Costco “Nature”

Situational Analysis

Costco "Nature"promises to provide natural and organic foods that not only promote

health while implementing technology

Costco “Nature”is going to be the future daughter of Costco that will target the specific

group health oriented group that will be in a select few locations. We willManagement will be

easily filled but specific positions will need to be filled. CEO, Marketing specialist, buyers,

legal, nutritionist.

Costco “Nature” offers a safe and healthy alternative than the questionable products sold

at a regular grocer. With that being said, the prices tend to be higher than that of regular

supermarkets. Costco “Nature” promotes and markets to consumers in affluent communities of

dense population. Other than the promotion in local magazines or papers, the advertising tends

to be based in the local community near the store.

Costco “Nature” will not only have a wide selection of produce there will be open

kitchen/cafe where food and recipies will be prepared for customers using the ingrediences found

right in the kitchen/café. When a customer does go shoping it isnt just to get food. There will be

an artistic element to their shopping experience. Ipads will be set up at the end of hard isle that

illustrate items on sale. These Ipads will not only allow shopers to look up nutritional value of

selected products but recipie ideas that will assist the customer not waste the food they have just

shoped with.

Market Analysis

Consumers fuel the market growth for natural and organic foods but they “defy”

easy categorization. “Nearly all studies find that consumers with higher levels of education

were the most willing or most likely to purchase organic products (Dettmann and Dimitri,

2010; Zepeda and Li, 2007; Krystallis et al., 2006; O’Donovan and McCarthy, 2002; Cicia

et al., 2002; Fotopoulos and Krystallis, 2002; Magnusson et al., 2001).” Costco “Nature”

can lean on the trends of educated people buying more organically since an expotential rise

in Americans persueing the education. From 2001 to 2014 the increase in enrollment has

risen 32% and it is saafe to say that enrollment will continue to rise due to the demand of

specialized professions (U.S Department of Education).

“Organic products are now available in nearly 20,000 natural food stores and nearly

3 out of 4 conventional grocery stores. Organic sales account for over 4 percent of total U.S.

food sales, according to recent industry statistics” (Greene). Costco “Nature” has an

opportunity to jump into this market and feel fairly confident that their entrance will be met

with profit. “OTA reported in 2007 that organic foods accounted for roughly 2.8% of food

sales in 2006, reaching $16.7 billion and making up over 95% of all organic product sales”

(Hartman).

Hartman Group Research on Motives of Buyers (2000)

Nutrition Availability Taste Enviroment

Technology is also driving the market of food. When Googling “organic health”

you find over 408,000,000 search results on organic diets, reciepies, farmers, goods, and

basic health information about said products. Costco “Nature” will utilize this techonology

by having Ipads set up at the end of hard isles when nutritional facts will be provided,

various recipies, and even sources of the foods themselves. Since most organic and natural

food consumers are educated the use of these Ipads will be welcomed and utilized. The

tough screen technology will be simplified and the layout user friendly. Costco “Nature”

Will be jumping ahead of the trend that other food related businesses are slowly

incorporating. Fast food chain McDonalds in incorporating self serving cashiers that allow

patrons to cutomize a burger and give control of their health in their hands. By taking this

consept and putting it towards a grocer store the customers will be given information on

how to utilize their produce than just following one or two recipies that they have

memorized.

Direct Cometition

Whole Foods that offer FDA grade organic food and natural selection will be the largest

competitor. They have had a steady increase in revenue since 1999 to 2013 with only one hit in

the negative in 2009 during the financial crisis. Whole foods has a strong market growth and

stability. Their image of the brand is strong except that it is considered a "whole paycheck"

grocery store. Their target market are health concious individuals as well trendy young adults

that are now incharge of their health. Their biggist attribute would be location placement.

Ensuring that they are reaching their target market.

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Whole Foods Financial Report

Series 1

Inderect Competition

Local providers haveing agreements with competitors

Government regulations on what can be labled as all natural and organic indirect

competition is any grocer or food service place that sells similar food products.

