CLEAN SPRITZ

WHAT CONSUMER TRENDS ARE IMPACTING THE

CLEAN SPIRITZ BUSINESS?
The affecting trends are:-
Due to the economic recession of 2008, customers became more price sensitive and in a bid
to conserve resources, customers used fewer cleaning products, and replenished those
products at a slower rate than before

Consumers had become concerned about the potential harm posed by household cleaning
products and raised questions regarding short term and long term health consequences of
using chemical based and non bio-degradable cleaning fluids
DISCUSS THE INDUSTRY FACTORS THAT ARE
CHANGING
The industry factors are:-
Cleaner industry giving more priority to environmental issues and made it a key message on
packaging of their products
Cleaners devoting a large portion of their advertising budget to trade promotions with ad
campaigns focusing primarily on branding, product attributes and consumer lifestyles.
The recession of 2008 brought in a demand for cheaper products with small independent
brands recording highest revenue gains
WHICH ENVIRONMENTAL ISSUES ARE OF SIGNIFICANCE
TO CLEAN SPIRITZ?

The concerned issue are:-

Consumers concerned about health hazards associated with non bio-degradable cleaners and
impact of the packaging waste on environment

Growing demand for green products, less chemically invasive and more environmentally
friendly grew across various industries
 BASE CASE/STATUS QUO

Advantages Risks

Allow time to come up with Long time for the loyal

99% biodegradable spray customers to switch to
other brands
Save money on the re- No way to predict the
launch of the existing customers response for
product the new product after 12/24
Easy to slow down the months
production for the new Customers shifting to more
product to settle in the environment friendly ways
future of cleaning
RE-LAUNCH THE 3:1 CONCENTRATE

Advantages Risks
Less chemical concentration,
Reduced sales for dilute
reduced 45% packaging volume
sprays
resulting in less plastic usage
Products concept and strategy
Less thrown away spray
arent aligned with CleanSpritzs
bottles because of re-use
previous products
Consumers attention to Still not an environment
less harmless and more friendly product even with a
environment friendly less concentrated offering
offering (bottle)
 4:1 CONCENTRATION IN RECYCLABLE
POUCH

Advantages Risks

Benefit of 14% saving in Increased cost of

packaging production
Packaging material reduced by Possibility of being a messy
85% making it a lot less option and thus less
harmful option convenient for consumers
Easy promotional opportunity
for the product through Leakage/Spillage can cause
recycling influence environmental waste and
campaigns reduction in profits
4:1 CONCENTRATION WITH A DISSOLVABLE
PACKET

Advantages Risks

Benefit of 6% cost saving

Increased fees for display
and 90% volume reduction
to the company
in packaging
100% dissolution of packaging Transportation problem

Customer convenience Inconvenience to the

(easier to pour the liquid into customer because of the
the 32 oz. bottle) design
FINANCIAL PAYOFFS

Profit Before Net Profit after

Diluted 3:1 concentrate 4:1 Recycleable 4:1 Water Soluble Advertising Advertising
Total cost/container 1.75 3.4 1.5 1.65
Total cost/SU 0.7 0.68 0.6 0.66
Mfg Selling Price 5.87 10.46 5.18 5.18
SU per container 2.5 5 2.5 2.5
Mfg Revenue/SU 2.348 2.092 2.072 2.072
Mfg Profit 1.648 1.412 1.472 1.412
Mfg Profit as per current
80-20 29833767.73 6390364.083 36224131.81 27168098.86

Considering 4:1
recycleable
Profit from Profit from Profit from initial Profit Before Net Profit after
Diluted Profit from 3:1 Recycleable Pouch 1 million Advertising Advertising
Brand Team 11933507.09 6390364.083 7648154.304 1274000 27246025.48 18663527.45
Finance Team 5966753.546 6390364.083 3088076.416 1274000 16719194.05 11452647.92
RECOMMENDATIONS

Beaton should recommend extending the product line by launching 6.4 oz Recyclable rm
refill pouch
Currently, Diluted spray dominate the sales volume by 80%, so relaunching 3:1
concentrate will cannibalize the 80% sales volume
Recyclable refill pouch will also cannibalize the Diluted spray SKU but for the long term
will help company maintain profits as well as brand image, since, the refill pouch is
biodegradable