Just Us Cafes – Marketing Assignment Sample Essay

On March 1996. Jeff and Debra Moore incorporated Canada’s foremost just trade java roaster. Just US! It was a worker-owned Co-op. which revolved around the thought of Peoples and the planet before net incomes.

The Mission statement of Just US was based on strong ethical. environmental and societal issues. Hence. the merchandises of Just Us were non merely organic. but besides Fair-Trade. .

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What started as a little java store selling organic fair-trade java in 1996. blossomed into a known cooperative with 69employees and a direction squad of 9 by 2009. The determination doing procedure evolved from cardinal to functional. to back up its market enlargement.

Apart from puting in the 3rd universe states. their providers. they besides invested in making more chances for the local society they incorporated in. In 2005 JUDES ( Just Us Development and Education Society ) was launched to increase consciousness of societal and environmental issues related to international development. the benefits of just trade. and the power of each consumer to do a difference. Just Us museum and societal undertakings like “the Flower Chart” helped in switching consumer focal point towards the trade name.

The Co-op was honored with several esteemed awards. including President’s Entrepreneurial award from Acadia University. With a turning market of just trade merchandises in Canada. Just Us seemed to be on the right path at first. until the planetary recession hit. What seems like a success narrative at first might non be able to last in the long tally if appropriate stairss are non taken.

Introduction

Coffee is the world’s 2nd most valuable traded trade good. behind merely crude oil. There are about 25 million husbandmans and java workers in over 50 states involved in bring forthing java around the universe.

Coffee manufacturers. like most agricultural workers around the universe. are kept in a rhythm of poorness and debt by the current planetary economic system designed to work inexpensive labour and maintain consumer monetary values ( Global Exchange. 2012 [ on-line ] ) .

“About 85 % of Fair Trade Certified java is shade adult and either inactive or certified organic. Over half of the certified organic java is produced by Fair Trade co-ops. but unless the java is Fair Trade Certified. there is no warrant that the husbandman received the benefit. Certified organic java in the Fair Trade market receives a $ . 15 premium per pound” ( Global Exchange. 2012 [ on-line ] )

This study looks at Just Us. from a selling point of position. It tries to measure its internal and external concern environment. including its rivals. The analysis so gives manner to certain recommendations for the selling scheme that can be adopted by the company in short and long term.

1. 0 Environment Scaning
1. 1 Importance of Environment Scanning:

Part of a market audit. environment scanning is the most of import measure towards a sound and effectual Market Plan for any company. Basically. there are three chief stairss of Environment scanning harmonizing to Lancaster and Massingham ( 1996 ) :

1. Designation of cardinal environmental forces that are relevant to development of selling programs. now and in future
2. Forecasting future tendencies
3. Measuring different impacts the tendencies and alterations might hold in the organisation

Similarly. John Westwood ( 2002 ) has placed accents on environment scanning as a major procedure for make up one’s minding selling objects and future schemes. It clearly presents the place of the company and of the merchandises in the market place.

The Environment Scanning is merely every bit of import for Just Us. particularly at a critical clip as this. when they are at hamlets for determining their
selling scheme harmonizing to the kineticss of the market they operate in. The analysis that follows looks at a few of import points for Just Us:

1. Review of economic and concern clime
2. Sing where the company stands in its cardinal gross revenues countries and in strategic markets 3. The strengths and failings of the company as a whole – its organisation. public presentation and the cardinal merchandises 4. Comparison of the company with its rivals

5. Identifying Opportunities and Menaces

The consequences of the environmental analysis. internal and external. through different tools* are included under the undermentioned headers:

1. Economic and concern Climate
2. Gross saless and Key Merchandises
3. Value Analysis

The external analysis of Just Us is done utilizing SWOT. PEST. Geographical Analysis and Porter’s Five Forces ( Appendix A ) . The internal analysis of Just Us includes theoretical accounts such as SWOT. Value Chain and BCG Matrix ( Appendix B ) .

* ( For detailed analysis and application of environment analyzing tools please mention to Appendix )

1. 2 Economic and Business Climate

This is an external analysis. looking at the bigger image environing the concern. Lancaster and Massingham ( 1996 ) stated the importance of an external analysis to foretell the alterations in tendencies around the concern. The economic and concern clime is invariably altering. and particularly in the current times. the more informed and adoptable the house is around the alterations. the more it is likely to win.