Other supermarkets that may only offer a small quantity of natural foods compete for consumer

business, especially in today’s struggling economy. Many families might choose a less expensive

product from a more accessible store. Another indirect competitor would be fast food chains and

restaurants

Walmart is expanding their product line to more natural brands and locally grown

produce. Walmart has an expanded product line and are known for their low prices as well as

convienence. Their target is consumers that want natural produce but also need the convienence

of other options that are not soly health related. Their market strategy is advertising their

partnership with local producers. Though they try to enhance their focus on healthy foods but do

not focus all of their attention on it and their for it intregues health oriented people but they do

not have the level of commitment that we want.

Kroger has offered and will continue to offer produce at a renasble price. Kroger has a

small market to command but their image is with saving money on food by utilizing your kroger

card and earning points to save on gas. The problem is that not all krogers have gas stations.

Their image is related to cost efficiency with variety. The offer a section dedicated to specalty

brands. The membership does bring loyalty even if there is not a convienent gas station

available.

SWOT Analysis

Strength

Strong Brand Image

Quality product at low prices with constant change in products offered

Sucessful international expansion

Efficient productivity from employees due to decreased turnover by adding benifits

Outsourcing IT problems to save money

Buzz marketing saves money

Profitability due to volume not prices

Reduced distribution

Proven stability through economic and turmoil

Weakness

Bulk packaging leads to overconsumption with a higher footprint and pollution this goes

against the trending green marketing trends

By offering a higher wage to employees decreases revenue significantly in the long term

The lose of co-founder Jim Jinegal has created a whole in innovation and insight

Large space is required as well as a good location that can be difficult to come by as well

as expensive

Lack of advertisment

Limited service and no "frill" merchandising difers impulse buy

Opportunity

The ability to target a growing consumer base that are conserned with health and health

of their foods

The commitment to high quality natural, organic, and specialty foods

Quality vs. Quantity

Target clients by offering membership  that will garantee saving 2.5% on every fresh

produce

Large a wide variety from food to other green quality products

Utilaze empty building that add to the cuture of to the community while holding on to

their history and landmarks

Threats

The compitition in existing suypermarkets that are rebranding and specialty stores like

whole foods and specialty stores

Economic instability will create financial instability

Any changes in government regulations on organic foods would impact consumer

spending even further

The number of farmers and suppliers that are organic asnd natural foods

The risk of becoming a "whole paycheck" store

SWOT Summary

The challenges faced when entering a new market of consumers will be difficult but with

the strength of Costco's establishment and stability gives them an upper hand in targeting a

growing consumer based. The biggest hurtle is adapting to the USDA Organic Certification for

brands. Though Costco “Nature” does not have to go after the certification themselves they do

know and keep the supliers accountable for the products entering the store.

Issues to be Addressed

The key issues to be addressed are as follows:

Government regulations

Suppliers

Implementing Technology

Marketing to consumers

Implementing loyalty through loyalty program

Upfront costs

Identifying location based of demograph

Finding the right design and logo

Strategic positioning

Research objectives

The research objectives will need to focus on two aspects of potential customers. First

we need to identify the needs of consumers and out of their needs, identify those who will shop

at Costco “Nature”. The needs of the consumers will be analyzed and identified with the

motives behind their selection. The research team will analyze and interpret the key markers on

the consumers on the vast field of motives from the devoted consumers to the indifferent

“disbelievers.”

Customer Needs Who will shop at Costco “Nature”

Health concerns

Brand that they can trust

Eco friendly

The people that will shop at whole foods

The people that are health conscious and lazy

People that are uneducated

Technology driven information

Being able to grab a quick meal before,

during, and after shopping that demonstrate

recipes for foods that go bad quickly

Advice on what and how to eat foods and

recipes

Easy access to basic foods

Ease of access

People who are on the fence

People who are loyal

People who enjoy interactive service

People that need to see how the food should

be prepared

Upper middle class to upper class

Basic demographic markers

Research Methods

The research methods used will provide adequate information that will take raw concepts

and intuitions into measurable data. The qualitative data will require more interpretation and

analysis as well as cross reference the date with the quantitative questions. This will create a

clearer picture. To begin the qualitative data will need to be asked first.

