Grove Fresh Ltd - Marketing Organic Juices

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Case Details:

Case Code : MKTG128
Case Length : 09 Pages
Period : 1994-2006
Organization : Grove Fresh Ltd
Pub Date : 2006
Teaching Note :Not Available
Countries : United Kingdom
Industry : Organic Foods (Fruit Juices)

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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Background Contd...

In 1998, GFL acquired the Germany-based FSP Frische and its French subsidiary Fraicheur for a sum of £ 1.3 million.

With this acquisition, the company entered the European non-organic fruit juice market as well.

The company further strengthened its position in the non-organic fruit juice market by acquiring Fruity King, a Dutch company, in 2000.

Subsequently, Taylor retired but he continued to own United Foods International (UFI), the holding company of GFL, Frische and Fruity King, through a trust registered in the Isle of Man.

The acquisitions, together with increasing sales and profits due to a marked increase in the demand for organic products in the UK, pushed UFI to the 3rd rank in the 2001 Fast Track 100, a ranking of British businesses with the highest sales growth. The company had achieved a sales growth of 185% with total sales reaching £ 18 million in 2000. In the 2000s, GFL's sales continued their healthy growth (Refer Exhibit I for sales turnover of GFL).

However, by then, organic juices constituted only 10 percent of UFI's sales. This was because with its acquisitions in continental Europe, the company's sales of non-organic juices were growing. The growth in demand for organic juices in continental Europe (especially Germany and France) was not as high as in the UK.

Marketing Grove Fresh

GFL marketed its organic juices under the Grove Fresh brand. The company targeted middle-aged people, especially those who came under the 'empty nesters' group. At the same time, the company found that the youth, especially those who were health-conscious, were taking to organic juices in a big way, too.

Andrew Shupick (Shupick), Managing Director, GFL, said, "The key consumer group for organic juice is the over-35s whose children have left home and who are indulging themselves with the best quality food and drink available, now that they have more disposable income. However we are seeing a growing number of younger consumers becoming regular purchasers of organic juices."⁶ By 2006, the company had come a long way from its beginnings in 1996, when the UK was experiencing a surge in the demand for organic juices. Demand for organic juices had stabilized and GFL had to operate in this very different market where phenomenal growth no longer seemed likely.

Excerpts >>

6] "Juice steals share from traditional breakfast beverage," www.nexnet.co.uk, March 1, 2006.


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