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Q Search United Beverages, Inc. H Income Statement (amounts in thousands) 00 0-0-0-0-0-0-0-0-0-0-8 -8- Exhibit 1 UNITED BEVERAGES: PRODUCT DEVELOPMENT GENIUS OR ONE-HIT WONDER? United Beverages Selected Financials (2002) = C File | C:/Users/yashr/Downloads/United%20Beverage%20-%20Product%20Development%20.PDF United Beverages: Product Development Genius or One-Hit-Wonder? 8/13 75% UV0900 Month Ended Net Revenue 31-Jan 28-Feb 31-Mar 80-Apr 31-May 4,114 4,104 4,110 30-Jun 31-Jul 31-Aug 30-Sep 31-Oct 30-Nov 31-Dec 4,101 4,102 4,102 4,114 4,105 4,108 4,110 4,114 4,109 Cost of Revenue 2,756 2,750 2,754 2,748 2,748 2,748 2,756 2,750 2,752 2,754 2,756 2,753 Gross Margin 1,358 1,354 1,356 1,353 1,354 1,354 1,358 1,355 1,356 1,356 1,358 1,356 Operating Expenses S, G, and A 494 492 493 492 492 492 494 493 493 493 494 493 R&D / NPD 329 328 329 328 328 328 329 328 329 329 329 329 Total Operating Expense 823 821 822 820 820 820 823 821 822 822 823 822 Operating Income 535 534 534 533 533 533 535 534 534 534 535 534 3/20/2023 11:34 PM + EJ Y III = TEDEO C sf H G > File | C:/Users/yashr/Downloads/United%20Beverage%20-%20Product%20Development%20.PDF United Beverages: Product Development Genius or One-Hit-Wonder? 9 7 9/13 75% + | 8 SPIDER MA 6C Clear Q Search -9- Exhibit 2 UNITED BEVERAGES: PRODUCT DEVELOPMENT GENIUS OR ONE-HIT WONDER? The GangBusters Product Line TIN UV0900 + 11:34 PM 3/20/2023 6C Clear III = 8 C e sf H G > File | C:/Users/yashr/Downloads/United%20Beverage%20-%20Product%20Development%20.PDF United Beverages: Product Development Genius or One-Hit-Wonder? 10 / 13 75% + H + Exhibit 3 UNITED BEVERAGES: PRODUCT DEVELOPMENT GENIUS OR ONE-HIT WONDER? Total U.S. Retail Sales by Brand BEVERAGES: JUICE/FRUIT DRINKS TOTAL U.S. RETAIL SALES BY BRAND 52 WEEKS ENDING 12/31/2002 Rank Dollar Sales CAPRI SUN GATORADE 338,708,172 190,184,255 Units Sold 179,865,85 Price/Unit 1.88 HI-C 115,491,369 60,996,022 51,623,576 3.12 GATORADE FROST 60,968,962 17,092,021 3.57 CRYSTAL LIGHT 50,174,257 14,077,239 3.56 6 GANG BUSTERS 49,293,568 21,851,283 2.26 KOOL-AID JAMMERS 48,547,696 MINUTE MAID 37,673,797 MINUTE MAID COOLERS 36,569,282 23,713,561 26,503,805 14.687.497 2.05 1.42 2.49 10 HAWAIIAN PUNCH 31,080,362 11 PRIVATE LABEL 26,718,739 12 OCEAN SPRAY 13 KOOL-AID BURSTS 23,720,249 22,505,338 18,588,751 15,317,983 10.600.160 1.67 1.74 2.24 21,094,365 1.07 14 MINUTE MAID EXTREME COOLERS 21,847,295 9,140,530 2.39 15 POWERADE 19.030.638 14,120,074 1.35 16 SOBE 8 14,979,807 12,011,925 1.25 17 NANTUCKET NECTARS 11,995,991 1,664,449 7.21 18 GATORADE ICE 8,819,913 7,643,481 1.15 FRUIT WORKS 8,749,124 8,212,728 1.07 20 SNAPPLE 6,062,151 5,138,558 1.18 21 TANG 5,535,787 1,195,947 4.63 DOLE 5,018,424 4,315,923 23 ODWALLA 4,961,934 1,709,108 2.90 24 COOL TOPZ 4,652,970 2,028,794 2.29 FRUITOPIA 4,650,899 4,169,110 