The qualitative date will provide details about the inner acting’s and motives behind the

actions of consumers. The needs and the wants of the customers is more complex to the point

where even they cannot truly comprehend the vast grey of necessity and desire. Health concerns,

the desire to grab a quick meal, convenience in information, organization, the necessity to feel

mutual trust, the level of interest, etc. This information will illustrate the consumers that will

want to shop and what triggers they need to upsell the products.

The quantitative data will provide information that is more grounded in answers that are

well organized and numerical in nature. Costco “Nature” research team will identify the

characteristic markers that are typical with specific behaviors. With knowing these identifying

markers, Costco “Nature” will target these specific behaviors where they are densely populated.

The researchers will know the basic demographic information of each customer as well as their

interest/ devotion to the products and even their comfort levels with technology.

Secondary Data

Literature review and analysis will be provide a bulk of the answers required before

choosing and preforming the sampling method. There are a vast array of information about the

stores that have gone into the organic specialty stores as well as general grocery stores that have

added specialty products. Motivation of these consumers has been gathered and analyzed yearly

so the companies understand the opportunities and strengths with their plan as well as the

weaknesses with their targets.

A large source of information about consumers who purchase organic foods will come

from the Economic Research Service and the work with the United State Department of

Agriculture. Carolyn Dimitri and Lydia Oberholtzer analyze the rapid growth in demand of

organic foods. They broaden the range of consumers that purchase organic foods.

IRI and Spins create Spins NaturaLink Segmentation that generate new perspective on

consumer’s attitudes, use, and adoption of organic and natural products. They separate the

consumers into five categories that illustrate a larger picture of how the consumers can be

defined. SPINS NaturaLink segmentation is strapped seekers, healthy realists, indifferent

traditionalists, struggling switchers, and lastly resistant non-believers. The two organizations

broadened their survey respondents that way the information represents the total U.S. population

not just consumers that already use organic and natural products.

The University of California Cooperative Extension analyzed the motives towards foods.

Desmond Jolly illustrates the importance to consumers about residues, artificial color,

preservatives, and irradiation within the produce that they purchase. In addition the levels of

consumers concerns about nutritional risk factors. The information shows the level of concern in

relation to their actual purchase. The research also identified the demographic factors to the

buyers of organic produces versus non buyers. The psychographic motive are organized into

factors and compared to buyers versus non buyers (Jolly).

Sampling Method

Though there is a lot of previous research conducted, there will still need to be an

extensive sampling questionnaire so the information is up to date. Cluster sampling will be the

best for to extension of the research. What cluster sampling will do is take a population intro

groups and everyone within the chosen cluster will be sampled. This form of sampling will give

researchers a reasonable geographic are to perform the research. The dimensional sampling will

take into account several characteristics in comparison to the motives and habits.

Research Design

The primary instrument used to conduct the analysis will be through questionnaires and

surveys. Questionnaires and surveys are flexible in nature and fairly inexpensive. This method

does require extensive development and analysis. The secondary instrument that will be used by

Costco “Nature” is the qualitative method. This information will give a more in-depth

investigation of the complexity and sensitivity with consumer behaviors and analysis. Though

this method would require more analysis and interpretation than the traditional questionnaires

and surveys. The information from the qualitative method will create a three dimensional

illustration of consumer behavior that the questionnaires and surveys provide.

Research Budget

Costco “Nature” research team will request a budget of $180,000 to understate the study

described above. The majority of the expenses will from the personnel expenses for the essential

but time consuming activities and analyzing the information from the interviews. The

compensation will be for subcontractors that conduct interviews, a principle investigator will

lead the team with the help of a graduate student assistant. The principal investigator will be

responsible for the successful execution of the project. The subcontractors, principal

investigator, and graduate student will code and analyze the data generated from these interviews

and work on the publication that this information will generate. The total personal estimated

personal costs are estimated to be $140,000. The estimated direct expenses for the project are to

be $15,000. This includes the costs of interview transcription and supplies. The travel expenses

are estimated to be $10,000 which will enable the researchers to conduct direct interviews from

the appropriate domestic locations. The remaining $15,000 will be used in regards to the

incentives and rewards for customers participating in the research.

