Mavesa's Nelly Brand: Improving Distribution to Gain Market Control

Mavesa S.A. is a leading Venezuelan food confederacy that is show the dilemma of repositioning its Nelly mayonnaise brandmark using a lower price in response to the economic conditions. This yearning strategy attempts to gain grocery store share, but it re boons an inauspicious involve for profits in the long run. In my opinion, the company sooner of reducing the product?s price, it should focus more than on giving attractive fillips to wholesalers. In addition, the company should getting even into regard a new c antiophthalmic factoraign to reinforce the brand mental picture of this product in tell to go for customers? loyalty. Finally, the company should foreclose investing in R&D to break packaging and tasting. During the 1990s, Venezuela was experiencing a deep nook and the effect was felt up in the food pains in a step-down of consumption, but most great in the way that consumers were ever-changing to lower priced brands. Mr. Paez, manager for Mavesa mayonnaise, argued that a price cut would growing sales for around 40 percent with a taxation profit remaining the same. However, the count was unrealistic since the mayonnaise market was contracting and he was expecting to shit more than 60% event of tons (see exhibit 1). Therefore, from my perspective, I believe that improving the scattering in minute and median(a) stores with wholesalers is the best substitute(a) to append sales without dropping the price.

So far, small and medium stores were serviced mostly by wholesalers (75 percent); however, Mavesa?s products were not present in most of these stores. Thus, t he actual problem in dispersal sess be sol! ved with a better incentive to wholesalers which nates improve Mavesa?s sales without investing in more direct sales force for those channels. Personally, I would increase the advance discount given to wholesalers (see exhibit 2) from 25% to 30% to travel them to push... If you want to get a full essay, order it on our website: OrderCustomPaper.com

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