The main issue of the Natureview Farm is that whether the company should expand
into the supermarket change in order to meet its revenue goal. Since VC firm needed
to cash out of its investment in Natureview, it would be critical for Natureview to
grow its revenue. And In 1999, supermarkets sold 97% of all yogurt consumed, and
natural food stores sold the balance. Therefore, Natureview began to consider about
selling their products to supermarkets. Then, they come up with three options,
according to the current situation of this company, I believe the option 1—to expand
six SKUs of the 8-oz. product line into one or two selected supermarket channel
regions is the best.
The followings are the reasons why the company should choose the first option
rather than other two options. First, this option can realize the $20 million revenue
growth. After one year, the annual sales volume would be $35 million, and the
average retail price of 8-oz. cup yogurt in supermarket is $0.74, in addition to all
other costs, the final revenue should be $25,260,000, which is greater than $20
million. Second, according to the Exhibit 2, 8-oz. cups has the largest market share
among supermarket channel, which takes up nearly three times of the total of