Budget Item Amount Subtotal

A Personnel

Sub-Contracted personnel to conduct interviews (6

people to conduct the inter per location with a budget

of $5,000 per week for 4 weeks)

$40,000

Course release for PI. For project administration/

coordination and data analysis for duration of the

20,000

project.

Website Designer to upload statistical data and

questionnaire

20,000

Graduate Student analysis support 20,000

Project Manger 40,000

Total Personnel Expenses $140,000

B Direct Expenses

Programed website and Domain 10,000

Transcribed survey and questionnaire 5,000

Total Personnel Expenses $15,000

C Travel

Domestic Travel (Transportation, accommodation,

meals) 4 domestic trips requiring travel 5 night stay

within each region with a 3 subcontractors. ($350

airfare x 3 persons) + ($700 lodging $750 Food and

Misc.) x 4 weeks

$10,000

Total Travel Expenses $10,000

Total Expenses $165,000

Overhead at 8.3% $15,000

Total Request $180,000

Marketing Objectives of the Business

Marketing objectives of Costco Nature business will cover market penetration,

development, diversification, and product and service development. Market penetration will be

the first priority of creating and executing the business. The key words with market penetration

is targeting the right consumers. Realizing market opportunities and meeting those needs in the

right location.

Moving Costco Nature into the organic store market is part of market development.

Creating leverage against competitors and creating a “link bait – share bait” to hook potential

consumers in. Product and service development will need to be refined. The Development of the

reward system will need to elaborated and defined to give the consumers incentives on making

Costco Nature their destination for grocery shopping. Technological development of the iPad

throughout Costco Nature will need to be programmed to meet specific the consumers’ needs

and wants. The content of the IPad optimize the consumer’s connection with shopping and

upsell in their products.

Diversification of the content of product while remaining within the parameters of Costco

Natures commitment to health and unique produce needs that still follow the trends. Costco

Nature marketing team will be proactive with merchandising and the brands that purchase.

Marketing alternatives

Costco Nature will rely on Niche marketing with their unique and superior product for

consumers. By making a direct connection with consumers by meeting their wants and needs.

Direct marketing will be utilized but will not underprice the products serviced. Costco Nature

will not try to satisfy all customers’ wants but focus on specific needs of diet and health and cater

through technology and reliable options. Direct marketing will take advantage in consumer

education, product quality, customer loyalty, and lifestyle while balancing the consumer/

producer loyalty.

Establishing business

Indirect marketing will focus on creating profiles on as many social networks and social

and social book marketing sites for Costco Nature. By utilizing links or information on the

profiles that can be seen by all potential users. The good content on the profiles will establish

the business as professional grocery. The more content on the sites will illustrate the

establishment as a technology driven company. Interaction through the social networks through

blogs, recipes, quizzes, and information that will draw attention to the profiles.

Marketing Strategy

The strategy of marketing to consumers through varies ways will establish the

development of Costco Nature into an established destination for grocery items. The following

are part of the strategy that Costco Nature will take:

Technological development of educational/upselling tools (iPad) for consumers to use at

easy through the design and programs.

Website development that offers company overview, goal, commitment, recipes, general

information, produce information, and rewards/coupons.

Penetrate social media to grow awareness of store, mission, services, and share recipes

daily.

Investing in local search engine optimization to gain visibility online at the local level.

Invest in online PR, article writing, blog marketing, establish local profiles, influence the

building process, video marketing, and image sharing.

Weekly e-letters and monthly letters to reinforce the presence of the grocery store.

Four square marketing implications to communicate to the right people through their

mobile application.

Utilizing the mobile application and website of Yelp that will assist consumers within a 5

mile radius.

In store strategy will rely on the 4 P’s of marketing product variety placement, pricing,

promotions, and programs.

The development of incentive programs through the rewards membership as well as

online and in store couponing.

Produce Sampling.

Establish marketing procedures to suppliers.

