Business Strategy Case Study: Limp-O-O-Lixo Case

Contents

Executive Summary 2

Statement of the Problem 2

Causes of the problem 3

Decision criteria and alternative solution: 8

Recommendations 9

Executive Summary

Brazil has a population of 170 million and has been observed to have a growing economic cycle since 1990 's which has led to increasing purchasing power and consumption among people. Ad-Lider Emblagens, SA is one of the largest manufacturers of plastic bags and packaging in Brazil. The problem that has been under the light of this case is that the company’s current product “Limp-o-Lixo" isn 't able to fulfill the needs of customer despite having a huge market share of 38.79%. In order for the company to revive its current market position and to meet the changing demands of the

Classes A and B are the educated and wealthy ones and has a major portion of national consumption. Lower Middle class constitutes class C. Class D and E had very low purchasing power.

Qualitative research was conducted in the two cities of Brazil; Sao Paulo and Rio de Janeiro. The method used for qualitative research was a focus group. In San Paulo, there were two groups, one of the apartment wives and the other of housewives. In Rio only, apartment wives group was formed. All the group belonged to Class A&B and was involved in purchasing of garbage bags.

In order for Ad Lier to collect information for the launch of its new product “Fecha Facil” qualitative research was conducted in two cities of Brazil; Rio de Janerio and Sao Palo. The technique used for research was focus groups. In Sao Palo two different kind of clusters were formed, one of the apartment wives and the other of housewives, however in Rio de Janeiro, one single cluster of apartment wives was formed. All the individuals in cluster belonged to Class A and B and were a user of garbage

New Garbage bag features Product should have an opaque coloring, should be able to hold heavy products and has a closing system The product is bought

New garbage bag closing system (drawstring) All the groups accepted this feature of the product Product with different functionality is available.

New garbage bag packaging (Box or Plastic) San Paulo and Rio Box packaging was seen a more convenient in San Paulo, and plastic was more favored in Rio -

Colour of the new bag The resilience of the bag was judged on the basis of darker colors hence a green color was decided. Bags with darker shades were purchased.

Capacity of the new bag All the groups firmly agreed on having a 50L capacity bag -

Usage of bags apart from garbage As a storage or holder of books, clothes, etc. Different usage Following are the key findings;

• In households, women make the purchasing decision.

• In Sao Palo no specific pattern can be observed.

• Price is a key factor in making the purchase decision. Strength and capacity come after price.

• The darker shade is associated with the strength of the