Azaela Seafood Gumbo Shoppe
Case 9
Components | % of Grade |
Clear explanation of key strategic issues | 20% |
Valid arguments; analysis of company’s performance with relevant supportive detail | 20% |
Appropriate analysis, evaluation, synthesis for the specific industry identified | 20% |
Conclusions and recommendations are congruent with strategic analysis | 20% |
Proper organization, professional writing, and logical flow of analysis. APA formatting | 20% |
TOTAL | 100% |
Livia Tanacova
liv.tanacova@gmail.com
BSM 495: Business Strategy
Instructor: Johan Winbladh
Basic Case Study
17.04.2018
BACKGROUND & RELEVANT DETAILS
Azaela Gumbo Shoppe was established in Mobile, Alabama, in 1972. The company focuses on seafood packaging. Gumbo, crawfish etouffee and shrimp creole are considered as its key products. The location was perfect for this kind of business, as the Alabama was on the northern coast of the Gulf of Mexico. Company was successful from the beginning. However, it changed its owners a few times, till August 1991, when it was bought by Sibley, Addison, and Rathle. In 2001, Sibley sold his interest and left the company in hands of Addison and Rathle. (Thompson, J.A., & Strickland, A. J. , 2003).
The key success factors for the seafood industry, is to be able to deliver on time, the quality, and brand reputation. Addison and Rathle believe that the company’s just in time process helped to keep the costs low and improved cash flow. One of the disadvantages is, that they have very little inventory, so there is almost impossible to sell to jobbers. (Thompson, J.A., & Strickland, A. J. , 2003). Demand forecasting is crucial. If Addison and Rathle underestimate the amount of inventory they customers want, they could loose them. Demand forecasting is also important for minimizing the inventory and , as already stated above, it optimizes cash flow. ( Kokemuller, 2017)
In terms of sales, the company uses direct approach via catering. However, catering is not that profitable for the company as the wholesaling, which creates the highest revenue. Between 1992 and 1999, sales had grown at a compounded rate of 33 percent. Later on, Azaela’s sales fell down by 15%. (Thompson, J.A., & Strickland, A. J. , 2003).
It is known that companies in this industry are used to work with food broker. Food brokers manage sales to big supermarkets or grocery stores.
One of the biggest benefits is, that they are able to ensure the preferred placement of the product on shelves in the supermarket or groceries. Azaeala’s distribution network consists of 1000 supermarkets. Rathle and Addison are continuously trying to keep a favourable product placement, which is mostly very challenging task. (Thompson, J.A., & Strickland, A. J. , 2003). Their products is many times moved without their knowledge, which leads to loosing their competitive advantage. It can be said that, even with the great quality and irreplaceable taste of their products, each food producer is their competitor. (Thompson, J.A., & Strickland, A. J. , 2003). In the past, Rathle and Addison were trying to get a good food broker, but they realized that they are not big enough. (Thompson, J.A., & Strickland, A. J. , 2003).
Talking about growth opportunities for the Azaela Seafood Gumbo Shoppe, gaining some more food-service accounts could be very beneficiary for the company. Rathle tried to convinced some corporate buyers to make a deal with them, however big corporations have problems with Azaela’s facilities. (Thompson, J.A., & Strickland, A. J. , 2003).
RECOMMENDATION & REASONS FOR RECOMMENDATION
- REBRANDING + HIRING MARKETING SPECIALIST + INCREASE OF PROMOTION AND SALES BUDGET
Rebranding (which would include the new product offer and new packaging ) would allow the company to connect with a new audience – reach new potential customers. One of the main goals of rebranding the company is, that it will keep the brand current. (Menardi, 2015)