Target Markets

Costco Nature must follow trends of the niche consumers and adjust regularly but remain

loyal to the main focus group. Those that are more inclined to purchasing natural and organic

produce will have specific markers such as education, age, location, and act. Costco Nature will

focus on college educate locations where technology, science, research, development, and

innovations are the key focus of the city/suburban areas. The ideal location will be where the

general philosophy is on internal advancement not just as a whole but within the community.

Silicon Valley locations are ideal due to their collaboration of economic development of

professionals who bring public and private resources to establish business that promote the

valleys economy.

The Silicon Valley locations will be the optimal strategic place for development. The

demographic markers are diverse in America’s technological heartland. This will be the best

place to market, develop, and establish the first location. By locating Costco Nature in a Silicon

Valley location all basic markers of organic and nature foods consumers. Silicon Valley has a

large amount of younger, established, and educated consumers that are aware of their health and

the environmental impact of produce.

The educated niche market will need to have a reliable grocery store that provides them

with all certified organic and naturally made products that will be free of modern day chemical

enhancements of mass production.

The tech generations will benefit from Costco Natures innovation and incorporations of

technology through iPad and social media. This investment in programming that offers a fun

way and an artistic side to shopping will attract loyal customers. In addition the consumers that

have little time to get groceries and eat so Costco Nature will provide convenience in the deli

café. In addition to having the ability to gain a profit on produce that is about to expire, the

customers can experiences the featured recipes and watch the food being made.

Positioning Objectives

Competitive positioning on price in general will be based on the products and services

provided to the core market must still be at a reasonable price. The positioning the services and

products while remaining committed to the mission statement will attract loyalty. The healthy

natural and organic specialty foods while implementing technology will position Costco Nature

as a leading grocery store for all health needs. In addition, the company can have a key

community presence with educating the public on a healthy diet and be involved in their

community. With the artistic layout and design of the store and online will also separate Costco

Nature from other grocery stores by creating an experience.

Product Development and Selection

The produce and products that are featured in Costco Nature must have the government

approved GMO and FDA for being organic and natural. Produce suppliers will vary between

seasons but the preserved foods will be more reliable and easier to market. Brand names that are

recognizable to the target group will be key in establishing key clientele. Brands such as

Amy’s Kitchen, Bob’s Red mill, and Mary’s Free Range are just a few approved and established

brands that will be key suppliers for Costco Nature.

Implications

The first milestones are completing the marketing plan and web and iPad development

that the entire staff will collaborate on. The main focus on goals and development will keep the

main focus on the mission of Costco Nature. The Milestones pertaining to PR and direct

marketing will reflect the goals of expanding the awareness of Costco Nature and their

development in the community.

The marketing plan milestones will need a plan of attack with details on the milestones

needed. Within the first month the marketing team will design and print ads. The print ads will

give an artistic design that elaborates Costco Natures commitment to natural foods and organic

produce as well as the implication of technology. The brochures will have a similar design but

elaborate more on the rewards and membership incentives. The brochures will be divided into

10 segments that are identical in all aspects except the featured recipe.

Costco nature will also begin collaboration with various website listings that draw

attention to Costco Nature in their community. The Four Square and Yelp profiles will be

enhanced by paying for the executive design. Features and general information about Costco

Nature will be added to these sites as well as photos added regularly to create the right

personality of Costco Nature.

Costco Nature will complete the interior design of the store that captures the modernly

artistic nature of Costco Nature as well as key strategic places of IPad throughout the building.

The customers should be able to enter Costco Nature and feel the flow and Feng shui of the

building. The four P’s of merchandising will be implemented into the design in a tactful manner.

Costco Natures key milestone that will become a large incentive is the special schedules

and logistics of events and promotions will need to be elaborated. The details of schedules and

logistics of promotions will be clarified by the cooperation of ventures and partnership with

suppliers. In addition, the special offers for consumers will be surrounded by the schedules of

events and promotions. All details will be finalized so that the advertisement plans can go to

press in direct marketing.

Overall the advertisement budget is within the reason for the first grand opening of

Costco Nature in the fall. The following year’s advertisement budget will be modified and

simplified once the first year is over. Many of the key elements that go into the advertising plan

of the first year will not need to replicate such as the interior design and the lengthy involvement

in website listings. In addition, there will not be the repeated expense of the grand opening

event.

