Neptune Gourmet Seafood is faced with the issue of increased supply in its market. The response action is really clip sensitive as a failure to respond may do terrible loss in trade name perceptual experience. Though they have increased investings as of late to bring forth more and besides maintain high quality merchandises through their freeze engineering. they still need to happen a manner to battle long-run supply issues. They should non endanger their high trade name image through low cost manoeuvres. as this is the cardinal driver of their competitory advantage. The recommendation I propose is to spouse with really good known addendum retail merchant GNC to get down sole production of fish oil.

On top of that. Neptune should urge to GNC in the partnership that they expand to the immature and approaching market of frozen healthy repast bringing. GNC can spouse with a smaller company that has already established their healthy repast programs. such as MagicKitchen. com. Using GNC’s distribution and selling art. both Neptune and GNC will be able to prolong competitory advantages through high trade name equity and first mover advantages in a little. yet poised to turn market. As the universe starts to go more wellness witting. it will be a immense competitory advantage to hold already set up the right substructure to tack this market. Industry Dynamics

Neptune Gourmet Seafood is North America’s third largest seafood manufacturer playing in a market where seafood is considered high-end. They have generated about a 3rd of its gross from selling frozen and processed fish through US food market ironss and organic nutrient retail merchants. An even bigger market is through the many eating houses within 250 stat mis of Fort Lauderdale that they sell to ; along with many large sail lines. The concluding tierce of their market was through jobbers who so sold the fish to eating houses across the state. Neptune was considered top quality. and hence demanded a 30 % premium over the bulk of its rivals. They demanded this premium due to their investings in new ships and stop deading engineerings that allowed them to happen the biggest and best gimmicks along with administrating their top notch stop deading agents to maintain fish fresh. Some clients even preferred their frozen fish to fresh fish. Situation Analysis

Neptune Gourmet Seafood is in a tough state of affairs where they continue to hold excess stock list although demand for their merchandise is increasing. They have late become more productive through both investings in new stop deading engineerings every bit good as new authorities ordinance coercing them to deeper Waterss where they are holding more successful gimmicks. After analysing their current market state of affairs. some possible chances have been unveiled ( Appendix A ) that could perchance rectify their current quandary. These chances are coordinated with the company objectives. but it is clear that non all will be optimum due to countervailing industry conditions. The directors and determination shapers at Neptune Gourmet Seafood have each begun to differ about the proper class of action to outdo sustain a competitory advantage. ( Appendix D ) These issues come down to three chief countries: Inventory Degrees: Is this a short-run job that will go through with clip or is it a strategic job that must be addressed now to avoid long-run harm. Pricing Scheme: Will a 50 % price reduction aid to free of extra stock list or will it merely cut down net incomes? Will net incomes be hurt in the long term? Brand Awareness: Should the trade name equity of Neptune Gold be jeopardized with the creative activity of a secondary Neptune Silver trade name? What other chances could be explored to increase the trade name consciousness and trade name equity of Neptune as a whole.

After executing a SWOT analysis ( Appendix C ) it became clear that the creative activity of a secondary price reduction trade name would non merely ache the repute of Neptune but besides cut into its ain gross revenues. Furthermore. the increasing supply of fish due to new ordinance makes it clear that this job is non something that will merely travel away by casting a spot of stock list. It is an issue that needs a long-run solution in order to prolong a competitory advantage. whether that is in another market with a different merchandise. or some other long-run scheme. ( Appendix B ) . For that ground. the thought of enlargement to the fish oil market with a partnership with GNC has emerged. This will be able to free of extra stock list as supply additions while besides tapping into a budding demand market. ( Appendix E2 ) . Further. they should utilize their frozen fish to supply the seafood for GNC enlargement to the frozen repast bringing market. GNC can spouse with MagicKitchen. com to use there already in topographic point bill of fare ( Appendix E4 ) while utilizing the distribution. advertisement. and mark market that GNC already obtains. Importance of Decision

The whole seafood production market is confronting a hard job of how to cover with increased supply. The response that Neptune takes is critical to its long-run solvency as a trip may put them back compared to their rivals. Due to its historical success along with a recognizable and sure trade name. Neptune’s clients expect no alteration in the position quo. Any negative spillover onto their current merchandise or merchandise mix may bring on a negative client response. Furthermore. a move to a low cost trade name may ache their trade name image beyond fix. Evaluation Standards

Speed: how fast will the alternate reference and rectify the excess issue? Growth: will the alternate continue growing in current/new markets? Resource Use: will the alternate usage current resources or necessitate new investings? Quality: will the quality of merchandise be reduced through the alternate? Competitor Response: will the alternate start a monetary value war? Customer Response: will the alternate affect client perceptual experience of high quality? Supply Inventory: will the alternate reference the addition in supply in short and long-run? Options

Neptune is at a point in which action is required. A “do nothing” scheme would about surely put them in a hole that would non let them to vie long term in this industry. The option of a monetary value cut does non aline with their nucleus values. and hence the undermentioned three options were considered: 1 ) . Make a Neptune branded concatenation of high-end Seafood eating houses located along the Florida Coast. Professionals:

Get’s rid of extra supply
Maintains high quality trade name perceptual experience
Additions gross while making a testing land for new merchandises Cons:
Large investing edifices and deriving eating house experience Directly viing with a big part of client base
2 ) . Form a partnership with GNC and get down production of fish oil tablets and urge enlargement into preplanned frozen repast market where Neptune would be sole provider of fish. ( Further spouse with MagicKitchen. com ) . Professionals:

Long term solution for addition in fish supply
Extends trade name to another market. non-seafood feeders
GNC already understands procedures to create/has distribution GNC has distribution system in topographic point for frozen sector. already has mark market every bit good Cons:
GNC features many trade names of fish oils already
Possible cannibalization with GNC advised frozen repast programs
3 ) . Make a mass-market trade name called Neptune Silver that sells at lower cost through the same distribution channels. Professionals:
Addresss supply job now and in the hereafter
Attracts new lower terminal client base
Cons:
Decreased gross
Brand perceptual experience is lowered. may lose high-end client base every bit good Possible lost ability to bear down a premium in the high-end market Alternatives Evaluation Matrix

Recommendations
Short-run – Tactical: With the excess of stock list increasing every twenty-four hours. Neptune must fix its transit services to get down regular bringings to GNC’s fabrication site. Long-run – Strategic: Neptune must take action in a few different countries if they are to be successful. Based on the options matrix. the joint venture with GNC gives them the biggest chance to retain a competitory advantage. The current growing of the fish oil industry shows the tendency that more and more consumers are get downing to care about their length of service in wellness. Furthermore. the repast program enlargement recommendation to GNC helps to derive another competitory advantage in the pre-planned healthy repast industry. They must fix an offer to GNC sketching the chances for GNC and the possible market incursion that they can accomplish through this partnership. They will besides urge partnering with already in topographic point frozen healthy repast bringing services such as MagicKitchen. com. The healthy frozen repasts industry is turning and doesn’t have a batch of participants. First mover advantages will be acquired and flourished with the graduated table and distribution GNC already has in topographic point. Key Implementation Actions

1 ) . Get down hebdomadal or monthly conveyance of specified sum of excess fish to be used for fish oil at foremost until partnership with frozen repast squad is acquired. 2 ) . Fish oil production will get down at GNC production site. get down marketing and advertisement runs. 3 ) . Once GNC has partnered with a frozen repast supplier. they must get down the selling and advertisement to assist convey the wellness witting clients of GNC together with the convenience of frozen repasts. 4 ) . MagicKitchen. com can use GNC distribution systems to present low dealing costs Impact to Resources and Capabilities on Competitive Advantages The impact of this partnership is an sweetening to both companies’ competitory advantages. Neptune is able to non merely keep its high quality perceptual experience but besides penetrate a turning market of fish oil and pre-planned healthy frozen repasts.

GNC will be able to spread out its merchandise mix by perforating the busy yet wellness witting persons. This is a market that is sustainable and turning due to the addition of information available about healthy eating wonts and the importance of nutrient to length of service. The groups of wellness witting people are besides great trade name embassadors. and are driving selling attempts and demand for merchandises through their usage of societal media ( Appendix E5 ) . Furthermore. through the partnership GNC will salvage on transit costs and other costs by using Neptune as its exclusive fish provider. Expected Competitor Response

Due to the common issue of increased supply throughout the market. it is likely that other rivals will be seeking to happen other mercantile establishments to prolong a competitory advantage. However. due to the deficiency of premium trade name acknowledgment it will be hard for them to do such big partnerships. Neptune’s increasing borders over the past few old ages are giving it ample hard currency to do these large trades. The rivals will probably seek to free extra stock list through monetary value cuts or charitable giving. Appendix

A ) . Market Expansion Grid
B ) . Porter’s Five Forces
C ) . SWOT Analysis
D ) . Stakeholder’s Analysis
Tocopherol ) . Exterior Research

A ) Market Expansion Grid
B ) Porter’s Five Forces
C ) . SWOT Analysis
D ) Stakeholder’s Analysis
Tocopherol ) . Exterior Research

E1. Finding New Uses Fish Byproducts Report hypertext transfer protocol: //www. Ars. Department of Agriculture. gov/is/ar/archive/apr07/fish0407. pdfGlobal demand for fish protein will transcend supply by 2016 “Fish oil and protein addendums for worlds can be made from high-fat livers. And low-fat livers. such as salmon. can be used as addendums for pets and farm animal every bit good as worlds. ” E2 ) . Grandview Research Industry Report: Fish Oil Market

Global fish oil demand approaching $ 2 billion and expected to turn at 9 % between now and 2014 The major driver of this growing is the addition in direct human ingestion based on increased wellness benefit consciousness and concern of general population. Not adequate production to maintain up with the increasing demand. E3 ) . Global Frozen Food Market Report

hypertext transfer protocol: //www. foodproductdesign. com/news/2013/09/global-frozen-food-market-to-reach-294-billion-by. aspxManufacturers happening more and more demand from organic and natural frozen market Overall market anticipating about 15 % addition by 2019

E4 ) . Possible Partners for Frozen Meals for FNC
hypertext transfer protocol: //www. magickitchen. com/press_releases/Local-Partner-Program. htmlDelivery of frozen healthy repasts to single doors Could make bulk bringings to GNC for mass pickup and low costs E5 ) . Health Conscious Shoppers edifice trade names

hypertext transfer protocol: //socialtimes. com/health-conscious-shoppers-become-powerful-brand-advocates-infographic_b149137More healthy people. more trade name acknowledgment and driving demand. Infographics: