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eMerge Interactive, Inc.

eMerge Interactive, Inc. Sierra Howry Baltazar Prado Ross Pruitt. Description of the Case Situation. eMerge: A diversified agricultural technology company Two main product lines: CattleLog and VerifEYE Market Environment Technology and Development Sales and Marketing Customers

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eMerge Interactive, Inc.

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  1. eMerge Interactive, Inc. Sierra Howry Baltazar Prado Ross Pruitt

  2. Description of the Case Situation • eMerge: A diversified agricultural technology company • Two main product lines: CattleLog and VerifEYE • Market Environment • Technology and Development • Sales and Marketing • Customers • Intellectual Property Rights • Competition

  3. eMerge’s Problems • How does the company stay afloat until the market is ready? • What business strategy will allow them to increase the adoption rate of this technology?

  4. eMerge SWOT • Strengths • Exclusive license to unique intellectual property rights (VerifEYE) • First mover advantage with VerifEYE • VerifEYE works within existing HACCP regulations • Weaknesses • Lack of competitive advantage of CattleLog • CattleLog is not a stand alone piece of software • Difficult to measure monetary benefits from CattleLog

  5. eMerge SWOT • Opportunities • Ability of VerifEYE to evolve into more differentiated products (bioterrorism/fruits and vegetables) • Use by federal/state regulatory agencies • Divide and conquer potential food safety markets • Threats • Close substitutes that are less expensive than CattleLog and gaining USDA PVP certification • Inability to defend intellectual property rights (VerifEYE) • Lack of access to capital markets

  6. Strategic Directions SELL, SELL, SELL • Why Sell CattleLog? • Not a unique product • Too many close substitutes • Does not have a competitive advantage • Too dependent on government mandates • Too costly to redevelop CattleLog into a product that would be compatible with newer technology

  7. Strategic Directions Expand, Expand, Expand • Exploit the VerifEYE systems (CIS, Solo, and HandScan) to their full potential due to: • Uniqueness of systems • No direct competitors • Not relying on government mandates • Ability to be incorporated into industries other than agriculture • Currently having monopoly power with these products

  8. Strategic Recommendations • In order to expand, eMerge should take Solo and HandScan to: • Restaurants / Fast Food Industry • Governmental Health Inspectors • Insurance Companies • Grocery Stores • Food Processors • Hotels • Day Cares • Hospitals • Private Consumers • Bioterrorism

  9. Example: McDonald’s • Setup a round table discussion with McDonald’s corporate office for feedback

  10. McDonald’s Corporate Meeting • Show advantages of the VerifEYE systems such as: • Decrease food contamination from poor worker hygiene • Illustrate how the HandScan can determine contaminated areas to be cleaned on hands • Solo could be used to randomly scan the food preparation areas • Possible at the end of a shift or the end of the day • Solo can also scan utensils / condiment area

  11. McDonald’s Corporate Meeting • Utilizing Solo and the HandScan can help prevent the loss of revenue and protect reputation • Potential loss • Jack in Box lost estimated $160 million in first 18 months following contamination (Roberts, et al.) • The average award in foodborne illness lawsuits was $133,280 in 1998 (USDA ERS)

  12. McDonald’s Corporate Meeting • Test pilot program • Let McDonald's use the Solo and HandScan in a few of their franchises, so they can obtain feedback and see the benefits of these systems

  13. Strategic Recommendations • Thirty two percent of defendants in foodborne illness lawsuits are restaurants (USDA ERS) • Sell HandScan products to ensure employee compliance with sanitary regulations. • Sell Solo products to franchise managers as well as regional managers to ensure individual franchises meet corporate standards.

  14. eMerge’s Solutions • How does the company stay afloat until the market is ready? • Sell CattleLog • Further develop capabilities of VerifEYE • Bioterrorism • Fruits and Vegetables

  15. eMerge’s Solutions • What business strategy will allow them to increase the adoption rate of this technology? • Targeting McDonald’s to purchase VerifEYE techonologies • Will set standard for rest of restaurant industry • Governmental Health Inspectors

  16. References • Roberts, T., R.A. Morales, C.T. J. Lin, A. Caswell, and N.H. Hooker.  "Worldwide Opportunities to Market Food Safety."  Ch. 10 in Government and the Food: Economic and Political Effects of Conflict and Cooperation, eds. L.T. Wallace and W.R. Schroder, Boston: Kluwer Academic Publishers, 1997. • U.S. Department of Agriculture, Economic Research Service. Consumer Food Safety Behavior:Restaurants the Chief Target of Foodborne Illness Lawsuits. http://www.ers.usda.gov/Briefing/ConsumerFoodSafety/feature.htm, July 22, 2005.

  17. Questions

  18. Awards in Foodborne Illness Lawsuits Source: USDA ERS

  19. Primary Defendant in Foodborne Illness Court Cases Source: USDA ERS

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