Strategy and Implementation Summary
Our strategy is based on serving niche markets well. The world is full of consumers who can’t get what they perceive to be high quality or authentic. We are capitalizing on the family heritage in our product line.
We are building a marketing infrastructure that will provide what appears to be a seamless approach to our products, covering multiple avenues of utilizing grocery stores and major distributors. Each location will accent the other, providing for continuous exposure of Salvador’s name.
5.1 Marketing Strategy
We are focusing on the consumer first through grocery exposure, and then impacting them through restaurants and other food places.
5.1.1 Promotion Strategy
The long-range goal is to gain enough visibility to leverage the product into other distribution sites within our region, then to move on to other geographical regions as inquiries and distribution requests come in.
Although our current contacts in the grocery chains are for local consumption, they all move out of this region in their normal distribution. It is our goal to move with them.
5.1.2 Distribution Strategy
To this means we have been continually reworking our packaging for better corporate identity, providing a more attractive package, a very important ingredient in the food industry. An example is the recent addition of bar-coding and nutritional information to our label.
5.1.3 Pricing Strategy
We are able to price our products competitively. Even though we are subject to some impulse buying, we can provide a product to be resold at a generous mark-up for our dealers, while still providing a satisfactory experience for the consumer. At a retail range of $2.79 to $3.05 per jar of salsa, we cover the mid-to-upper price range of the salsa market, while providing a 33% margin for the dealers.
5.2 Sales Strategy
The keys to our continuing success are in the areas we are adding to our current distribution channels. This will remain our main focus for the next five years. Sales calls on the following enterprises have resulted in Salvador’s Salsa being stocked and sold by them.
Bassets IGA (Oak Harbor)
Brinkman’s Country Corner (Findlay)
Char’s Best Market (Toledo)
Connie Mac’s (Toledo)
D & D’s Carryout (Pemberville)
E & L Meats (Detroit)
El Aguila Bakery (Fremont)
Elmore Super Value (Elmore)
Falls Crestview Market (Toledo)
Gift Baskets (Perrysburg)
K.O.A. Campground (Stoney Ridge)
La Bottelia (Detroit)
Luna Bakery & Grocery (Detroit)
Mad Anthony’s (Waterville)
Markada (Ann Arbor)
Moser’s Farm Market (Perrysburg)
Ohlman’s Farm Market (Toledo)
Ottawa Market (Toledo)
Partners in Wine II (Ann Arbor)
Pauken Wine & Liquor (Maumee)
South Point Carryout (Toledo)
Stephen’s Restaurant (Perrysburg)
Vernor Foods (Detroit)
5.2.1 Sales Programs
Dealer sales: Thorough and persistent effort to generate sales through major names including:
- Meijer, Inc.
- Foodtown, Inc.
- Moctezuma Foods, Inc.
- IGA (various)
To this means, we are currently interviewing distributors to assist us with the marketing and distribution of our salsa. Again, the hiring of a distributor, and a modest performance increase on their efforts for Salvador’s would make our sales projections conservative. Key to the sale and distribution of our products through this channel is the constant care and feeding of the buyers for each of the organizations. Sales calls on a regular basis, along with samples of new product, will keep the doors open to us.
5.2.2 Sales Forecast
We currently forecast our sales to grow at an astounding rate for the next 12 months because of written commitments we have received from distributors intending to take on our product line in larger volumes in the future.
This growth will continue, but at a lower rate for the next year, and the following year. We anticipate the growth rate to flatten out within five years, but to remain steady. Should the market on Hispanic food items continue at its current pace, we will keep pace with it. Our forecast does assume a downturn in the product within a three-year period, and the lower figures are a reflection of that forecast. We would be happy if it didn’t falter.
|Direct Cost of Sales||1996||1997||1998|
|Subtotal Direct Cost of Sales||$64,916||$86,928||$124,821|
5.3 Strategic Alliances
We do have some opportunity for building strategic alliances with several local restaurants some of which are listed below. Approached properly, they will not only serve our products in their restaurants, but also sell for carry out.
- La Perla
- Connie Mac’s
The following table lists important program milestones, with dates and budgets for each. The milestone schedule indicates our emphasis on planning and for having a sure method of implementation when the time comes for each action.
|Milestone||Start Date||End Date||Budget||Manager||Department|
|New Product Development||1/1/1997||12/1/1997||$350||Pat/Ric||Marketing|
|Third Employee – Administration||1/15/1998||3/1/1998||$18,500||Patricia||Admin|
|Fourth Employee – Warehouse/Delivery||3/1/1998||6/1/1998||$24,500||Ricardo||Warehouse|