1.12 26 SUNNY DELIGHT 4,407,216 2,343,091 1.88 27 SUNNY DELIGHT 3,728,018 2,286,397 1.63 MINUTE MAID 3,058,651 1,515,730 2.02 29 OLD ORCHARD 2,468,795 1,465,710 1.68 30 WELCH'S 2,318,354 1,048,195 2.21 31 CTL BR 1,825,797 583,327 3.13 32 TROPICANA TWISTER 1,809,314 748.835 2.42 33 COUNTRY TIME 1,320,089 1,182,351 1,182,361 1.12 34 OCEAN SPRAY SWEETIE 1,012,230 398,985 2.54 35 SOBE LEAN 948.426 745,588 1.27 36 TAMPICO 926,610 544,499 1.70 37 LIPTON BRISK 892,482 768,194 1.16 9 38 BORDEN 346,021 323,790 1.07 39 MISTIC 271,524 291,857 0.93 40 SOBE SPORTS SYSTEM 211,796 150.571 41 ELEMENTS 178,470 144,823 MAD RIVER 172,140 150,861 1.14 43 FAYGO 169.619 269,721 0.63 44 ANDERSON ERICKSON 161,342 127,938 1.26 SANTA CRUZ ORGANIC 152,130 51.277 2.97 46 MOUNTAIN SUN 139,710 36,451 3.83 47 FAIRMONT-ZARDA 89,836 74,215 1.21 48 ARIZONA 88.254 57,495 1.53 49 MEADOW GOLD 82,457 54,925 1.50 50 FIVE ALIVE 81,434 36,479 2.23 Source: ACNielsen Retail Measurement Insights 10 Q Search This document is authorized for use only by Stacy Novinski (novinski@msoe.edu). Copying or posting is an infringement of copyright. Please contact customerservice@harvardbusiness.org or 800-988-0886 for additional copies. H 11:34 PM 3/20/2023 III = 8 C sf H G > File | C:/Users/yashr/Downloads/United%20Beverage%20-%20Product%20Development%20.PDF United Beverages: Product Development Genius or One-Hit-Wonder? 10 6C Clear 11 Q Search 11/13 75% + | H -11- Exhibit 4 UNITED BEVERAGES: PRODUCT DEVELOPMENT GENIUS OR ONE-HIT WONDER? Bob Jones's First Sketch of the Dual-Drink Bottle SIDE puns (couries) GET US OUTSIDE DETAILS ATTACHMENT TO CHAMBE elTHER SNAD OR THEST 2 PARTING Ne SHUT OFFS CHAMBER SECTIONED EXPLPED VIEW VALVERD CAP ASSEMBLY LINER Tip CHAMBER ber us ANGLED OPENINGS FROM VALVES TO MIXING AREA. Eusur (MIXING CHAMBER AND CAP 2000 VALUE (2) RECHEUFE BOTTLE (EXISTING SimpleDui" for Masting 2-2603 UV0900 + 11:34 PM 3/20/2023 III = 8 C sf H G > File | C:/Users/yashr/Downloads/United%20Beverage%20-%20Product%20Development%20.PDF United Beverages: Product Development Genius or One-Hit-Wonder? 6C Clear 10 11 12 Q Search 12/13 75% + | H -12- Exhibit 5 UNITED BEVERAGES: PRODUCT DEVELOPMENT GENIUS OR ONE-HIT WONDER? Results of Preliminary Market Research UV0900 PRELIMINARY MARKET RESEARCH ANALYSIS (01/15/2003) QUNITED beverages CONFIDENTIAL - DO NOT DISTRIBUTE Assumptions: 1) Continued growth for GangBusters target customer segment (adolescents aged 9-14). 2) Cross-selling opportunity due to product familiarity with GangBusters. Preliminary Conclusions for Dual Drinks: 1) Potential market is 4-5 times current GangBusters market in the long-run. 2) Slower acceptance rate (focus group was unsure about product use and understanding). 3) Approximately 50% of survey respondents were "not sure" regarding the idea. Almost 25% of respondents expressed some sort of "positive" feedback. Preliminary Conclusions for Kid-Energy Drink: 1) Potential market is smaller than current GangBuster market. 