer’s image of the brand and denotes the certainty that the consumer’s judgement is correct. The confidence can be affected by word of mouth and recommendations. Once innovators have tried our products, we are positive that they are going to recommend our products to their family and friends because of the high quality of our products. Intention to buy is whether or not the customer plans to buy our product. This is influenced by. 政治大. the confidence, brand image and attitude towards the brand. If we effectively affect the other three, the consumer’s intention to buy will be higher. And as a result, the probability that they. 立. make a purchase will be higher as well.. ‧ 國. 學. 4.4.. Product. Alfresco offers organic vinaigrettes and dressings prepared with premium quality ingredients. ‧. and fresh vegetables. At the same time, we only use natural products as preservatives. This. sit. y. Nat. might reduce the expiration date of our products, but we strongly believe it is worth it.. io. er. With our diabetic consumers in mind and in order to avoid highly caloric diets, Alfresco vinaigrettes do not have sugar added as part of their ingredients.. n. al. Ch. i n U. v. Alfresco vinaigrettes and dressings only use olive oil as a base because of the health benefits. engchi. that it has for our health. Furthermore, we do not combine any other type of oil in our products because that would reduce the effects that the olive oil has and will add unnecessary fat to our consumer’s diet. The ingredients found in Alfresco vinaigrettes are not only natural but organic. Our customers do not have to worry about chemicals being present in their food. Finally, all our vinaigrettes are gluten and lactose free. We offer four different flavors of vinaigrettes: . Balsamic Vinegar Vinaigrette. The balsamic vinaigrette is made of balsamic vinegar and olive oil.. 20.

(30) . Italian Herb Vinaigrette. The ingredients of the Italian Herbs Vinaigrette are: rice wine vinegar, olive oil, chopped garlic and onion, mustard, fresh minced oregano, thyme, lemon juice, and black pepper.. . Basil Dressing. The Basil Dressing is one of our favorites because of its fresh flavor, among the ingredients we can find: rice wine vinegar, lemon juice, fresh minced basil and parsley, chopped garlic, olive oil, and black pepper.. . Lime Cilantro Dressing. The lime cilantro dressing as its name denotes it, is made of lemon juice, fresh shredded cilantro leaves, olive oil, rice wine vinegar, chopped garlic, thyme, cumin and black pepper.. 政治大 While the competitors all 立 use plastic bottles or pouches as the package for their product,. 4.4.1. Package. ‧ 國. 學. Alfresco vinaigrettes and dressings will be packed in glass bottles with a cork to control the pouring quantity. We chose glass instead of plastic because products packaged in glass containers have a better image and denote a higher quality.. ‧. All our dressings are packed in 8oz. containers because of the short expiration date that they. Nat. sit. y. have due to the use of natural preservatives.. n. al. er. io. Figure 7 is an example of the proposed package for Alfresco dressings.. Ch. engchi. i n U. v. Figure 7. Product Package Example. 21.

(31) 4.4.2. Competitive advantage The main competitive advantage that Alfresco dressings have is the fact that they are organic, gluten, sugar and lactose free. Currently, there isn’t any product with these characteristics in the market. Being the first mover, will allow us to get a higher market share and create customer loyalty before new competitors enter the market. At the same time, its packaging will attract consumers’ attention since it is different from everything else that is currently in the market. Middle and high class customers will see these bottles as something that they can put on their tables on dinner parties.. 治政大price is between 50 and 100 percent Alfresco dressing price will be US$4 per 8oz bottle. The 立 higher than the price of the 8oz dressing bottles currently in the market. However, our product Pricing and Positioning Strategy. 學. ‧ 國. 4.5.. is organic and there are currently no organic dressings to benchmark against.. 4.5.1. Positioning map. ‧. In order to build the perceptual map, we chose the stronger competitors and the ones that we. y. Nat. believe could be a closer substitute for Alfresco dressings. The perceptual map was constructed. er. io. sit. in base of two characteristics: health benefits and variety in flavors.. The reason why we chose variety in flavors as a factor in the perceptual map is because we are. n. al. Ch. i n U. v. looking for the consumers that instead of having a habitual buying behavior, have a variety. engchi. seeking behavior when buying salad dressings. In fact, we are going to build our advertising campaigns in a way that promotes this type of behavior even between the consumers that currently have a habitual buying behavior. On the following perceptual map we can see that the big global brands – Kraft, Wishbone and McCormick – are in the quadrant of ordinary flavors and not healthy. Out of those three, Kraft could be seen as a little healthier than the rest since they offer light versions of their regular flavors. However, the savvy consumers know that light does not mean healthy. Delga C is in the ordinary flavors and healthy quadrant. All Delga C products are fat free, which can be seen in the mind of some consumers as healthy. At the same time, the brand in general is promoting its products as products designed to lose weight. However, as Dr. Ferruzzi. 22.

