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Case Analysis

By: Ayush Goyal(2011MB0001) Prachee Parwanee(2011MB0003) Madhurendra Kumar(2011MB0005) Lopa

Two university graduates have an idea of

bean bag business. Vision to make high quality bean bag chair. Want to make it available to students at comparatively cheaper prices. For the same trying to make a marketing plan.

Key facts
Bean bag are flexible, easy to move and comfortable. Targeted customer i.e. students can be

categorised into two groups: freshmen and upperclassmen. 70% of students live in on campus residences and a small bean bag chair may not be an attractive options for them The popular perception for bean bag is that it is sloppy, poorly made and not attractive.

The material and design is the key factor for

the product to be a success.

There are three possible ways of making

the product available to the students:

Selling to local stores Selling to campus outlets. Selling directly to students.

Competition is quite minimal.

Due to high fixed cost they have decided to sell the chairs unstuffed.
They want to make money devoting minimal

time. They have decided to produce to order than stocking. Promotion is critical for this business. There are opportunities to sell the product to other university students.

Case problem
Lee and Michael want to design a furniture product for university students i.e. bean bag chairs which is attractive, durable and of high quality which can break the so called perception that bean bag chairs are sloppy, poorly made and not attractive and make it available at fairly cheaper price so that it can be affordable for students.

Target Customer
staying at on campus residents. have to be convinced that beanbag can be a good

furniture alternative.

Upperclassmen (residents and non-residents)

have allocated budget for furniture. they need to be convinced on price, quality, and

durability of the product.

Design Ball shaped: Advantages: Easy to make, least cost, disadvantages: not stylish, not flexible, one sitting position Pear shape: Advantages: sophisticated, comfortable and three ways of sitting Disadvantages: more waste material, difficult to make L-shape: Advantages: small, takes less space Disadvantages: difficult to sew and one sitting position

Rolled: lower quality, minimize waste in production Skin: high quality, durable but expensive.

Vinyl: variety of texture and colour, easy to clean

and durable. Fabric (velour\cotton\canvas): limitless choice of colour and pattern, not easily cleaned.

Selling to local furniture stores. Selling to campus outlet Selling directly to students

Orientation for freshmen Word of mouth Advertisement

Suggested solution:

Raw material: Vinyl should be used. Design: pear shaped Distribution: directly to students Promotion through orientation, word of mouth, radio advertisement(ciqm103.1 fm, evening sat /sun for 30 sec) So total product cost: 94 Mark up: 100% Selling price: $188+ $8( freight charges)=$196 Competitor( toronto): $245-$299



sophisticated, comfortable three ways of sitting

Easy to clean Variety of texture and colour Cost efficient Weakness: No brand image Less time Opportunity: Threats: Toronto Other furnitures Student lounge Corporate capabilities: refer page5

Growth opportunity
Possibilities for other

universities exits We choose the universities located along 401 Excluding toronto and york university.

Galph University Waterloo University UOW Wilfren University

Number of fresh students

9802 14397 15422 4405

Windso University