Case Studies

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Start Up Snack Food Manufacturer

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Situation

A young, rapidly expanding snack food company, specializing in bagged granola-like products, faced significant operational challenges three years into its operations. Despite experiencing swift market growth, the firm struggled to maintain positive cash flow due to manufacturing and packaging costs that significantly exceeded industry benchmarks. Additionally, the need for new market development to sustain growth trajectory, coupled with management's limited understanding of the true costs associated with manufacturing and distribution processes, further complicated the situation. These issues collectively hindered the company's ability to capitalize on its initial market success and threatened its long-term viability in the competitive snack food industry.

Our Approach

MCAworks implemented a comprehensive strategy focusing on demand generation and cost containment. The demand creation initiative centered on a corporate gifting program, leveraging targeted lead generation and follow-up processes. This approach emphasized personal communications with executive assistants, utilizing cost-effective student labor to maximize outreach efficiency. Concurrently, the cost-containment program comprised three key components: First, a detailed analysis of the company's P&L, including five-year projections, was conducted and reviewed with ownership to identify strategic leverage points. Second, having pinpointed high packaging costs as a critical issue, MCAworks facilitated introductions to industry leaders, who provided guidance on more cost-effective packaging solutions. Finally, to address overall manufacturing costs, MCAworks conducted extensive research to identify, source, and qualify potential food co-packers, arranging strategic meetings between these entities and company management to explore optimization opportunities.

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Results

The implemented strategies resulted in immediate cost reductions and the successful development of a previously untapped target market. These achievements provided the start-up with crucial breathing room, allowing for a thorough exploration of additional avenues to establish a sustainable, long-term business model.