Tootsie Roll Business Plan free essay sample

Tootsie Roll Tootsie Roll The Tootsie Roll Industries Incorporated began in Chicago 117 years ago. The founder of the business was a gentleman named Leo Hirschfield. He began making and selling the Tootsie Roll. Today the famous product is still being made according to the original recipe and formula. However, since its inception, the business has become incorporated. The primary production and consumption areas include the United States, Canada, and Mexico. However, the company sells its products in over 75 countries. While the Tootsie Roll is the oldest and perhaps the most well-known product, Tootsie has a fairly wide product range. Other products include Junior Mints, Charleston Chew, Dubble Bubble, and Dots to name a few (Goldberg, McDonell, Santhakumar, Wood, Marquardt, 2010). The purpose of this business proposal is to obtain a $17 million dollar loan to support a global marketing campaign for Tootsie Roll to stimulate growth and capture market share. This proposal provides an attached worksheet containing an income statement, cash flow statement, and balance sheet. We will write a custom essay sample on Tootsie Roll Business Plan or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page Additional information available is industry analysis and trends, strategic plan, risk assessments, technology plan, marketing plan, SWOT analysis, competition, management, and community plans. Industry Analysis and Trends Tootsie Roll Industries Inc. is in the confectionary industry. In the U. S. alone the industry averaged nearly 15 billion dollars in sales. Experts predict that the industry will increase to over 17 billion by 2015 (Goldberg et al. , 2010). Tootsie Roll claims approximately three percent of this market share. The confectionary industry has been very slowly increasing. However, the growth is consistent and quite predictable. Certain trends have been arising in the industry. Tootsie should be aware of, and adapt to the trends. Imported chocolate is more available and cheaper, and the demand overseas is slowly increasing. However, the price of sugar has been increasing in the recent years as well. Important trends in the industry include a demand for chocolate with health benefits. The demand for premium chocolate options is increasing. However, with an unconfident economy, people want to spend less money on non-necessary things such as candy. Tootsie Roll Strategic Position and Risk Assessment â€Å"The company has grown to become an exclusive candy company building on its brand name in its niche market of hard candy. Tootsie Roll accounts for approximately 3% market share in a candy market that has slow, predictable growth with U. S. industry sales rising 3. 9% in 2009. Strong consumer awareness of its brand name, line extensions, holiday offering, and periodic acquisitions allow Tootsie Roll to stay well-positioned and grow off its existing infrastructure† (Goldberg, McDonnel, Santhakumar, Wood, Marquadt, p. 2, 2013). Risk Assessment and SWOT Analysis of Tootsie Roll A SWOT Analysis shows the strengths of Tootsie roll as a strong reputable brand of candy, strong balance sheet, strong stable supply and demand of ingredients, and paid dividends over the past 65 years. Its weaknesses are a strong dependence on domestic sales, not investing cash back into the company, and a failure to disclose succession planning. Opportunities include and international expansion, new innovative products, and the use of organic chocolate. Threats consist of an increase in commodity prices, competition, and oral health care. Operations Tootsie Roll operations include legal requirements of their employees and contracts. They deal with established vendors, suppliers, and they comply with all applicable laws regarding employment practices. Technology Plan Technology trends domestic or international markets should be the same. The technology for making the Tootsie Rolls is domestically developed and applying these technologies to the international markets are keys to the name brand of the company. The products quality is catching the consumer’s eye as this product is steering to lower, midrange, and higher paid consumers. The way the technology is in place currently and the name recognition of our company will bring customers our way. Research and development of the domestic product to be the best quality product with continued development benefits the international companies globally. It does not stop there. Monitoring the competitor’s advancements keeps the development of our product through technology will keep this company on their toes to stay the leader in market. Marketing Plan The marketing plan for Tootsie Roll is to keep the strong company’s brand name. Production and expansion to serve multiple countries is a goal to keep and expand their competitive advantage. The increased spending in advertising will keep their brand name in the market. The prices have stayed the same to be competitive to keep their market shares Tootsie Roll is a mature product and will show the competition that they can keep their market shares while entering new markets to be available to more customers. The loyal customers have shown Tootsie Roll what a good product it is and help bring new customers to Tootsie Roll. The parents are the candy buyers for the children so they are marketed to make the sale. Competition Tootsie Roll Industries has been producing the same products with the same formula for over 100 years. Tootsie is also well-known for candies such as Andes mints, Junior Mints, Charleston Chew, Mason Dots, and Sugar Daddy. The Tootsie Pops made  the company  one of the largest lollipop producers in the world. However, during 2007 Tootsie Roll Industries’ profits declined meanwhile its competitors Wrigley, Hershey, Nestle, and Mars continue to increase their profits. Wrigley, Hershey, Nestle, and Mars were the three major companies that account for 60% of the industry. Tootsie Roll’s perceived value in its brand is a superior advantage that the industry holds against its competitors. As a consumer product company, Tootsie Roll Industries face intense competition for both retail shelf space and consumers’ dollars. Tootsie Roll has â€Å"done a masterful job, go into a Wal-Mart or Target and youll see incredible shelf space given to Tootsie products, similar to that of Hershey or Mars, both much bigger companies† (Hughlett, 2008). Management and Organization Tootsie Roll Industries started as a family run organization and has continued to try to remain in that type of an environment for their employees. They have combined a family-run corporate culture and a progressive management style. This type of style has been able to embrace an entrepreneurial spirit, setting the industry standard at delivering the highest quality product at the lowest possible price (How Tootsie Does It, paragraph 1). Community Involvement and Social Responsibility Being part of the community has long been a strong emphasis for the Tootsie Roll Industry. They have become involved with national concerns and have always been willing to help out with charities. Their products have been favorites among charitable fundraisers and have generated revenues that help sustain a variety of public and private causes. Conclusion Tootsie Roll has a long-standing reputation for being the oldest candy company in the United States. Tootsie Roll’s ability to keep up with candy trends has kept it in close competition with other companies such as Hershey Corporation, Mars, and Nestle. Reference Hughlett, M. (2008, May  4). Tootsie rolls along. Chicago Tribune. Retrieved from http://articles. chicagotribune. com/2008-05-04/business/0805030026_1_tootsie-roll-industries-wrigley-melvin-gordon Goldberg, M. , McDonnell, K. , Santhakumar, N. , Wood, J. , Marquardt, M. (2013). Tootsie Roll Report. Business Wise. Retrieved from http://business. library. wisc. edu/resources/kavajecz/10_Fall/Tootsie%20Roll_Report. pdf Kimmel, P. D. , Weiygandt, J. J. , Kieso, D. E. (2009). Accounting: Tools for Business Decision Making (3rd ed. ). Retrieved from https://portal. phoenix. edu/classroom/coursematerials/acc_561/20130312/OSIRIS:441986 33. Score. (2011). Business Plan Template Small Business. Retrieved from http://www. score. org/resources/business-plan-startup-pdf U. S. Small Business Administration. (2013). SBA Loan Application Checklist. Retrieved from http://www. sba. gov/sba-direct/article/2953 U. S. Small Business Administration. (2013). How to Prepare a Loan Application. Retrieved from http://www. sba. gov/content/business-loan-checklist# Tootsie Roll Industries. (2012). How Tootsie Does it. Retrieved from http://www. tootsie. com/comp_who. php