IF Just Us can prehend the chances with the strengths they have. they can besides extenuate the menaces and diminish their failings in the long tally. The large image looks at the chance that they have for franchising and joint ventures that they have non tried until now. Although. it may non be the perfect scheme in short term. but the chance to spread out through ventures and franchises exists for the concern.

The political Climate is non favourable to the concern in more so one manner. Their rivals are largely social-conscious concerns. who besides claim to be just trade. but they are non registered with any specific just trade association such as FLO and Transfair. Although. being a registered and certified organic just trade java roaster has a premium border to it. it besides means that they have increased costs compared to their competition and the authorities is non supportive of any just trade ordinances. as yet.

1. 2. 1 Canada’s Economy:

Addition in costs means the concern is traveling to go through it on to the consumers. which in bend have consuming disposable income due to the economic downswing. As can be seen from the tabular array below. 2009 was likely the most affected clip. when Canada’s GDP was at a record depression during the six old ages shown below.

Unemployment has increased in Canada as a whole. particularly during 2009 when the recession hit the market strongest. The saloon chart below from Trading Economicss ( 2012 ) paints a prefect image as to why concerns need to outguess their premium pricing policies in topographic point.

Many concerns have closed or are shuting down. non because their trade name is weak. but because their loyal client base is stealing off due to the strain on their disposable income. Fiscal Post ( 2009 ) . argued that the biggest consequence of the recession is seeable in crisp decrease of trade good monetary values and failing in exports.

The Just Us instance survey besides references of the fluctuating trade good monetary values they had to endure from their providers. This in bend is traveling to impact their programs. budgets and do cost planning hard. The high costs are traveling to demo on their pricing which would be damaging to alter at the current clip.

1. 2. 2 Canada’s Fair Trade Market:

Harmonizing to the Just Us instance survey. the tendency of ethical consumers exchanging to fair trade merchandises is increasing every twelvemonth. Fair-trade Labeling Organizations International ( FLO ) and Transfair are the instrumental organic structures advancing fair-trade in Canada. necessitating a fixed monetary value to be guaranteed to the manufacturers of the 3rd universe states.

Harmonizing to Fair Trade Canada ( Appendix 2 ) . the Numberss of companies registered with them have grown from merely 5 in 1997 to 264 in 2008. What is interesting to see is the tendency after 2008. which has really led to a lessening in the entire sum of companies registered to 243 in 2009 and merely 231 in 2010. This shows that the construct of just trade was good adopted by new comers. since there are few barriers to entry. but shortly. due to the force per unit area of economic depression and the market impregnation many closed down or switched to some other strategy- perchance everything local.

1. 2. 3 The US Economy:
Although the major market of Just Us is in Canada. but they have retail distribution system working in US and are seeking to acquire into the the market farther. Although. the economic state of affairs of Canada is non ideal for concerns presently. but it seems to be relatively making better so the US market. Harmonizing to the Dallas FED ( 2012 ) . the unemployment rate went aggressively up from 2007 onwards. from 4 % to 10 % by 2009. The retail gross revenues. accordingly dropped. particularly between the clip period of 2007-2009.

Consumer assurance in the market seems to be shriveling with the clip period. Although. the economic system seems to be taking some positive stairss after the recession. it is still in a bad form. As can be interpreted from the Dallas FED ( 2012 ) charts. the existent value of dollar is traveling down. disposable income decreasing. hence. the buying power of the consumers is traveling
down with clip.

1. 2. 4 The U. S. Fair-trade Market:

Although. the tendency towards ethical ingestion of nutrient is increasing worldwide. U. S. is taking the tendency by $ 1. 2 billion gross revenues in 2009 entirely. ( The Independent. 2011 ) Mainstream retail merchants saw a 26 % addition in their fair-trade certified merchandises sale in 2011. The lag of the economic system has effected the overall gross revenues in the economic system. but the when the consumers at choose a just trade at a nominal difference in monetary value. they seem to be inclined to do an ethical pick.

“Coffee is the 2nd most of import trade good in US. merely after Petroleum. There are about 1200 roasters in the US today. Large roasters normally have one blend of formulas and sell to big retail merchants – the Big Three ( Kraft. which owns Maxwell House and Sanka. owned by Philip Morris ; Procter & A ; Gamble. which owns Folgers and Millstone ; and Nestle ) maintain over 60 % of entire green bean volume. ” ( Global Exchange. 2012 [ on-line ] )

Even when the economic system of US is in bad form. the tendency of ethical consumer is turning. and if the concerns can offer an ethical merchandise at competitory monetary value. they can tap into the market.

