文档内容
Mandyle
Objective
Mandyle Chocolate is one of the most famous premium fine chocolate manufacturers
and chain stores in the world. As a consultant in a leading consulting company, you
need to work with your team to develop a strategic plan for how to expand in the
Chinese market.
Background
院
Founded in 1956, Mandyle owns 10,000 specialty retailers across the world. In addition
学
to chocolates, Mandyle also sells truffles, coffee, cocoa, biscuits, dipped fruits and
sweets, chocolate liqueur, shakes, wedding and party favors and other items arranged
in gift baskets. Since Mandyle entered the Chine
计
se market in 2010, they have developed
103 stores, with an average annual increase of nearly 20 stores in China. Mandyle
would like to increase its market share and profitability over the next five years. At
会
present their total market share in the Chinese market is 12% and is much less than
expected. In the first-tier cities they have a market share of 17%, which decreased
sharply when a competitor came计 into the Chinese market. In second-tier cities, it has a
market share of 5%. They were dominated by common chocolate brands. With the
promotion of brand awareness in some second-tier cities, such as Ningbo and Suzhou,
审
the average sales growth in second-tier cities surpassed the first-tier cities for the first
time in March.
：
The following table shows the annual revenue, gross profit, total operating expenses of
Mandyle China among 2011 and 2016.
b
t
(Millions of USD) 2016 2015 2014 2013 2012 2011
Revenue/收入 339.9 256 174 94.6 63 34
Cost of sales/成本 221 154 87 32 26 17
Gross of Profit/毛利 118.9 102 86.6 62.6 37 17
Total Operating 124 107 91 66 40 18
Expenses/总运营费用
Total Operating Profit/ （5.1） （5） （4.4） （3.4） （3） （1）
总运营利润
With the increase of new stores, operating expenses have increased and the following
is the information about the Operating Expenses.Five expense in Operating Expense in 2016 Percentage
Transportation Expense 31%
Recruiting Expense 23%
Research & Explore new catalogue 21%
Marketing Expense 18%
Admin Expense 9%
院
学
计
会
计
审
To deliver the ultimate chocolate experience and respect heritage, Mandyle do not have
a chocolate factory in China. All chocolates are shipped in refrigerated trucks from
：
abroad. Because of strict requirements Tor transportation and preservation, they have
to use professional shipping companies at very competitive costs. Transportation
expenses tend to fluctuate very little with an increasing number of stores. For stores in
b
the same regions, the more the new stores operate, the lower the average transportation
t
cost. Mandyle is hiring more senior people in different functions, so the salaries of
management are much higher than the industry average. The stores are located in
central business districts in all selected cities and the rental cost is relatively high.
Mandyle have chosen to develop corporate-owned chains since they entered the
Chinese market. This means Mandyle runs the day-to-day operations and owns the
profits and losses of each store. There is another choice for expanding, which is
franchising(特许经营店). Each franchised store must follow certain guidelines set up
by the parent company, which include the types of products that can be sold, operating
procedures and the prices they can charge. In exchange for the time-tested business plan,
marketing power and brand name, the franchisor takes a cut of profits. For reference,
the following are some popular modes for franchising, with conditions and profit
distribution varying according to different companies.Conditions of various Modes Profit Supplement
Distribution
The franchisor manages the Parent company Besides the operating
investment and all operating takes a proportion revenue, the parent
expenses except transportation. from the sale of company subsidizes the
Unified pricing and distribution, products profits(补贴) according
and sale of parent company to performance of
products only. franchisor
The parent company invests and Take a proportion
takes a stake in the business, of the profits of
independent pricing by stores and the operation
they take ownership of goods close
院
to the store. They’re also allowed
to sell other products other than
学
competitors’ goods and they can
arrange their own branding.
计
Mandyle did not choose to expand via franchised units at the start of its entry into the
会
Chinese market; instead, they began with company-owned units. This was because they
were worried about the poo infrastructure and the inadequate legal framework for
preventing the sale of fake prod计ucts via unapproved outlets. In their future expansion
plans, the management is open to proposed solutions for corporate or franchise
options. The following are the locations which Mandyle has chosen for its expansion
审
of chain stores in China.
Already Ope：ned stores No. of stores Types of cities
Shanghai 28 First-tier city
Hangzhou 16 Second-tier plus(二线发达城市)
b
Ningbo 9 Second-tier city(二线中等城市)
t
Wuxi 5 Second-tier city
Suzhou 11 Second-tier city
Nanjing 14 Second-tier plus
Beijing 13 First-tier city
Tianjin 7 First-tier city
All retailers are in the process of change. There are two business strategies which are
useful as reference:
Lifestyle strategy: An American coffee company and coffeehouse chain, Starbucks,
markets its products or services in a way that embodies the interests, attitudes and
opinions of a group or a culture. They sell not only coffee but all products relevant to
that lifestyle. For example: they sell cups, snacks, alcohol, CD's, handbags, digital news
etc. Last year. Starbucks launched their "new food" program in 12 provinces and citiesin China, introducing 38 new food items. with prices ranging from 15-32 Yuan for the
new meals. They found that adding new categories and adjusting their business model
and format, plus retailing mixed lifestyle foods and beverages can improve store sales
and profits, but will also increase the operating expenses.
E-Commerce strategy: Some retailers have closed their stores and developed an e-
Commerce business. For example, a fashion retailer is exploring strategic alternatives
for its besieged business and plans to close all 170 of its stores and focus solely on its
e-Commerce operations going forward. Luxury brand Kenneth Cole is the most recent
example of this online shift, saying in November 2016 that it would close all 63 of its
stores to concentrate on its e-Commerce site and wholesale business.
院
Tasks
学
You are to participate in an 80 minutes activity. Mandyle are planning to increase its
market share and profitability. You are required to work with your team to develop a
strategic plan for the Chinese market By the end of your discussion time, you need to
计
achieve team consensus on your strategy for presentation and:
• Present your strategic plan about how to expand in the Chinese market, what
会
challenges the company will encounter in implementing your plan and how you would
handle them. It is suggested that you consider the following aspects (including but not
limited to): The business mode, 计the expansion strategy (franchising or company-owned
chain), location selected, prioritizing the choice of cities.
• Highlight how to increase a share and profitability. Be specific with your suggestions.
审
Timing Activity Output
10min Mate：rial Reading
40min Case analysis and Work as a team to develop a proposal with
the corresponding actions.
dbiscussion（CN）
t
20min Everyone should participate in presenting
Presentation（EN）
your proposal in English.
10min Assessor debriefing
80min in total