The PR plan will be detailed out and the focus will be in the grand opening picnic of

Costco Nature. The objectives and details of what goes into the grand opening will vary.

Marketing and business managers will need to convince the suppliers to invest in the company’s

first week on the prospect of repeated business and awareness expansion.

The direct marketing will be a key opportunity to bring in customers not only to try the

new grocery store but create loyalty. Direct mailers will be sent to the local community inviting

them to grand opening of Costco Nature as well create curiosity about the difference of Costco

nature and other grocers. Customers respond to incentives and mailers are an easy way to spread

the word to consumers quickly without additional man efforts. The Mailers will include a

significant amount of couponing as well as an offer to become a loyalty member. The additional

direct marketing effort will be in store. The marketing effort will focus on creating incentives on

becoming a Costco Nature member. These details will be played out and established for general

membership but an additional incentive will be in place for the first month’s signups.

The web development of Costco Nature will be a critical part of establishing the business.

The personal websites will not put the business on the map but also create awareness of the

Company. Their will need to be a detailed plan on what goes in on the website as well establish

assignments on reaching the goals. These assignments will need to have sight specifications that

will be subject to modification for improvement. There will be two phases for the development

of the websites. The first will cover the general lay out as well as specific features that will be

easily converted to all formats of viewing. The second phase will inserting the blogs, recipes,

information, and act. The last face will be the fine tuning and last minute refreshments of the

page before launching to the general public. This will need to be done two months in advance

before the Grand Opening.

The cherry on top of Costco Natures efforts towards establishing a technologically

advanced natural and organic grocery store is the IPad program. The plan for the IPad will need

to be specific to the needs and overall goal. This crucial piece that will set Costco Nature apart

from other competitors is going to be in the specifications of the applications programming.

There will be two major phases of development. The first phase is the basic design and

programing of the IPad that make them user friendly. The second phase of the IPad development

will consist of filling in the details information. This phase will create a story and personality

towards Costco Natures products as well as provide quick recipe options. This phase can be

assisted by partnering up with suppliers and having them provide various ways to use their

produce and products. The last phase will be the fine tuning and refreshments of the

applications.

Weekly and monthly trackers will be in place to ensure that Costco Natures implication

of marketing will be in place. The quarterly evaluations will allow adjustments in schedule as

well as make enhancements to ensure completion of scheduled grand opening. The focus of

quarterly reviews will ensure that there are not distractions against the opportunities of Costco

Nature.

The milestone chart below outlines the key dates that the marketing team must meet. The

milestone table includes both budget goals and deadlines for major projects that impact the

programs outlined in the Marketing Expense Budget. Each Milestone is assigned a manager and

that manager has ownership of the task and is responsible for its success. We will track the

successes and setbacks by reviewing the planned – vs – actual results. The successes and

setbacks will be reviewed and addressed on a weekly, monthly, and quarterly basis as to

establish a base line of progress and reasonable goals.