1. 2. 5 Business Environment of Just Us:

For a deeper analysis of concern environment. Porter’s Five Forces Model ( Porter. 1979 ) is most widely used. ( refer to Appendix 1 ) The consequences of the analysis show that Just Us is runing in an environment where there are barely any barriers to entry. When the fairtrade market started to demo the mark of gross. more companies jumped in. and without acquiring registered. except for the large trade names. they developed their ethical nutrient lines. which greatly increased the competition.

“Buyers threaten an industry by coercing down monetary values. bargaining for higher quality or more services. and playing rivals against each other” ( Dess et al 2004:53 ) Due to a autumn in disposable income. purchasers have high power. because if the cafe is bear downing a high monetary value for its merchandises and they are non willing to pay the premium monetary value. clients will be lost.

The power of providers is low since there are many developing states that are unfastened for just trade undertaking offerings. Previously. java providers were exploited. just trade has ensured them better opportunities of endurance in the economic crisis predominating all over the universe. Although. just trade contracts give them some power. but due to easy switching from one provider to another undeveloped part in the universe. the power still seems to lie with purchasers of harvests. wish Just Us.

There are many rivals in the fairtrade industry ; hence the competitory competition is high. Business needs to concentrate on its competitory advantage of Key Selling Points to guarantee its endurance in the long tally.

1. 3 Gross saless and Key Merchandises

1. 3. 1 Fair Trade Gross saless in Canada:

Appendix 3 shows Gross saless of Fairtrade Certified Products in Canada from 1998 to 2011. It is apparent that the just trade basically started with java and subsequently swept to other trade goods ; sugar. tea fruits. chocolate. spices. grains. nuts and oil.

In start the growing of the java was high. which subsequently declined and now its as low an 5 % and 4 % in the last two old ages. This could be a mark of market impregnation and diminution.

Alternatively. the market for sugar is interesting to observe. since its first trade in 2001. it experienced a high one-year growing rate of 1871 % in 2002 to traveling down to a-3 % in 2008. It seems that the market has non recovered for sugar and there are no positive marks for just trade sugar in market.

The volume of just trade merchandises seem to increase every twelvemonth but the one-year growing rate of about all merchandises seem to hold experienced a similar narrative of initial high growing. a small diminution. steady rate for a twosome of old ages and so diminution. After the diminution in 2009. chocolate and java gross revenues seem to be retrieving a small.

The market seems to be really volatile-high ups and downs. unluckily. This could be due to the legal and political factors. Economic depression has besides affected the growing of the industry. Since. these are harvests. they are foremost affected by the natural catastrophes. such as inundations. draft. rain. etc. . particularly prevailing in developing states due to their uneffective substructure.

1. 3. 2 Gross saless of Just Us:

Harmonizing to the Exhibits of Just Us instance survey. the chief beginning of their gross are “Roasted Sales” ( Exhibit 3 ) . mentioning to the gross revenues of their roasted java through different distribution channels. Cafe’s are the 2nd gross doing activity taken over by the concern. Although. grosss from all four activities have increased.

Exhibit 6 of the instance survey shows the gross breakdown harmonizing to their cafe’s geographical locations and months. This gross analysis can enable us to aim the market more expeditiously since it can foreground the best and the worst gross revenues clip of the twelvemonth. It is evident that Q1 is the weak nexus. may be due to weather alterations. Possibly merchandise invention can be of usage here and do the most of this weak one-fourth.

Q3 seems to be the strongest of the four quarters and could be due to the rise of touristry in those months. since Just Us coffeehouse are besides a tourer attractive force due to their alone brand.

Geographically. Grandpre seems to be gaining the most gross. followed closely by Spring Garden. with Barrington being the last. This could be due to the population denseness and besides the popularity factor in older locations.

1. 3. 3 Geographic Analysis

Merely Us is runing in Grand Pre. Wolfville. Barrington. Spring Green and Clarence. Since. Clarence cafe was late opened. its information is non available for analysis. The Map of Canada below can help in understanding the location concentration of Just Us in Canada. ( BBC Canada. 2012 )

Their locations are in the dumbly populated countries of the state. but this could take them to lose on chances offered elsewhere in the state. In wolfville. both stores are close by and in Halifax. merely 10 mins off from each other. Their locations are clumped together which once more means concentrating on specific countries and clients and might take to losing out on other chances. This should be in consideration when they plan their enlargement scheme in long term.

