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Bags of Tea Audit Project. Rebecca Elliott Spring 2010. Supplier is in control of the tea market Strong Brands, Low Private Label. Leading Brand Demographics. Lipton Income: $20,000-$99,999 (pretty even) Household Members: +5 members Age: 35-65+ (pretty even) Race: Caucasian.

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bags of tea audit project
Bags of TeaAudit Project
  • Rebecca Elliott
  • Spring 2010
slide2
Supplier is in control of the tea market
    • Strong Brands, Low Private Label
leading brand demographics
Leading Brand Demographics
  • Lipton
  • Income: $20,000-$99,999 (pretty even)
  • Household Members: +5 members
  • Age: 35-65+ (pretty even)
  • Race: Caucasian
private label demographics
Private Label Demographics
  • Private Labels
  • Income: less $20,000-$49,999 (highest in $20,000)
  • Household Members: 3-4, +5 (pretty even)
  • Age: 45-54 (highest)
  • Race: Caucasian
importance of depth
Importance of Depth
  • SKUs: 101
  • WalMart- Joyce: 59
  • Target: 38
  • Harps- Weddington: 35
  • Walgreens- 6th: 6
  • Walgreens- School: 7
importance of depth1
Importance of Depth
  • Does store depth seem to follow a store location’s trade area demographics?
    • No, Walgreens tend to be more expensive in price compared to Walmart, and they have at least twice as many SKUs.
importance of depth2
Importance of Depth
  • Appropriate Role: Maintain/Grow
  • Sales Volume: $628,502,000
  • Household Penetration: 46.2
  • % Item Sold on Deal: 21.2%
strength of leading competing brands
Strength of Leading/Competing Brands
  • Dominate Brand: Litpon
  • Share of Facings by Manufacturer
    • WalMart: 55.9%
    • Target: 41.9%
    • Harps: 42.5%
    • Walgreens-6th: 50.0%
    • Walgreens-School: 50.0%
strength of leading competing brands1
Strength of Leading/Competing Brands
  • Gross Margins consistent with your “role” for the category?
    • Yes
strength of leading competing brands2
Strength of Leading/Competing Brands
  • SKU found in every store: Lipton Hot or Cold 48 pacK
private label opportunities
Private Label Opportunities
  • Private labels are not very strong in this category.
  • Stores that carry private labels:
    • Harps (Best Choice): margins around 60%
    • Walmart (Great Value): around 45%
    • Target (Market Pantry): around 40%
private label
Private Label
  • Private Label SKUs: 10
  • Total SKUs: 101
  • Private labels make up less than 1% of the total SKUs
private label opportunities1
Private Label Opportunities
  • Walmart, Target and Harps carry private label brands, but I would not say they are really committed to them. While Walgreens, doesn’t carry any private labels at all.
private label opportunities2
Private Label Opportunities
  • Private Labels are going to have a decreasing presence in this category
    • Although margins are good, Brand Names have to much power in the category. Lipton takes up half of shelve space.
    • Tea is an inexpensive product, which means having a private label, known for their low prices, would have little effect on the customers decision. Might as well by a well known tea like Lipton.
private label opportunities3
Private Label Opportunities
  • Recommendation for: Walmart
  • I would recommend that Walmart increase their emphasis on national brands. Although, private label have decent margins, the national brands, especially Lipton, dominate this category.
    • Because it is such an inexpensive item, buying private labels will not save the customer. Might as well get the well-known brand.
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