(32) concluded in his study, the lack of fat in some dressings make it harder for our body to absorb all the nutrients and vitamins that the vegetables have. Ken’s Steak House is the only brand located in the unique flavors quadrant. Instead of offering the same old flavors – Italian, Ranch, Caesar and Thousand Islands –, they entered the market with completely different flavors such as Sundried tomatoes, Greek and Sweet Vidalia Onion. However, Ken’s dressings cannot be seen as healthy since they are all cream based. If we check their webpage they do have healthy options with low calories and olive oil, nonetheless those options are not in the Nicaraguan market. Still, we should see this brand as a potential threat if they decide to import those healthy flavors.. 政治大. Finally, Alfresco is alone in the healthy, natural and unique flavors quadrant. It is also local and. 立. organic. Just the kind of product our high-end educated customers want.. ‧ 國. 學. We believe that because this quadrant is currently empty, there is a gap and a niche market that is not being served in the present. Therefore, we have an opportunity of grabbing that demand. ‧. and some liberty at setting prices since we are the only player in that segment.. n. er. io. sit. y. Nat. al. Ch. engchi. i n U. v. Figure 8. Perceptual Positioning Map. 23.

(33) 4.6.. Distribution Plan. Since organic dressings are something that is still not present in the Nicaraguan market, we want to capture first the innovators; those customers who are always eager to try new things and do it first. Because dressings are not high involvement purchases, we believe that we can easily get to the early adopters through word of mouth. In order to accomplish this, we will start with a selective distribution focusing only in upscale and specialty stores. In Nicaragua there are four main upscale stores: . Porta’s. Plaza Porta’s is located in Villa Fontana, a middle-high class neighborhood in. 治政 class social club: Club Terraza. In the last couple 大 of years, the office sector is developing 立more than 4 office buildings built in the last two years. A second around this area, with Managua. Near this supermarket there are two middle/high class schools, and the upper. ‧ 國. 學. branch of Porta’s is located in Carretera Masaya, which has become the middle class suburbs of Managua.. ‧. n. er. io. sit. y. Nat. al. Ch. engchi. i n U. v. Figure 9. Super Porta’s location – Villa Fontana Branch . Stop ‘n Go. Stop ‘n Go is located in Santo Domingo, one of the biggest high class neighborhoods in Managua. Stop ‘n Go is famous among consumers for having products no one else has. They have a lot of imported products from United States and specialty products from other countries such as mate from Argentina and guarana from Brazil. Recently, they started importing a wide variety of gluten free products and are offering. 24.

(34) organic products as well. This is the “go to” place in Managua if you are looking for something unique.. 立. ‧ 國. 學 Figure 10. Stop ‘n Go Location. ‧. . 政治大. Bavaria. Bavaria is technically a butcher store. However, since they sell imported and. sit. y. Nat. premium quality meat and cheese, their customers are middle and high class households. In order to achieve economies of scope, Bavaria started offering other types of products. er. io. besides their main product. Bavaria Santo Doming is located next to Stop ‘n Go, so that. al. n. v i n C Sur. Carretera Sur is anotherharea where the high class live. In that area, e ningManagua chi U store won’t be our main focus. The branch that we are interested in is Bavaria Carretera. there are many embassies, the German school and a high class Country Club. . La familiar. La Familiar is a convenience store located in Los Robles. Los Robles is a middle class area that has become a commercial area in the last couple of years. This area is considered as the new center of the city and there are many office buildings around. They distribute many imported and special products, so just like Stop ‘n Go, this is the place where the consumers in the area will go if they are looking for a special product.. Once we have gauged demand from the innovators and early adapters, we want to attract the early and late majority. In order to do that, we would change our distribution strategy to an. 25.

