Kitchen Made Pies Case Study
... Kitchen Made Pies (KMP) is a medium-sized, regional producer of bakery products (mainly pies), which is in a severe economic situation: Stagnating sales, four years of losses in a row and an equity deficit challenge the owner’s skills to turn the business around, thus preventing the company’s decline and eventual bankruptcy. ... KMP is not one of these large manufacturers but, it still has something in common with them: It produces a full-line of pies that means different sizes, numerous flavours, frozen and fresh pies, … Indeed, KMP’s emphasis on the products’ quality; Mr. ... Finally, a lack of a good management team within the company leads to poor strategies, which is the case in the production and promotional activities. ... The company produces high-top quality pies with superior looks that attract potential consumers. ... “Give up” – Another alternative that is not realistic in this case. ... In the short-term (that is the next 1-2 years) KMP should stop the (regular) production of the less profitable pies. As can be seen in Exhibit 22 the profit margin of 8-in and 9-in pies is significantly lower than the margin of 4-in pies. ... Therefore KMP must consider the 4-in pies as their niche, producing larger pies only on special orders in a sufficiently large quantity. ... In the long run – assuming KMP has made the turnaround – there is room again for growth in the niche of small pies.