Sr.No. Application No. Enrolment No.

Student Name Section Email ID Groups

1 2204709 220101038 Eira Singh G pgp22eirasingh@imt.ac.in 1

2 2209993 220103095 Kritika Singh G pgp22kritikasingh@imt.ac.in 1
3 2210875 220201122 Tanmay Singh Chilwal G dcp22tanmaysinghchilwal@imt.ac.in 1
4 2215260 220103059 Divya Rakeshkumar Jain G pgp22divyarakeshkumarjain@imt.ac.in 1
5 2214953 220103160 Satyam Chanana G pgp22satyamchanana@imt.ac.in 1
6 2208508 220103221 Nikhil Kumar Bajaj G pgp22nikhilkumarbajaj@imt.ac.in 1
7 2200061 220101019 Arjun Kalia G pgp22arjunkalia@imt.ac.in 1

By-the-Sea Biscuit Case Study

Q1. Based on the information given in the case, what is the market potential for
frozen biscuit sales in the following markets – New England States, New York
and Atlantic Canada.

Market size
Price Chopper for NY and New England
market share population potential size price Sales
Albany, NY 36% 95685 34447 $14.33 $4,93,619.78
Worcester, MA 19.50% 172684 33673 $14.33 $4,82,539.54
Utica-Rome, NY 17.60% 299896 52782 $14.33 $7,56,361.70
Burlington, VT 11.60% 608827 70624 $14.33 $10,12,040.95
Poughkeepsie, NY 6.70% 29871 2001 $14.33 $28,679.45
Syracuse, NY 12% 143306 17197 $14.33 $2,46,429.00
Total Potential $30,19,670.41

Atlantic Canada 20% 2285729 457146 $12.20 $55,77,178.76

By-the-Sea Biscuit wants to distribute in the Atlantic Canada and US’ New England and New York
states via Co-op Atlantic and Price Chopper respectively. Price Chopper has a market share of
between 6-36% and Co-op Atlantic has a 20% market share. Total Potential is relatively larger in
Atlantic Canada as compared to the US market.
Q2. Prepare a sales forecast for year 1 for By-the-Sea biscuit company for both
Neweastern US and Atlantic Canadian markets.

Burlington, VT Albany, NY Utica Rome, NY Syracuse, NY Poughkeepsie, NY Worcester,MA Atlantic Canada

Market share percentage 11.60% 36.00% 17.60% 12.00% 67.00% 19.50% 20.00%
City Population 6,08,827 95,658 2,99,896 1,47,306 29,871 1,72,648 22,85,729
1st month - - - - - - -
2nd month - - - - - - -
3rd month - - - - - - -
4th month - - - - - - -
5th month 7,062 3,444 5,278 1,768 2,001 3,367 45,715
6th month 14,125 6,887 10,556 3,535 4,003 6,733 91,429
7th month 21,187 10,331 15,835 5,303 6,004 10,100 1,37,144
8th month 28,250 13,775 21,113 7,071 8,005 13,467 1,82,858
9th month 35,312 17,218 26,391 8,838 10,007 16,833 2,28,573
10th month 35,312 17,218 26,391 8,838 10,007 16,833 2,28,573
11th month 35,312 17,218 26,391 8,838 10,007 16,833 2,28,573
12th month 35,312 17,218 26,391 8,838 10,007 16,833 2,28,573
2,11,872 1,03,311 1,58,345 53,030 60,041 1,00,999 13,71,437

This is a population-based sales forecast.

 Only traditonal
1st month $ - $ - $ - $ - $ - $ - $ -
2nd month $ - $ - $ - $ - $ - $ - $ -
3rd month $ - $ - $ - $ - $ - $ - $ -
4th month $ - $ - $ - $ - $ - $ - $ -
5th month $ 5,296.79 $ 2,582.77 $ 3,958.63 $ 1,325.75 $ 1,501.02 $ 2,524.98 $ 34,285.94
6th month $ 10,593.59 $ 5,165.53 $ 7,917.25 $ 2,651.51 $ 3,002.04 $ 5,049.95 $ 68,571.87
7th month $ 15,890.38 $ 7,748.30 $ 11,875.88 $ 3,977.26 $ 4,503.05 $ 7,574.93 $ 1,02,857.81
8th month $ 21,187.18 $ 10,331.06 $ 15,834.51 $ 5,303.02 $ 6,004.07 $ 10,099.91 $ 1,37,143.74
9th month $ 26,483.97 $ 12,913.83 $ 19,793.14 $ 6,628.77 $ 7,505.09 $ 12,624.89 $ 1,71,429.68
10th month $ 26,483.98 $ 12,913.83 $ 19,793.14 $ 6,628.77 $ 7,505.09 $ 12,624.89 $ 1,71,429.68
11th month $ 26,483.98 $ 12,913.83 $ 19,793.14 $ 6,628.77 $ 7,505.09 $ 12,624.89 $ 1,71,429.68
12th month $ 26,483.98 $ 12,913.83 $ 19,793.14 $ 6,628.77 $ 7,505.09 $ 12,624.89 $ 1,71,429.68
$ 5,15,698.13 $ 10,28,578.05

This is a revenue-based sales forecast.