(35) intensive distribution by placing our products in the two biggest hypermarket chains in the country: . La Colonia. There are 20 branches of Supermercados La Colonia in Nicaragua. In Managua alone, there are 16, including two wholesale style hypermarkets. From those 16 branches, we would like to distribute our products in 8 because of their location. The branches chosen are: Veracruz, Hiper, Camino de Oriente, La Centroamerica, Metrocentro, Carretera Sur, Nejapa and Plaza España. These branches are located in neighborhoods were our target consumers work and live.. . La Union. There are 8 branches of Supermercados La Union in Nicaragua. From those,. 政治大. we are going to focus on three: Esquipulas, Nejapa and Carretera Masaya.. 立. An important consideration is that both of the chains have branches in other important cities in. ‧ 國. 學. Nicaragua, which will make it easier for us to expand to those cities once we establish a relationship with these distributors.. ‧. 4.7.. Promotion Strategy. y. Online Marketing. The main advertising channel will be the internet. The Online. io. sit. . Nat. 4.7.1. Pull Marketing.. al. v i n Ch U store pamphlets where new products our products (during the introduction e n gperiod) c h iin the n. . er. Marketing strategy will be described in detail in the next section. In Store offer deals pamphlets. Once we get to the hypermarkets, we will advertise. and product offers are displayed. . Word of mouth. Because of the quality, uniqueness and health benefit that our products have, we will rely on consumers’ recommendations and word of mouth. Since salads are practically a must-have element in dinner parties, there are a lot of people who ask about the products used during such events.. . Appealing packaging. As mentioned in the packaging section, our glass bottles are different from what already exists in the market, therefore, we are aiming that it will attract our potential customers’ attention.. . Advertising through distributors’ social media channels. Since Stop n’ Go has very unique products, they advertise the new products they have in stock in their social media. 26.

(36) channels. Regular customers of these distributors follow them on social medial and this could generate brand awareness for us. At the same time, Supermercados La Union publishes recipes on their webpage, making use of the products they sell on the stores. . Public Relations. We will try to get to the morning TV talk shows where new products and brands are presented.. 4.7.2. Push Marketing . In store tasting. We will do in store tasting in hypermarkets during the night and weekends, that is the time when most consumers do their shopping. This strategy will. 政治大 Efficient supply chain 立management. In order to keep the distributors happy and get a create awareness of our brand between consumers.. . ‧ 國. 學. higher number of facing and a better shelf location (the preferred one is eye-level), we must be efficient at managing our supply chain. We have to have inventory ready to restock and avoid being out of stock in any of the branches.. ‧. . Nutritionists’ recommendations. We already have strategic alliances with some. y. Nat. nutritionists that work in the most important private hospital in Nicaragua. One of them,. io. sit. work as the nutritionist in the Diabetics Clinic of that hospital. The doctors can. 4.8.. al. n. product has.. er. recommend and refer their patients to our products because of the health benefit that our. Ch. engchi Online Marketing Strategy. i n U. v. 4.8.1. Content Marketing We will create a company webpage in order to present an image of a well-established company. In the webpage we will have a product brochure where we will not only portray our existing products, but also give detailed information about the nutrition facts of each one of them. At the same time, we will have a blog where we will post articles related to the latest nutrition trends and studies. This will allow us to bring traffic to our web page and generate brand awareness. We want to position ourselves as a company that not only sells healthy products, but that is concerned about health issues and wants to maintain their consumers well informed about the latest news.. 27.

(37) We will also have a section where we are going to post recipes that can be made using our products. These recipes will be used for the email marketing strategy.. 4.8.2. Email Marketing In one part of the webpage, we will give consumers the option to subscribe to our blog and to get via email the latest recipes and news. This will allow us to be present in the mind of consumers at all times. At the same time, whenever we launch a new product we will let our customer base know first, in order to create expectation and anticipation.. 4.8.3. Social Media Marketing. 治政 frequently used social media platforms in Nicaragua. 大立. We will have company pages in Facebook, Instagram and Twitter as those are the most. Twitter. ‧ 國. 學. In Twitter we will post every time we have a new article or recipe on the website and post a. ‧. link to our web page to generate organic traffic. At the same time, we will share news about nutrition that we find in other channels and nutrition magazines in order to create an image of. sit. y. Nat. social responsibility for educating consumers. We want our consumers to see us as a channel to. io. Facebook. er. get the latest news about health and nutrition.. al. n. v i n C our products, saladsUusing our products, infographics about In Facebook we will post pictures ofh engchi. health, etc. At the same time, we will try to engage the community through different activities. For example, we can invite users to post their favorite recipe using Alfresco dressings and the recipe with more likes would get free products, plus their recipe will be featured in the recipes section of our webpage. Instagram Instagram is 100% based on pictures, therefore, we will post pictures of our products and of the salads from the recipes published in our webpage. At the same time, we will post pictures of the winners from the Facebook contests and some nutrition facts to continue educating our followers.. 28.

