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M1S1 – DUCK Persimmon Fruit

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Author

ITC – Begoña Arenas

Mini Project ID

ITCMPFRUIT

Description

The ROYAL DUCK company produces and distributes three types of fruits: oranges and clementines. They are produced in Malaga (Andalusia, Spain) in AXARQUIA an area which holds special conditions to grow these fruits.

Product engineers are also experimenting growing a fourth product: persimmon. The idea is to bring over the Spanish and European market a kind of khaki, easier to store and eat than khaki itself: persimmon (“Persimmon” or “KAKI Persimmon” is the flavoursome Spanish variety of the traditional, classic Khaki, or Persimmon, with a double ‘m’, which also includes the Sharon fruit).

Sector

General

Data

Persimmon has a specific production distinction orange and clementines do not have, they need to be stored in chambers with a temperature of 20º, an atmosphere controlled with 5,000 ppm of ethanol and a relative humidity of 90% for approximately 16 hours.

It was then examined how many trees would be worth planting for the company. The competing company, the TROPICAL SPARROW, has already launched their production of persimmon, based in Valencia at a price of 2€/Kg. According to ROYAL DUCK executives, they are having success, but the ROYAL DUCK believe they can compete.

Model

Calculation

Solution

Management has no idea how much TROPICAL SPARROW will do with their product, but if they want to squeeze them out, they can only market the new ROYAL DUCK persimmon advertising price and marketing strategy. This will be unprofitable in the short term, but the product may be dominant in the market, so the initial loss may pay off with great benefit.

At the kickoff meeting in the company they normally have when an innovation is to be introduced, the management asked a professional committee appointed by them to answer the following questions:

  1. What improvements need to be made to cope with the new production and the current annual production of oranges and clementines?
  2. What permits are required to obtain from the authorities to start this new production? Does persimmon comply with all health, consumer protection, and regulations?
  3. Are new packages needed for persimmon?
  4. What promotional strategy should be used to launch the new product on the market and at what cost?
  5. What should the new advertisement look like?
  6. What should the new product look like?

Presentation

Review M1S1 – DUCK Persimmon Fruit.