Trend research indicates that more and more consumers care about health and wellness. Accordingly, Hershey s is
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Trend research indicates that more and more consumers care about health and wellness. Accordingly, Hersheys is looking into launching a lowcalorie version made with the natural sweetener, Stevia. The new bar will be called Hersheys Lite, and will be available for sale to consumers at the same $ price point as regular Hersheys Retailers have agreed to work on the same margins as the regular Hersheys bars. However, it will cost the company $ to manufacture each bar of Hersheys Lite due to the more costly natural ingredients. The company will offer a $ coupon on the Lite bars, similar to that offered with regular Hersheys bars and expects similar redemption rates. Preliminary forecasts indicate that the company will sell million Hersheys Lite bars annually; however, of these sales will come from the cannibalization of an equal number of the regular Hersheys brand. In order to drive awareness and purchase of Hersheys Lite, you plan to spend $ million instead of the normal $ million. Based purely on the economics, would you advise
management to launch the new Hersheys Lite bar?
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
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