(38) 4.8.3.1.. Social Media Strategies. At the beginning, before launching the product we will create a social media campaign in order to generate expectation, buzz and anticipation. We want the people to start talking about our products even before we launch them. Endorsement from local celebrities. We will send gift sets with our products to local celebrities who are active in social media, so they can endorse us in their public profiles if they like our products. Maintain a mix between organic and paid reach. At the beginning, because our follower base. 治政 attract followers. Once we get a wider follower base, we大 can rely more on the organic reach of 立 our posts. will not be that large, we will invest in promoting posts in order to generate awareness and. ‧. ‧ 國. 學. n. er. io. sit. y. Nat. al. Ch. engchi. 29. i n U. v.

(39) 5. Strategic Planning 5.1.. External Analysis. The industry where Alfresco will be competing is the salad dressings industry. Currently in Nicaragua there are no direct competitors for organic salad dressings, however the regular salad dressings can be considered as competitors for Alfresco salad dressings. The organic industry in general is in the introductory stage in Nicaragua, and so far it has had a good acceptance among consumers. The market segment for the organic products covers the middle and high level income households in Managua.. 政治大. 5.1.1. Porter’s Five Forces Analysis. 立. ‧. ‧ 國. 學. n. er. io. sit. y. Nat. al. Ch. engchi. i n U. v. Figure 11. Porter’s Five Forces Analysis. 5.1.1.1.. Risk of Entry by Potential Competitors. In the food industry in general, the customer’s switching costs are practically nonexistent. They can go from one brand to another without much concern. In the case of salad dressings that have a low cost and a relatively high purchasing frequency (1+ bottle per month), the cost becomes even lower. Consumers can practically consume a different brand each month, which would be an advantage for new entrants. Additionally, according to Doing Business, a World Bank entity, it takes only 11 working days4 to open a new company in Nicaragua. However, in 4. Doing Business. “Starting a Business in Nicaragua”.. 30.

(40) order to distribute food products, the product must have a permit from the Ministry of Health, which would be an entry barrier for new competitors. Moreover, we plan on building brand loyalty from the beginning in order to maximize our share of customer, and make it harder for potential competitors to enter the market.. 5.1.1.2.. Rivalry among Established Companies. Currently, there are no big differences between the products offered by the existing competitors. There are 3 main competitors offering the same flavors with the same quality. Therefore, 5 cents can make a big difference when consumers are making a purchase decision. We are not afraid of this high level of rivalry because our products have a differentiation factor that we will. 政治大. make sure to highlight through our marketing efforts.. 5.1.1.3.. 立. Bargaining Power of Buyers. ‧ 國. 學. Due to the high number of consumers, they have no bargaining power in this industry. If one particular consumer do not want to purchase our products, there are others that will. As a result,. Bargaining Power of Suppliers. y. Nat. 5.1.1.4.. ‧. the risk is very low.. sit. Since in Nicaragua agriculture is still one of the main sectors in the economy, there are a lot of. er. io. farmers that can provide fresh, organic products. Hence, the power that the farmers might have. al. n. v i n C hthe bargaining power higher bargaining power. In general, e n g c h i U of suppliers is low.. is low. However, there are not many importers of olive oil, so they might have a relatively. 5.1.1.5.. Substitute Products. Salad dressings can have a lot of substitutes such as salt and lemon, vinegar and oil, etc. Consequently, the power of substitute products is very high.. 5.1.2. Industry Life Cycle Analysis Salad dressings are already a mature industry. Some might even consider it as a declining industry. Because of this, the big brands are always trying to innovate through flavors and presentations. In Nicaragua, the organic salad dressing industry is currently nonexistent; therefore, Alfresco dressings will be a disruptive innovation and the organic salad dressings industry will be in an embryonic stage. This will bring all the advantages and risks that being. 31.