1. 4 Value Analysis

To analyse the Internal environment of Just Us. a value concatenation seems to be suited since it’s a value making concern ad they are bear downing premium monetary value for the merchandise for the valley that they add on to the merchandise. i. e. proviso of organic and just trade merchandise of high quality.

This generic theoretical account was created by Porter ( 1980 ) to analyse the add-on of value for the client through different activities. primary and secondary. ( Appendix 1 )

The Primary activities are value Godheads for clients. which are ; inward logistics. operations. outbound logistics. selling and gross revenues. and service.

For Just Us. the primary activities would be coffee bean import. fabrication processes. packaging. and services in java store and client service for merchandises sold.

These primary activities mentioned. are supported by the secondary activities such as. JU’s Infrastructure. e. g. Coffee store director. section directors. etc. The relationship between the two sorts of activities defines the profitableness for the concern.

While value concatenation can assist in placing nucleus competences of a concern. its reconfiguration can besides take to competitory advantage. By reexamining the costs of each activity and the value it is adding to the merchandise. their assets. investings and runing costs can be reconfigured so as to supply a comeptitve advantage for the concern.

An illustration of this analysis likely being used by Just Us was when they decided to outsource their packaging to “The Flower Cart. which provides vocational services to mentally challenged grownups. ” ( Just Us instance survey )

2. 0 Current Selling Scheme

2. 1 Product Life Cycle:

For selling intents PLC is an of import tool. argues Lancaster and Massingham. ( 1996 ) because it can be really utile for placing alternate strategic picks. ( Appendix 1 ) Since. the analysis is specifically for Just Us Cafes. the PLC ( Product Life Cycle ) in this instance is applied on the cafe market as a whole. and non on the single merchandises sold in the cafe .

Harmonizing to the analysis until now. it is apparent that the market is in its early adulthood phase. where the rivals are high. and any inefficient competition is eliminated. The gross revenues are good but the net incomes are traveling down and everyone is contending for market portion. At this point. it is critical for Promotional trades to be implemented and keep trade name trueness.

2. 2 BCG Matrix:

Doole and Lowe ( 2012 ) stated that BCG Matrix is chiefly designed to understand the current strategic place of the company. its merchandises. merchandises of its rivals. and helps in placing future strategic options. Just Us has a good merchandise portfolio. hence it is imperative to look at each merchandise separately for its profitableness and future chances it can supply to the concern. This will enable Just Us to implement a more relevant Marketing scheme.

After careful analysis of the merchandises. the undermentioned categorization can be provided:

Stars: Tea
Dogs: Sugar
Cash Cattles: Cocoa and Coffee
Question Mark: None

Merely Us needs to look more closely at the sugar market and analyze whether it should be discontinued shortly or non. since it is a Canis familiaris. but if it adds value to the merchandise portfolio so it should be kept unless its non executable to make so.

Westwood ( 2002 ; pg. 100 ) . suggests that that the ideal development of merchandises for a concern is in the sequence of change overing “question Markss into stars. and for these stars to finally go hard currency cattles. Cash cattles and unsuccessful inquiry Markss will finally go Canis familiariss. ”

2. 3 The Marketing Ps:

The Marketing Mix basically centres on Ps of Marketing. Most of the analysis has already been performed on the selling mix. but a brief sum-up of each P is given below in short points.

Merchandise: Just Us is a merchandise centered concern. selling a Premium quality merchandise. They sell everything organic and just trade. which is the nucleus merchandise.

Monetary value: The pricing policy implemented is premium pricing. Sue to the high costs of the premium merchandises being offered

Promotion: There is deficient selling budget. and may be Just Us could hold done better in last few old ages if they have had some selling personal specifically and promoted their trade name good.

For now. JUDES and their museum and cafe installation seem to be advancing themselves to some extent. They are making merely a selected subdivision of the market. Most of their advertizement is based on newspapers and wireless interviews providing the local audiences merely. They have some pupil price reduction verifiers and point of purchase advertisement on particular occasions such as Easter. Valentine’s twenty-four hours and Christmas.

