Kameda Seika: Cracking the US Marketing Case Solution
Kameda seika was started in 1946 by Mr. Eiji Koizumi in Kameda niigata. The objective behind this company was to eliminate the food scarcity among people after the war. It was first named Koizumi, the name was a bit difficult and the first product of mizuame thick malt syrup of rice was failed and then, the owners shifted their focus from malt syrups to rice crackers. The rice crackers became a successful launch for the company as they received a very positive response from the customers. The company was renamed Kameda Seika. The company was started with the vision of becoming an international seller and popularity all around the world. Additionally, the objective was to be known as the most trustworthy brand because in Japan’s culture they wanted to represent their country’s culture. Kameda was well-known for the manufacturing of rice crackers and possesses a major share of 39% in the market.
The company was started in Japan but slowly and gradually it started to expand in the market and achieve the objective of global recognition. It started to go for the international market through collaborations, initially. The objective of the company was to achieve the 30% sales target from the international business by the year-end of 2020. Managers were very much interested to recover the market of the USA and increase the sales ratio in the USA market. Though the company hasa clear idea that the market demand in the USA for rice crackers is ten times smaller than in Japan. But still,the company wants to keep that market and intended to fulfill the objectives. The US rice cracker market in the U.S tends to be 10 times lower than in Japan than expected to increase by 20 percent. Furthermore, the firm went public in 1984 and was listed on both the Niigata Stock market and the Tokyo Stock market as well.
A firmoperated by Kameda in the U.S. called Kameda USA Integration has been working since 2008 with assessed financing of US $ 9 M in sales and advertising. The recent sale of US $ 2.25 M would not be possible for expansion and would not be enough to cover all the costs of the firm. Similarly, this may be due to an increase in the number of older people and a decrease in the sweet market of Japan expects the expansion. Therefore, without changes to the item packaging such as packaging, a new taste, vendor’s fees, there was no rise in product sales for a firm that had a few years and restricted-financing to raise their sales and create enough income.
Kameda expandsits business in the USA but the current situation in the US market was not favorable. The demand of the customers was decreasing and people were becoming more health-conscious. The gluten-free trend was dwelling in the country. And the management wanted to make these conditions favorable rather than exiting the market. But there were few Japanese companies in the USA which achieved success in the market i.e. calbee, Ito En, and teas. Though Kameda was trying to make it work in the USA.; the current merger of Kameda was doing well and but the profit margins were low due to the high price of production along with that the distribution coverage of the company was also limited. There was time and budget constrain for the company because they only have 3 years to plan and implement an effective plan to generate more profits to keep going in the US market, otherwise, they have to wrap up the company. Though the company had few options and the management was working on these options i.e. the packaging, marketing, retail chain, private labeling, and investments in the plants…………………
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