(41) the first mover has. However, from the success that the organic industry in general has had in the country, we consider that there would be more advantages than risks.. 立. 政治大. ‧ 國. 學. Figure 12. Salad Dressings and Organic Salad Dressings Life Cycle in Nicaragua. ‧. 5.1.3. Macro Environment. Macroeconomic Forces. During the last five years (2011 – 2015) Nicaragua has had. sit. y. Nat. . an average real economic growth of 5.16%. The trade industry, which is where all the. io. er. retail sales are located, has had a 6.74% average growth during the same period. al. n. v i n C h 1993, Nicaragua the GDP (11.90% in 2015). Since e n g c h i U has had a fixed currency slip rate. In. (Blandón Sequeira, 2009), and it is the second industry with the biggest percentage of. 2004, this rate was set at 5% per year. The average inflation from 2011 to 2015 has been 5.98.. . Demographic Forces. From 2010 to 2015 the average population growth in Nicaragua was 1.22 percent, with a gross birth rate of 23.2 per thousand inhabitants. 42 percent of Nicaraguan population is between 0 and 19 years old which means that Nicaragua is a young country (UNFPA, 2016).. . Social Forces. As mentioned in the opportunity section, Nicaraguans have become more health conscious. In the country, the salad franchises, dance studios, gymnasiums, health centers, fruit shake businesses, etc. are flourishing. This only reinforces that this is a growing segment in the country.. 32.

(42) 5.2.. Internal Analysis (Competencies and Competitive Advantage). The main intangible asset that the company has is the marketing expertise of one of the founders. This expertise will allow us to create a strong brand image, to have a well-managed customer relationship and overall, to create loyal customers. One of the main competitive advantages that Alfresco has is that we are going to be the first movers in the organic salad dressings category, which gives us the freedom to set the industry standards and prices.. 5.3.. SWOT Map. 立. 政治大. ‧. ‧ 國. 學. n. er. io. sit. y. Nat. al. Ch. engchi. i n U. v. Figure 13. Alfresco Organic Dressings SWOT Map The two main weaknesses that Alfresco has are related with being a start-up. We will have to build from zero the relationship with the distributors and our brand image and brand awareness. However, because of our Marketing expertise, this is not a mayor concern for the company. A second important weakness is related to the short shelf life that our products have in comparison to competitors’ products. Notwithstanding, we believe that our customers will understand that the low expiration date is because of the use of natural ingredients as preservative and they will value the health benefits this signifies.. 33.

(43) Additionally, the high quality of our products, our unique flavors, attractive packaging and unique positioning will help us create customer awareness and gauge demand. Once we are able to gauge demand in the high end stores, where it is simpler to enter, it would become easier to convince the hypermarket chains to carry our brand. This would counter the weakness of not having a current relationship with the distribution channels. As mentioned in the market overview, the Nicaraguan market brings a lot of opportunities for us as a company. Since the Nicaraguan economy is in the growth stage, there are a lot of opportunities for young entrepreneurs like us. Labor costs are low, establishing a new company is relatively fast and easy, cost of materials is also low and many industries are either. 政治大. nonexistent or in an embryonic or growing stage.. 立. Nonetheless, because of all of these opportunities, there are a lot of new entrepreneurs in the. ‧ 國. 學. country that could be possible competitors. At the same time, if we start to succeed in this category, the existent competitors could decide to import a wider variety of flavors and. ‧. introduce their already existent healthy product lines in order to recover market share. In order to counter these threats, we will make use of our marketing expertise in order to. y. Nat. sit. position ourselves in the market and in the mind of the consumers before new players can enter. er. io. this new market segment.. al. n. v i n C h strategy to eliminate fat free, with being healthy. Our main e n g c h i U this misconception, is to create. A last threat is the lack of knowledge of some potential customers who confuse being light or. advertising campaigns where we educate our audience and explain the difference between the. concepts. Moreover, we will make use of public relations to promote the brand in the media with the help of our partner nutritionists in the morning health segment.. 5.4.. Business Level Strategy. Alfresco vinaigrettes and dressings will use a differentiation focus strategy. All the other competitors are currently using a cost leadership strategy, therefore, their products are perceived to have little or no difference between each other. This means that a small difference in prices can lead to a buy or no buy decision. Our company, however, will create value through:. 34.