Promotional scheme is really limited and is no manner plenty for the concern to do effectual impact in the market.

Topographic point: Concentrated cafe locations. They need to spread out in long term to derive market portion.

2. 4 Rival Analysis
From the information mentioned in the instance survey. it is clear that Just Us has many rivals in every distribution channel that they operate in. In Local Market their chief rival if Kicking Equus caballus. based on west seashore on Canada. British Columbia.

Using distinction method they leverage the vicinity and heritage of their base into their merchandises. They are besides utilizing indorsements and e-commerce solution really efficaciously which Just Us still lacks. The Local scheme has worked with the kicking Equus caballus and it would make good to Just Us if they can explicate a similar competitory scheme.

Brief analysis of Just Us and its rivals is given below:

1-Just Us
Channelss of Distribution: Coffee stores. universities. epicure stores. supermarkets Locations: Canada
No. of Shops: 4 coffeehouse and on the shelf

2- Kicking Horse
Channelss of Distribution: Coffee stores. universities. epicure stores. eating houses Locations: West seashore Canada. Quebec and Ontario
No. Of Shops: N. A

3- Kraft Foods
Channelss of Distribution: Shops. universities
Locations: U. S
No. Of Shops: Mainstream

4- P & A ; G Millstone
Channelss of Distribution: Mainstream
Locations: U. S and Canada
No. Of Shops: Mainstream

5- Nestle
Channelss of Distribution: Mainstream
Locations: U. S and Canada
No. Of Shops: Mainstream

6- Loblaws Pvt Label
Channelss of Distribution: Loblaws shops
Locations: Canada
No. Of stores: Mainstream

7- Trident bookseller and cafe
Channelss of Distribution: java store
Locations: Halifax and Nova Scotia
No. Of Shops: N. A

8- Java Factory
Channelss of Distribution: java store
Locations: Canada
No. Of Shops: 3

9- Tim Hortens
Channelss of Distribution: Restaurant
Locations: Canada
No. Of Shops: 170

10- Second Cup
Channelss of Distribution: java store and retailor
Locations: Canada
No. Of Shops: 360

Short-run Strategy
After a careful analysis of the state of affairs Just Us is in. the selling scheme can be divided between the short term and long term.

It is best for the concern presently to concentrate on its nucleus competences and demo them off to its clients. It is one of the registered just trade organisations. but harmonizing to the promotional stuff shown in the instance survey. it is deadening and it makes no usage of its competence. It should include the Canadian just trade symbol on all its promotional stuffs and stores. and merchandize. This would assist is set uping the trade name as more premium so its rivals. hence giving them an border.

They should lodge to their concentrated markets presently. illustration. Nova Scotia and Halifax. While making so. the retail distribution can be given more accents and good dealingss with them should be maintained so as to non free the retail sector.

The company can so easy concentrate on merchandise development. Possibly taking a expression at the bill of fare of other rivals would be a good thought. and developing a competitory bill of fare would assist in conveying more clients. The more assortment there is the more it can provide for different gustatory sensations. Possibly an indorsement with a famous person chef from one of the Television shows like Top Chef would assist every bit good.

This may be a defensive scheme. but it is suited here to extenuate the launch of an onslaught from a rival.

Long Term Strategy

“Brand Improvement and Expansion”

First. Lashkar-e-Taibas look at the trade name betterment portion of the scheme. Just Us is already a recognized trade name but it still needs betterment. particularly in the designing of the promotional stuff and advertisement channels.

Their trade name is known locally. they need to spread out their trade name acknowledgment to other markets before they expand at that place. This would extenuate the hazard of fring the market. like the instance of their Toronto cafe .

They have a good java narrative. they need to state it to everyone to do them link emotionally with the trade name. They can develop a clear MARCOMS theoretical account. which refers to different channels of communications. such as – advertisement. public dealingss. personal merchandising and gross revenues publicity.

It will give them an chance to beef up the trade name and asseverate their peculiarity. They will hold to seek to understand what the client has to state as opposed to executing. which relates to how the message is received ( West. Ford and Ibrahim 2006 ) .

Possible enlargement scheme could be through Franchising or organic growing of the concern. If franchising seems a feasible option in close hereafter so it can be taken P to increase market portion in short clip. but the values and nucleus competences have to remain the same. After all. Just Us is about “People and Planet before Net income

Mentions

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