2) Fast acceptance rate (focus group indicated easy product use and understanding due to the current market for energy drinks). 3) Approximately 80% of survey respondents expressed "positive" feedback. W + 11:34 PM 3/20/2023 Clear 6C 13 Q Search 12 11 10 = C File | C:/Users/yashr/Downloads/United%20Beverage%20-%20Product%20Development%20.PDF United Beverages: Product Development Genius or One-Hit-Wonder? 13/13 75% -13- Exhibit 6 UNITED BEVERAGES: PRODUCT DEVELOPMENT GENIUS OR ONE-HIT WONDER? Potential Development Projects Minimum Maximum Development Cost Development Time Development Time Potential Development Projects H United Beverages, Inc. Expected Total GangBusters Expansion Program $100,000/month guarantees the worst-case result. $300,000/month guarantees the best-case result. UV0900 Worst Case Result Best Case Result Marginal impact; competition gains ground; sales decline at 6% per month. Positive impact; competition does not gain; sales remain constant. O Moderately successful; Kid-Energy Drink Project $800,000 4 months 10 months monthly sales of $500,000 Very successful; monthly sales of $1,000,000 Dual-Drink Project $1,800,000 6 months 12 months 3/20/2023 11:34 PM Market failure; monthly sales are negligible Complete market success; monthly sales of $4,000,000 per month and growing + EJ Y Q Search United Beverages, Inc. H Income Statement (amounts in thousands) 00 0-0-0-0-0-0-0-0-0-0-8 -8- Exhibit 1 UNITED BEVERAGES: PRODUCT DEVELOPMENT GENIUS OR ONE-HIT WONDER? United Beverages Selected Financials (2002) = C File | C:/Users/yashr/Downloads/United%20Beverage%20-%20Product%20Development%20.PDF United Beverages: Product Development Genius or One-Hit-Wonder? 8/13 75% UV0900 Month Ended Net Revenue 31-Jan 28-Feb 31-Mar 80-Apr 31-May 4,114 4,104 4,110 30-Jun 31-Jul 31-Aug 30-Sep 31-Oct 30-Nov 31-Dec 4,101 4,102 4,102 4,114 4,105 4,108 4,110 4,114 4,109 Cost of Revenue 2,756 2,750 2,754 2,748 2,748 2,748 2,756 2,750 2,752 2,754 2,756 2,753 Gross Margin 1,358 1,354 1,356 1,353 1,354 1,354 1,358 1,355 1,356 1,356 1,358 1,356 Operating Expenses S, G, and A 494 492 493 492 492 492 494 493 493 493 494 493 R&D / NPD 329 328 329 328 328 328 329 328 329 329 329 329 Total Operating Expense 823 821 822 820 820 820 823 821 822 822 823 822 Operating Income 535 534 534 533 533 533 535 534 534 534 535 534 3/20/2023 11:34 PM + EJ Y III = TEDEO C sf H G > File | C:/Users/yashr/Downloads/United%20Beverage%20-%20Product%20Development%20.PDF United Beverages: Product Development Genius or One-Hit-Wonder? 9 7 9/13 75% + | 8 SPIDER MA 6C Clear Q Search -9- Exhibit 2 UNITED BEVERAGES: PRODUCT DEVELOPMENT GENIUS OR ONE-HIT WONDER? The GangBusters Product Line TIN UV0900 + 11:34 PM 3/20/2023 6C Clear III = 8 C e sf H G > File | C:/Users/yashr/Downloads/United%20Beverage%20-%20Product%20Development%20.PDF United Beverages: Product Development Genius or One-Hit-Wonder? 