PLEASE HELP!!!

Anson Sweet and Margo Turner revived the old Detroit City Soda (DCS) brand in 2014 with a new small-batch, artisanal soda brewery located in the city. Their goal is to return the humble soda to its old roots and lean on the nostalgia for the brand and the Motor City. The soft drink market, Sweet explained, "is dominated by massive brands with sweeteners and refined sugars, fake flavors, and phony colors." DCS products are brewed naturally using raw cane sugar and herbs, spices, fruits, and botanicals locally sourced in Michigan. These drinks are for the person who wants nuance, subtlety, depth of flavor and a more authentic experience. Their line-up of sodas also leans on the city's history and its civic pride. Products include "Cadillac Cola," and "Woodward Wild Cherry Cream" which is flavored with sour Michigan cherries. Sales of DCS are currently at $7,000,000 USD annually via a collection of small retail partners throughout Michigan who purchase cases of 12 for $37.50 US and then sell individual bottles for $4.00 US. Eager to continue this growth, the pair are eying an expansion into Southwestern, Ontario. They quickly recognize their production is presently at capacity, however. This leaves them with a hard choice to make. They see two paths forward: The first option is to expand their current operation, renting a smaller property adjacent to their current production facility for an annual lease of $15,000 USD. Four employees, each earning $13.50 USD per hour, will handle the bottling and packaging of the soda for shipment. The cost of ingredients and materials are $12.00 USD per case of 12 bottles. Sweet and Turner will earn a combined salary of $80,000 USD for their work as brand managers and soda brew masters. A full-time salesperson to cover the SW Ontario area would also need to be hired at an annual cost of $52,000 USD and a modest promotional budget of $750,000 USD is allocated as well. Sweet and Turner estimate that this new production setup will allow them to produce an additional 120 cases of soda in an eight-hour shift. The second option is to outsource Canadian production. Amalgamated Beverage (AB) in Hamilton currently handles the production of other carbonated beverages, offering cost savings via modern food science and efficient operations. AB would replicate the flavors of DCS's products, developing a flavor syrup formula for the new product (they have a minimum production order of 12,000 bottles). The production cost is $.60 CAN/bottle. This will include bottling, labeling, and packing into cases of 12. There would also be an additional fee of $9.00 CAN/case for shipment within the province of Ontario. Sweet and Turner will collect a combined salary of $80.000 USD as brand managers, and a Canadian sales agent charging a yearly fee of $65,000 CAN is required. The promotional budget remains the same The current exchange rate is $1 USD = $1.28 CAN. While the cost of a bottle in the American market is $4.00 US, market research suggests the Ontario consumer is only willing to pay $4.50 CAN per bottle for a premium gourmet soft drink. Sweet and Turner plan to keep the per-case cost the same. Using the above information and your own insights and application of the course material, please answer the following: a. Compare the two plans quantitatively - what are the breakeven cases for each option? Then consider their qualitative factors and recommend an option for DCS, consistent with their brand, strategy, and objectives. Make sure to explain your reasoning. (12 marks) b. In lieu of an Ontario expansion, the pair could instead leverage the DCS brand with new products to continue their growth. With that in mind, describe one brand extension, one co-branding partnership, and one brand licensing opportunity that they might pursue in their current marketplace. For each, explain why it is a workable and worthwhile. Please be specific. (6 marks) Anson Sweet and Margo Turner revived the old Detroit City Soda (DCS) brand in 2014 with a new small-batch, artisanal soda brewery located in the city. Their goal is to return the humble soda to its old roots and lean on the nostalgia for the brand and the Motor City. The soft drink market, Sweet explained, "is dominated by massive brands with sweeteners and refined sugars, fake flavors, and phony colors." DCS products are brewed naturally using raw cane sugar and herbs, spices, fruits, and botanicals locally sourced in Michigan. These drinks are for the person who wants nuance, subtlety, depth of flavor and a more authentic experience. Their line-up of sodas also leans on the city's history and its civic pride. Products include "Cadillac Cola," and "Woodward Wild Cherry Cream" which is flavored with sour Michigan cherries. Sales of DCS are currently at $7,000,000 USD annually via a collection of small retail partners throughout Michigan who purchase cases of 12 for $37.50 US and then sell individual bottles for $4.00 US. Eager to continue this growth, the pair are eying an expansion into Southwestern, Ontario. They quickly recognize their production is presently at capacity, however. This leaves them with a hard choice to make. They see two paths forward: The first option is to expand their current operation, renting a smaller property adjacent to their current production facility for an annual lease of $15,000 USD. Four employees, each earning $13.50 USD per hour, will handle the bottling and packaging of the soda for shipment. The cost of ingredients and materials are $12.00 USD per case of 12 bottles. Sweet and Turner will earn a combined salary of $80,000 USD for their work as brand managers and soda brew masters. A full-time salesperson to cover the SW Ontario area would also need to be hired at an annual cost of $52,000 USD and a modest promotional budget of $750,000 USD is allocated as well. Sweet and Turner estimate that this new production setup will allow them to produce an additional 120 cases of soda in an eight-hour shift. The second option is to outsource Canadian production. Amalgamated Beverage (AB) in Hamilton currently handles the production of other carbonated beverages, offering cost savings via modern food science and efficient operations. AB would replicate the flavors of DCS's products, developing a flavor syrup formula for the new product (they have a minimum production order of 12,000 bottles). The production cost is $.60 CAN/bottle. This will include bottling, labeling, and packing into cases of 12. There would also be an additional fee of $9.00 CAN/case for shipment within the province of Ontario. Sweet and Turner will collect a combined salary of $80.000 USD as brand managers, and a Canadian sales agent charging a yearly fee of $65,000 CAN is required. The promotional budget remains the same The current exchange rate is $1 USD = $1.28 CAN. While the cost of a bottle in the American market is $4.00 US, market research suggests the Ontario consumer is only willing to pay $4.50 CAN per bottle for a premium gourmet soft drink. Sweet and Turner plan to keep the per-case cost the same. Using the above information and your own insights and application of the course material, please answer the following: a. Compare the two plans quantitatively - what are the breakeven cases for each option? Then consider their qualitative factors and recommend an option for DCS, consistent with their brand, strategy, and objectives. Make sure to explain your reasoning. (12 marks) b. In lieu of an Ontario expansion, the pair could instead leverage the DCS brand with new products to continue their growth. With that in mind, describe one brand extension, one co-branding partnership, and one brand licensing opportunity that they might pursue in their current marketplace. For each, explain why it is a workable and worthwhile. Please be specific. (6 marks)