A long-established market leader in a number of food categories let a new compact packing design opportunity slip through its fingers. A new entrant in the food business had adopted this packaging and along with savvy promotional campaigns soon held more than 65% market share, surprising the four incumbent market leaders. The question for the client was about the new entrant’s ability to sustain its market share and growth. Did it have the financial wherewithal as well as manufacturing and distribution smarts to hold its own? Our work concluded “yes” on every question.

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The Little CPG
Company That Could
Shake Up the Market
CASE STUDY

2. THE LITTLE CPG COMPANY THAT COULD SHAKE UP THE MARKET WWW.FULD.COM
A Surprise Shakeup
Case Overview
A long-established market leader in
a number of food categories let a
new compact packing design
opportunity slip through its fingers.
A new entrant in the food business
had adopted this packaging and
along with savvy promotional
campaigns soon held more than
65% market share, surprising the
four incumbent market leaders.
The question for the client was
about the new entrant’s ability to
sustain its market share and growth.
Did it have the financial wherewithal
as well as manufacturing and
distribution smarts to hold its own?
Our work concluded “yes” on every
question.

3. THE LITTLE CPG COMPANY THAT COULD SHAKE UP THE MARKET WWW.FULD.COM
A Visitor from Another Planet
Key Business Challenges
This new entrant launched its business a half-dozen years ago, generally
staying under the radar the first few years, largely ignored by the major
producers. Privately funded, and originating in Latin America, it slowly but
surely gained shelf space. By the time the client asked for this analysis, this
new entrant had won major supermarket chain store accounts throughout
the US with a likelihood for more wins in the coming year.

4. THE LITTLE CPG COMPANY THAT COULD SHAKE UP THE MARKET WWW.FULD.COM
The Margin Challenge
Key Business Challenges
As Clayton Christensen states in his
book, The Innovator’s Dilemma, large
established companies generally do not
enter new markets if the revenue
potential does not meet expectations.
By the time our client realized how far
this new foreign company had come, it
had already achieved economies of
scale enabling further growth. The
client needed to examine this new rival
and consider the likelihood it could
achieve the same or similar sales
volume even this late in the game.
Upon reflection, the client also asked
the same question of its more
established rivals.

5. THE LITTLE CPG COMPANY THAT COULD SHAKE UP THE MARKET WWW.FULD.COM
The Solution Was Right Under the Client’s Nose
The Fuld Approach
Co-packers were a critical piece of the
puzzle for this segment of the market.
These co-packers served both large
producers looking for additional capacity as
well as smaller companies that could not
make the investment in capital equipment.
Startups, such as this Latin American firm,
experimenting with new designs and
package sizes approached one of these
leading co-packers, according to the report’s
research findings.
The analysis provide a detailed assessment
of five specific co-packers, including one the
client had often used in the past. Based on
the report’s recommendations, the client
struck a deal with one of the co-packers to
aggressively produce a directly competitive
product.

6. THE LITTLE CPG COMPANY THAT COULD SHAKE UP THE MARKET WWW.FULD.COM
Insight on Risk and a Motivation
to Move Forward…Fast
Key Business Impact
During the assignment the client learned that the rival would plan to launch an IPO
in the United States sometime over the next several years and would likely be
aiming for near-term profitability rather than longer term revenue growth by
continuing to develop new products. The client now had a window of opportunity
over the coming year. With the client’s vast distribution reach and sales force, as
well as its capital investment capabilities, it was able to move up to strong second
place in this market with plans to possibly usurp the rival’s position in the next two
years.
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7. THE LITTLE CPG COMPANY THAT COULD SHAKE UP THE MARKET WWW.FULD.COM
A Second Look at the Rivals is Critical
The Fuld Review
Markets do not stay the same for long.
The client realized that its established
competitors may all be considering the
same moves and that the new rival will
attempt win additional large accounts.
If the client or its rivals could not
achieve healthy margins, trying to
catch up to the market leader could
become a fool’s errand. It therefore
was very important that the client
benchmark the other four companies
in this race and determine their likely
margins. If it could determine which
rivals may have weaker profitability, the
client could better focus its marketing
and investment plans to leapfrog the
current category leader.

8. THE LITTLE CPG COMPANY THAT COULD SHAKE UP THE MARKET WWW.FULD.COM
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9. THE LITTLE CPG COMPANY THAT COULD SHAKE UP THE MARKET WWW.FULD.COM
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