Apple Orchard

C: Firstly, I would like to analyze whether the problem is arising due to the supply side (production & distribution) or the demand side, if you could shed some light on that.

I: So, we have 30 acres of land having fixed number of trees implying constant supply of apples from the trees all throughout the year. Then, we provide these apples to our 2 sole distributors, with whom we have had long term relationships with, who then provide to retailers.

C: Okay. So next it seems that supply isn’t an issue, but demand is. As it is an industry wide phenomenon, would it be safe to say that our price isn’t the issue but rather volumes is, since if price was the issue, we would have been the only firm impacted and would have corrected it within 2 years?

I: Yes, that is a fair point. Our volumes have seen a decline.

C: Is there any particular distributor or retailer who has seen a decline?

I: Both distributors have seen a decline. Though according to you, what constitutes the demand for apples?

C: So, I would like to distribute the demand into 3 headers- residential, commercial & industrial. The reason why I have taken commercial and industrial as 2 different headers is cause in the former, I wish to take industries where apples are used directly- say in the hospitality industry, while in

commercial the apples are processed first and then used- say in making processed foods/beverages. So, is there any particular head which has seen a decline?

I: The beverage industry buyers have seen a major decline, while the remaining demand channels have remained constant.

C: okay so to further analyze this channel, I would look at 4 aspects:

Product- have the apple beverages seen a fall in demand?

Price- has the price for such beverages risen sharply in the past?

Place- have the retailers changed the distribution channels of the drink?

Promotion- has the messaging of the product changed over years?

I: So off lately, people have started to believe that apple juices have alcohol and have hence seen a decline in sales. You seem to have arrived at the problem, what are your recommendations?

C: In the short term, the client can go for expanding the business in the commercial and residential sectors and try to compensate for the loss in industrial demand. In the long run, he can try to diversify into other products by building the necessary technical and functional expertise.