Research Paper on:
Sorrell Ridge Case Study

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fruit. When approached by Sorrell Ridge with the aim of developing a strategy alliance Smucker said only that they were interested in taking over the niche market that Sorrell Ridge  had gained. If we look at the market in California there is the need for the introduction of a new boysenberry flavour as this is popular. This would be  in addition to the twenty flavours they already made. The sales of Sorrell Ridge were $5.4 million in 1986, and although sales have been growing there is increasing competition form  Smuckers and other such as Polaner. However the market share of the all fruit jams was expected to increase from the current 2 - 3% of the national market to  26% by 1992, meaning this was a growth segment. This is a 766 % increase 26 - 3 = 23, then 23/3% =766%. If Sorrell ridge can keep pace with  the that level of increase in sales then the income from Sorrel Ridge in 1992 would be 766% x $5.4 million = $42.36 million. This could be a very  lucrative market but there is also a danger in Californian where the pure fruit sales are falling and 80% of the market is controlled by only 6 retailer groups, so  breaking into these is essential. The decision of whether this is a market to enter will depend in the break even figure, but it would appear with the large  potential of growth in the national market and the current advantages that Sorrell Ridge may have being one of the established brands and also willing to ad a new flavour.  This means we need to look at the potential figures. Question 2 To calculate the break even cost the first consideration is the calculation of the break even costs.