Mile StonesAdvertising Start Date End Date Budget Manager DepartmentMarketing Plan Completion 1/1/2015 2/1/2015 $ - Chelsea MarketingPrint Ad 1/1/2015 1/16/2015 $ 5,000.00 Chelsea MarketingBrochures 1/1/2015 1/15/2015 $ 5,000.00 Chelsea MarketingComplete Interior Décor 8/1/2015 9/1/2015 $ 2,000.00 Chelsea MarketingSpecial Offers 9/1/2015 9/15/2015 $ 500.00 Chelsea MarketingDevise Special Schedule and Logisstics 5/1/2015 6/1/2015 $ 9,000.00 Chelsea MarketingPrint and Distribute Grand opening mailers 9/1/2015 9/15/2015 $ 600.00 Chelsea MarketingWebsite listings 2/1/2015 2/15/2015 $ 500.00 Chelsea MarketingTotal Advertising Budget $ 22,600.00 PR Start Date End Date Budget Manager DepartmentPlan Established 11/1/2014 ### $ - Chelsea MarketingFirst Objective Review 12/1/2014 ### $ - Chelsea MarketingSecond Objective Review 12/2/2014 ### $ - Chelsea MarketingEvent: Grand Opening Picknic 10/1/2015 10/1/2015 $ 1,000.00 Chelsea MarketingTotal PR Budget $ 1,000.00 Direct Marketing Start Date End Date Budget Manager DepartmentNew Loyalty Incentives 10/1/2015 ### $ - Chelsea MarketingDirect Mail list couponing 9/1/2015 ### $ 500.00 Chelsea MarketingOther - - $ - Chelsea MarketingTotal Direct Marketing Budget $ 500.00 Web Development Start Date End Date Budget Manager DepartmentDetailed plan 2/1/2015 2/15/2015 $ - Chelsea MarketingSite Specifications 2/15/2015 4/1/2015 $ 1,000.00 Chelsea MarketingPhase 1 Devlopent 4/1/2015 5/15/2015 $ 3,000.00 Chelsea MarketingPhase 2 Development 5/15/2015 7/1/2015 $ 3,000.00 Chelsea MarketingFine tuning and refreshment 7/1/2015 8/1/2015 $ 1,000.00 Chelsea MarketingOther 2/1/2015 9/1/2015 $ 10,000.00 Chelsea MarketingTotal Web Development Budget $ 18,000.00 Other Start Date End Date Budget Manager DepartmentIpad Program plan 2/1/2015 2/15/2015 $ - Chelsea MarketingIpad Specifications 2/15/2015 4/1/2015 $ 1,000.00 Chelsea MarketingIpad Phase 1 Development 4/1/2015 5/15/2015 $ 3,000.00 Chelsea MarketingIpad Phase 2 Development 5/15/2015 7/1/2015 $ 3,000.00 Chelsea MarketingIpad Fine tuning and refreshment 7/1/2015 8/1/2015 $ 1,000.00 Chelsea MarketingIpad Misc. 2/1/2015 9/1/2015 $ 17,000.00 Chelsea MarketingTotal Other $ 25,000.00

Contingency Plan

Contingency planning is an important part of the marketing organization, as noted in the

previous topic.

The biggest potential problem in Costco Nature, is the limit in our abilities to create

programs in a financial manner. The budget has no guarantee of future sales figures that are

reliable and not enough research can be provided. In addition, the normal sales fluctuations of

weather, political, and most importantly economic difficulties can be forecasted. The plan is to

go in relying heavily on the right location that has the most potential for economic growth and

stability. Costco Nature is also attempting to follow a specific niche and marketing to the

consumers in a way they will respond the heaviest.

Costco Nature is subject to fluctuations in weather not just in the community but also the

fresh produce suppliers. Costco Nature will have to remain flexible and react quickly if they

need to switch suppliers on a short notice. This is unavoidable but Costco Nature can rely on the

mother company for support and connections.

Political influence can affect the business of Costco Nature. If a supplier is from a

foreign nation, not only the laws of the supplying nation and America will need to be honored

and obeyed. If there is any strife with the supplying country Costco Nature must be able to go to

another source for a similar product.

The last and the most influential effect on Costco Nature is the state of the economy.

Like any business, Costco Nature can be easily effected by a recession in the economy. Natural

and organic foods averagely cost more than the other super markets chemically enhanced foods.

Consumers can easily switch locations where they purchase groceries; Costco Nature needs to be

able to respond to this

Work cited

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Education Statistics, 2012 (NCES 2014-015),  Chapter 3.

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http://www.factsfiguresfuture.com/issues/june-2014/organics-let-the-good-times-

roll.html

Robots will replace fast-food workers. (n.d.). Retrieved January 5, 2015, from

http://money.cnn.com/2014/05/22/technology/innovation/fast-food-robot/

Natural Organic Program. (n.d.). Retrieved January 5, 2015, from

http://www.ams.usda.gov/AMSv1.0/NOPFAQsHowCertified

Organic Agriculture. (n.d.). Retrieved January 5, 2015, from

http://www.usda.gov/wps/portal/usda/usdahome?contentidonly=true&contentid=organic-

agriculture.html

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