Taco shells Devin McDonough Spring 2013

Introduction Taco Shells seems to be controlled by Manufacturers Only 5 National Brands participate Very little Private Label presence Betty Crocker is the leading manufacturers, but the others are not much behind Harp’s carries the largest depth of SKUs, but does not have the highest GMs Consumers are not brand loyal and are willing to switch Assortment is not very important to this category Target carries only 5 SKUs and has the lowest GMs Little to no category management-no Private Label Only 2 brands

Harp’s Wal-Mart Harter House Country Mart Target 22 16 12 7 5 Number of Sku’s 16 Wal-Mart 5 Target 22 Harp’s 12 Harter House 7 Country Mart I found only 34 SKUs at the 5 stores audited The assortments varied with a rather large range of 17 Taco Shells were not carried at Walgreens, Dollar General or Sam’s Club Taco Shells have not been audited in previous semesters

Popular in families with kids demographics Popular in families with kids

According to Blattberg’s Category Role Matrix, Taco Shells are ‘Under Fire’ because the sales dollars are medium and the GM% is low Based on Competition and Penetration, Taco Shells are classified as ‘Win with Depth’ Interesting because of the large range of SKUs Taco Shells show a fairly low GM% with an average of 20% across retailers Only penetrate 21.5% of houses in the total US, so not a very large percentage of households Only buy about 6 times per year Category role

Display space Betty Crocker gets the most display space Kraft gets less display space than # of SKUs should bring Private Label gets very little display space

Leading Manufacturer Betty Crocker Found in all stores No single SKU found in all stores Prices are within a few cents of competitors’ Old El Paso brand

Gross Margins Private Label shows strongest at Harp’s and Country Mart La Tiara Produces highest GM% Taco Shells show low GM% Harp’s seems to have too many SKUs and Target too few

GM% and Facings

Private Labels in Taco Shells are not very strong brands and get very little display space Private labels have an average of 25% gross margin All stores but Target carried Private Label brands Harp’s, Harter House and Country Mart have 3 different SKUs of Private Label Wal-Mart only carries 1 SKU of Private Label and displays it on the top shelf in the furthest right facing PRIVATE LABELS

Private Label Presence I think Private Label will have a decreasing presence in the future of the Taco Shell category Stores do not display them as well as national brands Wal-Mart even has separate displays outside of the Hispanic Foods aisle for Taco ingredients Stores are making more on Private Labels but not much There are no Private Label Taco Kits-which are very common in national brand SKUs

Harp’s recommendation Increase Private Label Increase the attention to Private Label Add SKUs and assortment Assortment Cut out similar SKUs (12 shells and 15 shells) Add PL meal kits Display Merchandise PL in between Old El Paso and La Tiara shells, in middle of display