Your company bakes and sells a unique line of low-sugar, low-fat frozen pies. Thanks to a proprietary blend of
ripe fruit and vibrant spices developed by Steve, your pastry chef, your products are acclaimed for their taste and quality. In fact, they have won coveted international culinary awards. They are routinely praised by food critics – and ordinary pie-eaters – who are committed to healthy eating.
Until now, you and Steve have been focused on perfecting your core competency. Your slogan – “The world’s best taste — with good health baked in!”– appears on only a single storefront facility, but even there, you’ve always noticed a mixed composition of buyers: pies sell briskly to both individual pie-lovers and owners of local restaurants. Now that you’re ready to expand, you’ve identified two potential opportunities.
One option is to build a national, direct-mail consumer market. Because your target audience is highly involved with healthy foods – and there is minimal competition – you could charge a premium price and build an enduring reputation. However, shipping and advertising costs would be substantial, cutting into your profits.
The other option is to focus on restaurant chains that specialize in healthy food. While you couldn’t charge businesses as much as consumers, your profit margin would be higher in the business market because advertising is less important and you could sell a big volume of pies to each account. The drawback: neither you nor Steve has experience dealing with the collective decision-making entity known as a “buying center.”
please answer; is it:
B) Restaurant Chains