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w much).. There is little excess capacity anywhere in the industry today. . ? Has your client’s relationship with its retailers suffered as a result of it not supplying private label products? Not noticeably ? Are grocery stores using private labels in other food categories? Yes, there has been a major push by grocery stores to populate shelves with private labels ? Is petition increasing or decreasing among grocers? Generally increasing. Grocer chains are expanding and the number of grocers to be found serving a given area has generally increased over the past five years ? What general macroeconomic trends have occurred over the past five years? The economy has been slowing over the past five years. There is concern about recession The above information begins to expose a clearer story. A number of factors have contributed to the emergence of the private label segment: manufacturer’s interest in utilizing excess capacity, grocer’s desire to sell products with their name on it (they may believe this creates return customers in an increasing petitive environment), consumers concerns about a troubled economy (price vs. quality tradeoffs). At this point the candidate would be encouraged to state what they believe the magniturde of the private label threat to be to the client. There is no right answer. One can argue either way. If the threat is seen as high, the likely remendation is for your client to begin supplying private label products. The candidate should recognize that in peting in the private label segment, the basis of petition is primarily cost. At the same time, the client’s branded product should be protected. The following tactics might prove appropriate: ? Seek to wring costs out of all phases of the operation ? Utilize all existing excess capacity ? Gain maximum product knowledge as quickly as possible ? Understand low cost positions on product ingredients and mix ? Review process improvement/ manufacturing efficiency opportunities ? Undertake overhead reduction efforts (Any of these points could be discussed in