Three years ago, Kraft added a major brand to its portfolio with the acquisition of Nabisco. A.1. is the overall market leader, thanks to low competition, substantial sales and exceptional profit margins. The century-old tradition of A.1. is not the only factor that has helped build brand awareness and loyalty. Retailers, such as grocery stores, are aware of the benefits of A.1's strong brand equity. and in turn provides the steak sauce with a large number of shelf faces. With the variety of A.1 sauces. offers, these shelf liners go a long way in keeping the well-known brand in the minds of consumers in virtually any grocery store. In addition to strong customer preferences in grocery stores, their brand awareness is extremely high and are advertised in nine out of ten steakhouses. Currently, the steak sauce market must be considered in all strategic decisions as a mature market. Since the market has stabilized over the last year, the maturity can be attributed to unit and volume sales as well as limited room for market growth and lack of major competition. In 2002, stable sales of steak sauce were caused by market stability. The marinade market as well as the undeniable growth of 15% per year in the marinade market led to the relaunch of A.1. marinade line. Successfully, by the end of the year, the relaunch grossed $15 million and captured 10% share of the marinades category. Note that A.1. is launching a new marinade product this year that requires heavy advertising and testing. The new product requires $10 million for advertising and $5 million for consumer promotion. By the end of 2003, Marinade Line expects to lose approximately $7 million in operating...... middle of paper ......n in the selling price to find an accurate cost of goods sold of 28 million dollars. COGS is calculated by taking the contribution margin of 83% minus one and then multiplying it by revenue. Our team has exhausted the potential effects that aggressive product launch could have on A.1. Steak Sauce profits from the development of entry order models without (Figure 1.4) and with the introduction of Lawry to the market (Figure 2.1). Accompanied by the revised income statements for each, the financial repercussions of the new entry into competition, the assumptions and the strategic decisions are visible in all the figures in the appendix highlighted in red. While keeping in mind Kraft Food's goals of continued marinade line growth, new profit target and maintaining brand value/value, the team developed suggested strategies to A .1. Steak Sauce to Rival Lawry.