Burlington, VT Albany, NY Utica Rome, NY Syracuse, NY Poughkeepsie, NY Worcester,MA Atlantic Canada

1st month
2nd month
3rd month
4th month
5th month 392 191 293 98 111 187 2540
6th month 785 383 586 196 222 374 5079
7th month 1177 574 880 295 334 561 7619
8th month 1569 765 1173 393 445 748 10159
9th month 1962 957 1466 491 556 935 12698
10th month 1962 957 1466 491 556 935 12698
11th month 1962 957 1466 491 556 935 12698
12th month 1962 957 1466 491 556 935 12698

Number of cases-based forecast.

The production will begin from the 5th month as it will take 4 months to set up
the production line. Starting from the 5th month, there is a 10-percentage point
increase in market capture, capped at 50%.
 75 % traditonal + 25% Flaxseed
1st month $ - $ - $ - $ - $ - $ - $ -
2nd month $ - $ - $ - $ - $ - $ - $ -
3rd month $ - $ - $ - $ - $ - $ - $ -
4th month $ - $ - $ - $ - $ - $ - $ -
5th month $ 5,296.79 $ 2,582.77 $ 3,958.63 $ 1,325.75 $ 1,501.02 $ 2,524.98 $ 34,285.94
6th month $ 10,593.59 $ 5,165.53 $ 7,917.25 $ 2,651.51 $ 3,002.04 $ 5,049.95 $ 68,571.87
7th month $ 17,876.68 $ 8,716.84 $ 13,360.37 $ 4,474.42 $ 5,065.93 $ 8,521.80 $ 1,15,715.03
8th month $ 23,835.58 $ 11,622.45 $ 17,813.82 $ 5,965.89 $ 6,754.58 $ 11,362.40 $ 1,54,286.71
9th month $ 29,794.47 $ 14,528.06 $ 22,267.28 $ 7,457.37 $ 8,443.22 $ 14,203.00 $ 1,92,858.38
10th month $ 29,794.47 $ 14,528.06 $ 22,267.28 $ 7,457.37 $ 8,443.23 $ 14,203.00 $ 1,92,858.38
11th month $ 29,794.47 $ 14,528.06 $ 22,267.28 $ 7,457.37 $ 8,443.23 $ 14,203.00 $ 1,92,858.38
12th month $ 29,794.47 $ 14,528.06 $ 22,267.28 $ 7,457.37 $ 8,443.23 $ 14,203.00 $ 1,92,858.38

Q3. Prepare an income and expense statement for the By-the-Sea biscuit
company for year 1.

Expense & Income statement Expense & Income statement

Sr no. Particulars Amount Sr no. Particulars Amount
1 Bakery line 2 $ 74,000.00 1 Bakery line 2 $ 74,000.00
2 Rent and Electricity $ 90,000.00 2 Rent and Electricity $ 90,000.00
3 Production Labour $ 2,10,000.00 3 Production Labour $ 2,10,000.00
Salaraies (Managers) with Salaraies (Managers) with
Mandatory employer Mandatory employer
4 costs $ 44,800.00 4 costs $ 44,800.00
5 Raw material $ 30,000.00 5 Raw material $ 30,000.00
6 Research $ 10,000.00 6 Research $ 10,000.00
7 Office Equipment $ 2,400.00 7 Office Equipment $ 2,400.00
8 Marketing and travel $ 19,000.00 8 Marketing and travel $ 19,000.00
9 Monthly Interest payments $ 7,500.00 9 Monthly Interest payments $ 7,500.00
10 Operating cost $ 4,87,700.00 10 Operating cost $ 4,87,700.00
11 Variable cost $ 7,78,709.93 11 Variable cost $ 9,34,451.91
12 Depriciation $ 7,400.00 12 Depriciation $ 7,400.00
Total Expense $ 12,73,809.93 Total Expense $ 14,29,551.91

Projected Revenue $ 15,44,276.18 Projected Revenue $ 17,18,007.25

Operating Profit $ 2,70,466.26 Operating Profit $ 2,88,455.34

Table A Table B
Table A represents the Income statement for traditional biscuits, Table B
represents traditional and organic biscuits.

Q4. What is the break-even point? What risks are involved in the business?
Profit = Revenue – Expenditure
= 13.5x – ( 4,87,700 + 7.78x)
Where x denotes no. of cases sold.
The break-even point for traditional frozen dough biscuits will be achieved in
the 11th month.
Risks involved:
• Fluctuating Currency Exchange Rates would impact their ability to sell in
US markets. Cash Flow is affected by fluctuating rates.
• Competitors like Canada Bread Company have a 50% market share in the
US markets. Although prices are competitive, shipment to US will cost
more as compared to Canada so there has to be a differentiator in terms
of product USP to capture some share in the US market.
• All the calculations and assumptions are based on the US for Canadian
markets. Hence, a lack of information regarding Canadian markets and
frozen biscuits in particular, can be a concern.
• . Since the company is not focussing on consumer-based advertising, it
might lose its share to competitors in the long run.

Q5. What recommendations would you make for Finney and Jobe?

• Pat Jobe and Paul Finney should go ahead with the venture.
• Based on the calculations above, By-the-Sea Biscuit should enter both
the US’ New England and New York states and the Atlantic Canada
market.
• Of all the possible equipment options, bakery line 2 which costs
$74,000.00 is the most cost-effective option.
• Research for the organic frozen dough should be completed within 6
months.
• It is recommended to produce both the traditional and the organic
frozen dough biscuits, in the ratio of 75:25 as it follows the current
market trend and can be increased further on.
• Two trade shows, ApEx, Atlantic Canada and New England Food Service
and Lodging, Boston shall be attended for marketing and branding
efforts.