2. ACME Lamb Alan Lawrence Tanesa Leib Megan Lynch Trista Myers Ag Ec 495 December, 2006

3. Outline History Operations Management Human Resources Marketing Financials Conclusion

4. ACME Lamb “Discover the difference” Innovative company created by the Saskatchewan Sheep Development Board Focus is to add value to lamb by producing additional products from less desirable cuts

5. Product Line Seasoned Lamb Kabobs (cooked and uncooked) Parmesan Lamb Meatballs Greek Style Lamb Meatballs Tunisian Lamb Cocktail Sausages Assyrian Lamb Sausage Mediterranean Lamb Sausage Roasted Garlic & Peppers Lamb Sausage Moroccan Lamb in Orange Sauce

6. Flow of Work

7. TML Production Layout Processing Cooking Frozen Finished Product Packaging Spices

8. Capital Budget Processing contracted out Outsourced companies incur costs Contract and rental costs

9. Working Capital DescriptionEstimated Cost Accounts Receivable $63,623 Raw Inventory $72,379 Inventory in progress $1,814 Finished Inventory $1,814 Accounts Payable $57,591 Total Net Working Capital $82,038

10. Cost of Goods Sold Beg Finished Goods Inventory $0 Cost of Goods Manufactured $662,191 Goods Available for Sale $662,191 End Finished Goods Inventory $0 Cost of Goods Sold $662,191

11. Accounts Receivable & Accounts Payable RECEIVABLE Co-op, Butcher Boy $5,302 Total $5,302 PAYABLE Sunterra $37,917 Blends$1,517 Saputo$380 Sterling Packaging$3,150 VersaCold$1,274 Thompson Meats Ltd.$10,800 Total $55,038

12. Cash Conversion Cycle 37 day Cash Conversions Cycle – Raw Material Inventory of 7 days – Finished Goods Inventory of 30 days – Receivables of 30 days – Payables of 30 days CCC = 7 + 30 + 30 – 30 = 37 Days

13. Operations Management Organizational Structure Board of Directors (8 members) General Manager Administrative Assistant Marketing Representative Accountant

14. Human Resources Strategy CPL Goals – Operations administered by phone – Keep CPL employee numbers low – Hire marketing representative

15. ACME Employees 2007 – General Manager – Accountant – Administrative Assistant 2010 – General Manager – Marketing Representative

16. Marketing Objectives and Goals Use all trim provided by Sunterra Meats by 2015 – Approximately 360 000 units of sausage or meatballs Alter proportion of product sales within CPL Establish four to five working relationships with retail and wholesale outlets per year – Large urban centers

17. SWOT Analysis - Internal Strengths Knowledge of industry within company Unique product Minimal number of employees Physical resources Weaknesses Limited capital Promotion Limited employee time

18. SWOT Analysis - External Opportunities Market trends Convenient product Threats Competitors Agriculture and Agri-Food Canada, 2005

19. Place Co-op Saskmade Marketplace Expand into new markets – Costco – Trader Joes – Thrifty’s – West Coast – Longo’s – East Coast

20. Promotion Print Taste tests Trade shows Samples Coupons Meal ideas

21. Segmentation, Targeting & Positioning Male and female customers Age range 25-45 Middle to High Income Urban consumer Ethnic consumers Large urban centers

22. Market Analysis CPL Products Unit Quantity (grams) PriceCompetitor and Product Unit Quantity (grams) Price Lamb Kabobs600$ 12.99 Chicken Pineapple Mini-Skewers 500$ 8.99 Lamb Meatballs 908$ 10.99 Country Morning Swedish Meatballs 800$ 8.99 Lamb sausage300$ 3.49 Johnsonville Hot and Serve Bratwurst 500$ 5.99

23. Financials Investment of $79,000 in 2007 – Equity capital – Loan at 8% Inflation rate 2% Growth rate 10%

24. Financials - Comparison 20072014 Sales Revenue $ 774,075 $ 1,872,119 COGS $ 660,377 $ 1,463,464 Admin & Mkt Expense $ 96,260 $ 229,491 Net Income $ 17,438 $ 179,164

25. Financials - Ratios

26. Financials Net present value $-95,937 IRR 35.7% ERR 25.2%

27. Financials – Critical Variables Price of lamb kabobs – Allowable change of -8% Growth and inflation rate for direct costs – Allowable change of 8%

28. Conclusion Focus on selling profitable products Increase sales Hire marketing representative Explore different methods of promotion

29. Any Questions?