Montreaux Chocolate- Forecast and Market Research and Decision

Week 4 Assignment 1 Question 1:  Montreaux Chocolate- Forecast and Market Research and Decision

Based on the 9 attached scenarios of Montreaux Chocolates new product development of a healthy fruit covered chocolate product to be released in the United States I do not expect them to reach the expected “hurdle rate” of $30 million.  Although they come close with the highest awareness and availability margins projected by the product development team with an optimistic outlook I do not see that being likely.  The reason for the uncertainty is based off the fact that the margins for this product are extremely low and the repeat rate of buyers for all ranges of product quality are less than 40%.  The most likely scenario would be using an average product of Cocoa, low level of awareness due to the limited marketing and public knowledge of the product and high level of distribution, which could be leveraged from the partnership with Apollo foods.  As shown in the forecast below this leaves the sales target at roughly half of the desired “hurdle rate.”  The proof is in the numbers, the Montreaux Chocolates team needs to revise its strategy and expectation for this new product release and work to increase their margins by moving into the premium chocolate markets where they could charge a higher price to get well above the $30 million hurdle rate.

Week 3 Assignment 1 Question 2:  Le Petit Chef Case-Resource Analysis and Categorizing Existing Projects

After categorizing the ongoing and proposed projects for Le Petit Chef based on the; breakthrough/platform/derivative criteria it was clear why certain engineers were felling overburdened while some were not being utilized at all.  All but one of the ongoing projects would fit into the classification of platform or derivative while on the proposed projects all but two would be classified as breakthrough projects, with two platform projects (that were on the verge of being derivatives).  This unevenness of projects proved to be the crux of Le Petit Chef’s R&D resource issues.

It was clear to see why the competition was gaining such quick ground in the late 1990’s by analyzing the ongoing projects for Le Petit Chef.  (Appendix 1)   The Asian markets were coming up with innovations to their cost and product strategy at a much quicker rate than Le Petit Chef.  The ongoing projects were either projects that were making existing products more cost effective or adding small enhancements (derivative) or were making slight process modifications and design improvements to decrease cost on existing projects (platforms).  Two of the ongoing projects were dedicated to improving the Liberte line, three of the projects were improvements to the Egalite line, and one project was an improvement that benefitted both lines and the last project was an enhancement to the aesthetics of all their lines.  With no ongoing breakthrough projects the current situation at Le Petit Chef was disconnected to their charter of “maintaining the technical and innovative edge of their products.”