…. Kingsford Charcoal. Daniel Brockman Breanne Klose Elaine Ormonde-Hua Gizem Ozdemir Quyen Tran. http://kingsford.com. Ellsworth B. A. Zwoyer patented charcoal briquettes in 1897* Henry Ford made briquettes from wood scraps in 1920
Henry Ford, 1919 (Library of Congress, http://en.wikipedia.org/wiki/File:Henry_ford_1919.jpg)
Facilitate consumer interest in charcoal grilling
Expand beyond U.S.
Expand current product line
Target customers outside of the U.S.
Position product to correspond with local culture in new markets
Increases size of Kingsford\'s market
Production currently limited to 5 U.S.-based plants
Environmental and health regulations
of some regions
Clorox lacks experience outside North America
Insufficient information of international markets
5. In order to appropriately innovate, conduct market research to determine why consumers have switched from charcoal grilling to gas grilling
Except where noted, all information came from the case description, Narayandas and Wagonfeld, Kingsford Charcoal (2006), Boston, MA, USA: Harvard Business School Publishing.
Current production from 5 U.S. plants
Kingsford\'s plants operate at 80% of capacity
Kingsford\'s market share is 60%
100% = 80% * 1.25Current plants could supply a 25% increase in Kingsford sales
Production manager estimates:
New plant costs $50M
Permitting takes 3 years
Begin site selection and permitting
Next year, reconsider whether to build
Hearth, Patio and Barbeque Association (HPBA), https//www.hpba.org/statistics/barbecue-statistics/bbq-grill-shipments
When prices of competitors rose in 2000, Kingsford gained market share
For 1% increase in price relative to competition, Kingsford will lose approximately 4%-points to 8%-points of market share.
Market share: Kingsford sold 74% of charcoal in North America in 2009. (Clorox investors\' overview (March 2010) Oakland, CA, USA: The Clorox Company.)