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REDEFINING AGRICULTURAL INPUT SUPPLY

Explore the dynamic marketing plan by Ram Marketing Consultants to revolutionize agricultural input supply. Analyzing market opportunities and threats, SWOT analysis, financial projections, and key planning assumptions are key highlights.

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REDEFINING AGRICULTURAL INPUT SUPPLY

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  1. REDEFINING AGRICULTURAL INPUT SUPPLY Supply Chain Management Tools/E-commerce Presence Online Auction Chemicals, Fertilizer, Seed, Machine Parts, Animal Health

  2. MARKETING PLANfor Ram Marketing Consultants Colorado State University Megan Bruch, Alejandra Engler-Palma, and Jay Parsons August 2001

  3. PROBLEM STATEMENT How do we market ? Revolutionizing Agricultural Input Supply

  4. KEY ALTERNATIVES • Focus on XSAg.com • Brokerage services • Focus on Nterline Network • Supply Chain Management tools • Focus on a fully integrated supply management system • Closely link the two platforms

  5. XSAg.com Agricultural retailers Inventory management Agricultural producers Sales of $100,000 to $500,000 Nterline Agricultural retailers, distributors, and suppliers trading highly regulated products Retail stores with greater than $3 million in annual sales MARKET IDENTIFICATION

  6. XS,Inc. Strengths Weaknesses Market Opportunities Threats SWOT ANALYSIS

  7. STRENGTHS • Strong, growing, and satisfied customer base • >60,000 registered users • 95% user satisfaction • Partnerships/Alliances

  8. Alliances • Investment: • Banking and Credit: • Media/Content: • Commodity Trade: • Product Data: Logistics: • Web Hosting: • Technical: • Privacy: Security: • International:

  9. WEAKNESSES • Lack of service to producer • Supply chain friction

  10. EXTERNALTHREATS • Significant competition • Speed of adoption

  11. OPPORTUNITIES • Large growth in online agricultural sales forecasted • By 2004, 15% of transactions online (Forrester Research) http://www.businessweek.com/2000/00_20/b3681102.htm

  12. OPPORTUNITIES • Slim farm margins • Future input technology • Supply chain management • ~ $500 million in excess crop protection inventory each year • (http://www.wpc-edi.com/insider/Articles/\/2/11-3m.htm) • SCM systems shown to reduce inventory costs 30-50% • (http://www.oracle.com/corporate/press/index.html?606088.html)

  13. DECISION Market a fully integrated supply chain management system closely linking the two platforms, XSAg.com and Nterline.

  14. PRODUCTPOSITIONING Supply Chain Management & e-commerce Chemicals, Fertilizer, Seed, Machine Parts, Animal Health Online Auction Revenue & Customer Relations Management

  15. Transaction Fees Nterline Service Storefront packages Subscription charges Maintenance fees Advertising PRICING

  16. PROMOTION • Service Alliances • Agricultural Retailers Association • Vantagepoint Network • Cross Promotion

  17. KEY PLANNING ASSUMPTIONS • 2004 • 1. Stable producer expenditures • $50 billion annually • 2. Market concentration • 75% among three competitors • 3. Online sales growth • 12% of total sales

  18. FINANCIAL ANALYSIS Transaction Fee Revenue $50 billion (market size) x 0.12 (online sales ratio) $ 6 billion (industry online sales) x 0.35 (XS,Inc. market share) $ 2.1 billion (XS,Inc. sales) x 0.02 (avg. transaction fee) $42 million (XS, Inc. revenue) x 0.3 (returns from operations) $12.6 million operating margin

  19. MONITORING AND MEASUREMENT • Transaction volumes and subscriptions • Forecast accuracy • Conduct random customer surveys

  20. Supply Chain Management & e-commerce Chemicals, Fertilizer, Seed, Machine Parts, Animal Health Online Auction Revenue & Customer Relations Management

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