Reliance Baking Soda: Optimizing Promotional Spending

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It is worthy to note that the pricing at the retail level was actually lower than the suggested one. The company had also experienced an increase in the cost of raw materials, thereby raising the manufacturing costs (Quelch & Beckham, 2009). It is wise to adopt long-term financial plans that would still ensure the company’s competitiveness even if the prices of raw materials soared. In this case, despite the increase in the manufacturer’s price, the retail price was low maybe due to the existence of private brands.

In the advertisements, more advantages should be stressed in addition to the non –toxic effect of the product. Its major competitors are also producing nontoxic products and to keep the product in the minds of the consumers, reducing costs and adopting online advertisements method would help. Door to door promotion may not be possible, but wherever individuals even in market stores can run applicable advertisements would be beneficial.

RBS should also focus on more profitable commodities. The company can also produce other baked ash products to increase their overall income. Harnessing innovation would form part of coming up with profitable commodities. This innovation should be based on strategies that would address customer needs and also add value to the existing products. The company should also seek to develop relationship with other organizations like those that design washrooms and kitchens. These companies can recommend to their clients the best items to use like baking soda in which they would refer to RBS Company.

Implementation of the “Best” Solution

The best solution would be implementing a long-term financial plan that would shield it from the uncertainties in the raw materials market. These include the unexpected surge in the cost of raw materials like soda ash, which in turn lead to increased manufacturing costs. Long-term plans would include having a fund that is set aside to help the company course through such economic hurdles. Other companies that do not use baked ash, as a raw material would still continue producing substitutes for the product at a reduced cost. Consumers are likely to buy the cheaper products, as it would be difficult to justify the increase in the price while your competitors are constant. The population may not be aware that the companies use different raw materials.

References

Quelch, J. & Beckham, H. (2011). Clean Edge Razor: Splitting Hairs in Product Positioning. Harvard Business School, 1–10.