This is to propose to recommend the aggressive relaunch of Lenor concentrate. This option can promote waste reduction benefits similar to those of a refill package; furthermore, it can make more profits than those of a refill package. As Rolf Kunisch mentioned, every new system or product may have risks or uncertainty when it appears as the first to market. In this case, there are a lot of risks for introducing the refill package and there is uncertainty of the final outcome for the refill package's future. That is why I recommend the relaunch of Lenor concentrate rather than a refill package even if the refill package also has a lot of advantages.
Followings are the main reasons for the recommendation of the Lenor Concentrate relaunch.
ÃÂ· One of the critical disadvantages of introducing the new package is that although the package might raise the firm's profile as an environmentally conscious corporate profile, it might also draw attention to other P&G products for which environmental and cost-effective improvements were not readily available.
It can cause negative reactions such as retailer resistance and government intervention.
ÃÂ· The decrease of market volume is due to environmental concerns highlighted by the news media. West German consumers are more concerned about the environmental effects of using supplementary household products such as fabric softener than consumers in other West European countries. On the interview, 48% of nonusers never used/stopped using fabric softener for the environmental reasons.
ÃÂ· Because they focused increasingly on the direct product profitability of their stock per linear foot of shelf space, retailers were especially keen on high-margin, space-efficient products with rapid turnover. So they are more interested in Lenor Concentrate making more profits.
ÃÂ· There were not many competitors in the West German fabric softener market in 1987, and Lenor led the market with a 37% of market share.
ÃÂ· Even though there is uncertainty of the final outcome for the refill package's future, the Start-Up cost is high.
ÃÂ· The profit and total contribution are the highest among the four options.