Andrea Brambilla

Filippo Cheli

Gianmaria Grandinetti

807927

806811

810661

Summary

Market analysis

Corporate vision

Cadrega’s goals

Conclusions

Analysis by period & trend’s indeces

2

Market analysis

Two different markets

In order to sell products in

business to business market two

constraints must be respected:

1. Minimum level of quality;

2. Maximum price.

The market’s segment is

characterized by a strong

bullwhip’s effect.

4

0

100

200

300

400

500

600 Fabrics

Fittings

Furniture

Wholesaler’ Demand

Two different markets

In the market business to

consumer the clients’ decisions

are driven by:

1. Price;

2. Quality;

3. Brand.

The demand is affected by a

seasonally trend.

5

0

0.2

0.4

0.6

0.8

1

1.2

1.4

1.6

1.8

2

Fabrics

Fittings

Furniture

Economic Trend

Three product lines

6

Here below the average of price and quality, for each product lines, are

reported according to the historical data of the previous two years.

Fabrics:

- Avg price: 286 €

- Avg quality: 63,6%

Fittings:

- Avg price: 87,8 €

- Avg quality: 63,6 %

Furniture:

- Avg price: 803,3 €

- Avg quality: 63,9%

Raw materials (Kraljic)

Leverage products

Routine products

Strategic products

Bottleneck products

Low

Low High

Fin

an

cia

l im

pa

ct

Supply risk 7

High

Imported raw materials

Outsourcing

Local raw materials

8

Corporate strategy

Products: high quality guaranteed by the exclusive use of local raw

material

Price:Established with the mark-up model (around 30%) and belonging to the high-end market

Place:The management aim is to increase the number of

central shops reducing the number of suburban ones in order to be coherent with the new product positioning.

Promotion:Investments in «advertising» and «promotion» will be the most constant and consistent as possible.

9

4P model

10

Cadrega’s goals

11

Cadrega’s goals

The goals of the new management are:

To win the high-end market;

To reduce stocks ( both of finished goods and raw material);

To Improve production performance;

To achieve a higher quality in products.

12

Periods’ analysis

13

January-March 2017

EBIT Share value

Succ

ess

Failu

re

Stra

tegy

& m

arke

ts• High quality;• Saturation of

production Capacity.

• Market share below the average;

• Sales over the expectation in the B2B;

• The best ratio quality/price.

• Wrong forecasteddemand.

Budgeted revenues Actual revenues Delta revenues

46.267.765 € 45.015.460 € -1.252.305 €

Succ

ess

Failu

re

Stra

tegy

& m

arke

ts

14

April-June 2017

EBIT Share value

• Prices more competitive butalways a high-end price.

• Achievedmaximum sales in B2B market.

• Decline of market share;

• Increasing of pricingimportance.

Budgeted revenues Actual revenues Delta revenues

41.239.456 € 39.843.200 € -1.396.256 €

Succ

ess

Failu

re

Stra

tegy

& m

arke

ts

15

July-Septembre 2017

EBIT Share value

• Get a betterbudget revenues-investments ratio;

• Sale of all rawmaterial stock.

• Large gap betweenbudgeted and actual revenues;

• Considerablewarehouse cost.

• 28 leasing machinesto improveproduction capacity;

• Wrong pricingaccording to the average.

Budgeted revenues Actual revenues Delta revenues

52.210.725 € 29.866.400 € -22.344.325 €

16

October-December 2017

EBIT Share value

Succ

ess

Failu

re

Stra

tegy

& m

arke

ts

• Reduction of finished goodsstocks;

• slowing the loss of value.

• Lower pricing for fittings to wincompetitors’ client and reduce stock of FG.

• Only 40% of machinarysaturation;

• 30 ownedmachines sold.

Budgeted revenues Actual revenues Delta revenues

25.795.586 € 33.551.880 € 7.756.294€

17

January-March 2018

EBIT Share value

Succ

ess

Failu

re

Stra

tegy

& m

arke

ts

• Reduction of finished goodsstocks;

• Get a higher share volume for fittings;

• Operative profit returns positive.

• Use of outsourcing for Furniture;

• Get the secondchoice sales for fittings.

• Dismiss 40 sales persons;

• Reduction in qualitylevel.

Budgeted revenues Actual revenues Delta revenues

37.554.987 € 41.027.220 € 3.472.233€

Conclusions

19

S.W.O.T. analysis

• Process quality;• Machines’s times;• Location of shops.

Strenghts Weaknesses

Opportunities Threats

• Wholesalers market;• Get larger market

share.

• Production capacity;• Debt;• Pricing strategy.

• Volatile prices of competitors;

• Brand’s leader;• Investments-revenue

ratio.

20

Successes and failures

• Win, in part, the high end market;• Production performances increased;• Better management of point of sale;• Total reduction of raw material stock.

• To increase the net profit;• Reduction of finished good stocks;• Estimation of adjusted finish goods stock;• Financial management: debts with banks;• Lack of flexibility.

Thanks for your

time

21