10 / 13 75% + H + Exhibit 3 UNITED BEVERAGES: PRODUCT DEVELOPMENT GENIUS OR ONE-HIT WONDER? Total U.S. Retail Sales by Brand BEVERAGES: JUICE/FRUIT DRINKS TOTAL U.S. RETAIL SALES BY BRAND 52 WEEKS ENDING 12/31/2002 Rank Dollar Sales CAPRI SUN GATORADE 338,708,172 190,184,255 Units Sold 179,865,85 Price/Unit 1.88 HI-C 115,491,369 60,996,022 51,623,576 3.12 GATORADE FROST 60,968,962 17,092,021 3.57 CRYSTAL LIGHT 50,174,257 14,077,239 3.56 6 GANG BUSTERS 49,293,568 21,851,283 2.26 KOOL-AID JAMMERS 48,547,696 MINUTE MAID 37,673,797 MINUTE MAID COOLERS 36,569,282 23,713,561 26,503,805 14.687.497 2.05 1.42 2.49 10 HAWAIIAN PUNCH 31,080,362 11 PRIVATE LABEL 26,718,739 12 OCEAN SPRAY 13 KOOL-AID BURSTS 23,720,249 22,505,338 18,588,751 15,317,983 10.600.160 1.67 1.74 2.24 21,094,365 1.07 14 MINUTE MAID EXTREME COOLERS 21,847,295 9,140,530 2.39 15 POWERADE 19.030.638 14,120,074 1.35 16 SOBE 8 14,979,807 12,011,925 1.25 17 NANTUCKET NECTARS 11,995,991 1,664,449 7.21 18 GATORADE ICE 8,819,913 7,643,481 1.15 FRUIT WORKS 8,749,124 8,212,728 1.07 20 SNAPPLE 6,062,151 5,138,558 1.18 21 TANG 5,535,787 1,195,947 4.63 DOLE 5,018,424 4,315,923 23 ODWALLA 4,961,934 1,709,108 2.90 24 COOL TOPZ 4,652,970 2,028,794 2.29 FRUITOPIA 4,650,899 4,169,110 1.12 26 SUNNY DELIGHT 4,407,216 2,343,091 1.88 27 SUNNY DELIGHT 3,728,018 2,286,397 1.63 MINUTE MAID 3,058,651 1,515,730 2.02 29 OLD ORCHARD 2,468,795 1,465,710 1.68 30 WELCH'S 2,318,354 1,048,195 2.21 31 CTL BR 1,825,797 583,327 3.13 32 TROPICANA TWISTER 1,809,314 748.835 2.42 33 COUNTRY TIME 1,320,089 1,182,351 1,182,361 1.12 34 OCEAN SPRAY SWEETIE 1,012,230 398,985 2.54 35 SOBE LEAN 948.426 745,588 1.27 36 TAMPICO 926,610 544,499 1.70 37 LIPTON BRISK 892,482 768,194 1.16 9 38 BORDEN 346,021 323,790 1.07 39 MISTIC 271,524 291,857 0.93 40 SOBE SPORTS SYSTEM 211,796 150.571 41 ELEMENTS 178,470 144,823 MAD RIVER 172,140 150,861 1.14 43 FAYGO 169.619 269,721 0.63 44 ANDERSON ERICKSON 161,342 127,938 1.26 SANTA CRUZ ORGANIC 152,130 51.277 2.97 46 MOUNTAIN SUN 139,710 36,451 3.83 47 FAIRMONT-ZARDA 89,836 74,215 1.21 48 ARIZONA 88.254 57,495 1.53 49 MEADOW GOLD 82,457 54,925 1.50 50 FIVE ALIVE 81,434 36,479 2.23 Source: ACNielsen Retail Measurement Insights 10 Q Search This document is authorized for use only by Stacy Novinski (novinski@msoe.edu). Copying or posting is an infringement of copyright. Please contact customerservice@harvardbusiness.org or 800-988-0886 for additional copies. H 11:34 PM 3/20/2023 III = 8 C sf H G > File | C:/Users/yashr/Downloads/United%20Beverage%20-%20Product%20Development%20.PDF United Beverages: Product Development Genius or One-Hit-Wonder? 