ASAP TO RATE HIGH

Application Exercise

There are many uncertainties when running a business and TBSL has certainly seen their fair share of unexpected issues. Judging from hindsight, they admit they could have foreseen some of the surprises; some would have been predictable if they had added experience, and some were simply not predictable at all. The difficulty with planning is that you have to make decisions well in advance without complete data. Simply put, you don't know exactly what will happen in the future, and yet, what happens in the future can have dramatic consequences for your business. While it is likely you will get more detailed exposure to business planning in future courses, let's take an initial look into marketing planning that integrates the course material.

Recall in Chapter 3 we discussed how the environment affects marketing decisions. One of the environmental issues TBSL faced was the potential for significant increases in price and shortages in vanilla from Madagascar, the primary source of vanilla in the world. Increasing demand from other companies combined with drought or poor growing conditions could mean shortages of one of TBSL's most important ingredients. How could TBSL plan for such a contingency? Answer the following questions and develop a mini-contingency plan for TBSL just in case they face a situation of vanilla bean shortages from Madagascar.

1. Product problem: What would be one specific product issue TBSL would face if they could not get their needed supply of vanilla beans? Plan: Suggest one step TBSL could use to address this product problem. (Hint: If they cannot get real vanilla beans in the quantities needed to meet demand, how could they or would they change their product(s) to address this problem?)

2. Place problem: What would be one specific place issue TBSL would face if they could not get their needed supply of vanilla beans? Plan: Suggest one step TBSL could use to address this place problem. (Hint: If they cannot get real vanilla beans in the quantities needed to meet demand, how could they or would they change their place options to address this problem? Could they limit which customers get vanilla-based bars? How?)

3. Price problem: What would be one specific price issue TBSL would face if they could not get their needed supply of vanilla beans? Plan: Suggest one step TBSL could use to address this price problem. (Hint: If they cannot get real vanilla beans in the quantities needed to meet demand, how could they or would they change their price(s) to address this problem?)

4. Promotion problem: What would be one specific promotion issue TBSL would face if they could not get their needed supply of vanilla beans? Plan: Suggest one step TBSL could use to address this promotion problem. (Hint: If they cannot get real vanilla beans in the quantities needed to meet demand, how could they or would they change their promotion to address this problem? Would they promote differently by focusing on other flavors, or should they explain the shortage in some way to customers through promotion? How?)

5. Participation problem: What would be one specific participation issue TBSL would face if they could not get their needed supply of vanilla beans? Plan: Suggest one step TBSL could use to address this participation problem. (Hint: If they cannot get real vanilla beans in the quantities needed to meet demand, how could they or would they change their participation to address this problem? Given their focus on malnutrition, could they encourage customers to participate in some way that might help areas hit by the drought, or could they use the shortage to highlight their malnutrition cause in some other way? How?)

Address how each of the problem's explained above should be addressed in TBSL's contingency plans and why. Rank order the importance of each item in the contingency plan.