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Gin—Spring 2012 Daniel Frazier Maddie Griffith

L. Gin—Spring 2012 Daniel Frazier Maddie Griffith . Category Definition. Total category sales: $369,201,600 2007 sales: $138,739,800 Average % item on deal: 18.2% Not highly penetrated Supplier has control of category No private label available Strong national brands

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Gin—Spring 2012 Daniel Frazier Maddie Griffith

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  1. L Gin—Spring 2012 Daniel Frazier Maddie Griffith

  2. Category Definition • Total category sales: $369,201,600 • 2007 sales: $138,739,800 • Average % item on deal: 18.2% • Not highly penetrated • Supplier has control of category • No private label available • Strong national brands • Many small “unique” suppliers

  3. Ad Hoc Base

  4. Audit Results Total Number of SKUs in Audit: 100

  5. Demographics • Income above $70,000 • 2-member households • No female head • Empty nesters • Senior citizens

  6. Demographics • Income above $100,000 • 2-member households • No female head • Affluent suburban spread • Established couples • Professional and managerial employees

  7. Demographics • Income above $70,000 • 2-member households • No female head • Affluent suburban spreads • Senior couples • Established couples • Professional and managerial employees

  8. Demographics • Income below $50,000 • Struggling urban cores • Childless younger families • Empty nest couples • African American (non-Caucasian) • Female & non-female head households • Not employed

  9. Category Scorecard

  10. Gross Margin Evaluation • Bombay Sapphire has highest gross margins overall • 200 mL: 57% • 750 mL: 45% • 1 L: 45% • Tanqueray has interesting gross margins • 200 mL: 54% • 375 mL: 47%

  11. Gross Margin Evaluation • 750 mL sizes had consistently higher gross margins • Spruce Road Spirits: 62% • Tanqueray #10: 58% • Hendricks: 56% • Corsair: 50% • Category is Cash Machine: • High gross margins • Medium sales volume

  12. Competing Brands & Private Labels • Very strong national brands with loyal customers in segmented markets • 5 biggest brands account for 60% of gin sales • No private label products in this region • Supplier has control over retailer; no outlet for leveraging this control

  13. Suggestions for Retailer MAINTAIN! • High gross margins • Increased category sales • Stock fewer SKUs • Reduced depth ≠ increased sales, but is an opportunity for higher gross margins • Leading brands are close substitutes

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