10 6C Clear 11 Q Search 11/13 75% + | H -11- Exhibit 4 UNITED BEVERAGES: PRODUCT DEVELOPMENT GENIUS OR ONE-HIT WONDER? Bob Jones's First Sketch of the Dual-Drink Bottle SIDE puns (couries) GET US OUTSIDE DETAILS ATTACHMENT TO CHAMBE elTHER SNAD OR THEST 2 PARTING Ne SHUT OFFS CHAMBER SECTIONED EXPLPED VIEW VALVERD CAP ASSEMBLY LINER Tip CHAMBER ber us ANGLED OPENINGS FROM VALVES TO MIXING AREA. Eusur (MIXING CHAMBER AND CAP 2000 VALUE (2) RECHEUFE BOTTLE (EXISTING SimpleDui" for Masting 2-2603 UV0900 + 11:34 PM 3/20/2023 III = 8 C sf H G > File | C:/Users/yashr/Downloads/United%20Beverage%20-%20Product%20Development%20.PDF United Beverages: Product Development Genius or One-Hit-Wonder? 6C Clear 10 11 12 Q Search 12/13 75% + | H -12- Exhibit 5 UNITED BEVERAGES: PRODUCT DEVELOPMENT GENIUS OR ONE-HIT WONDER? Results of Preliminary Market Research UV0900 PRELIMINARY MARKET RESEARCH ANALYSIS (01/15/2003) QUNITED beverages CONFIDENTIAL - DO NOT DISTRIBUTE Assumptions: 1) Continued growth for GangBusters target customer segment (adolescents aged 9-14). 2) Cross-selling opportunity due to product familiarity with GangBusters. Preliminary Conclusions for Dual Drinks: 1) Potential market is 4-5 times current GangBusters market in the long-run. 2) Slower acceptance rate (focus group was unsure about product use and understanding). 3) Approximately 50% of survey respondents were "not sure" regarding the idea. Almost 25% of respondents expressed some sort of "positive" feedback. Preliminary Conclusions for Kid-Energy Drink: 1) Potential market is smaller than current GangBuster market. 2) Fast acceptance rate (focus group indicated easy product use and understanding due to the current market for energy drinks). 3) Approximately 80% of survey respondents expressed "positive" feedback. W + 11:34 PM 3/20/2023 Clear 6C 13 Q Search 12 11 10 = C File | C:/Users/yashr/Downloads/United%20Beverage%20-%20Product%20Development%20.PDF United Beverages: Product Development Genius or One-Hit-Wonder? 13/13 75% -13- Exhibit 6 UNITED BEVERAGES: PRODUCT DEVELOPMENT GENIUS OR ONE-HIT WONDER? Potential Development Projects Minimum Maximum Development Cost Development Time Development Time Potential Development Projects H United Beverages, Inc. Expected Total GangBusters Expansion Program $100,000/month guarantees the worst-case result. $300,000/month guarantees the best-case result. UV0900 Worst Case Result Best Case Result Marginal impact; competition gains ground; sales decline at 6% per month. Positive impact; competition does not gain; sales remain constant. O Moderately successful; Kid-Energy Drink Project $800,000 4 months 10 months monthly sales of $500,000 Very successful; monthly sales of $1,000,000 Dual-Drink Project $1,800,000 6 months 12 months 3/20/2023 11:34 PM Market failure; monthly sales are negligible Complete market success; monthly sales of $4,000,000 per month and growing + EJ Y
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