Creating a market
A Bernard Matthews case study

Page 1: Introduction

In 1950, Bernard Matthews bought 20 turkey eggs and an old incubator - a total investment of £2.50. Today, Bernard Matthews is a multi-national company with a turnover in excess of £400m, employing over 6000 people world-wide. While the core business remained turkey production, Bernard Matthews decided in 1992 to enter the pre-packed sliced cooked meat market. At the time, it seemed an...
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Page 2: Product development

Firms may try to reduce their dependency on one product because of variations in demand which can be both seasonal and cyclical. The market may have become too competitive or merely saturated. The demand for some products, those with higher income elasticity, is likely to be more adversely affected by a downturn in the trade cycle than others. Product development can be seen as a method of...
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Page 3: Product range

There are a number of stages in the development of a new product: IDEAS - the creative process of innovation/brainstorming SELECTION - the screening and evaluation of the ideas/ selection of one ANALYSIS - examination of the idea with respect to all the internal functional areas of the firm TECHNICAL - taking the idea and designing both the DEVELOPMENT - product and manufacturing...
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Page 4: Innovation

Bernard Matthews Plc is recognised throughout the food industry as an innovator. It carried out extensive market research, remodelling the product whenever it was deemed necessary. Key to the company’s success was the construction of a ‘high risk/low risk’ state of the art factory, using highly efficient automated systems to produce to the highest possible specifications. Bernard...
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Page 5: Capital investment

The capital investment for the new hitech factory in Norfolk was £6.5m in 1992, making this the company’s most expensive production line. This was followed by two further factories, one in Norfolk and the other in Hungary, at a total capital cost of around £20.5m. Although this spending may initially have been difficult for the Board of Directors to justify to the shareholders...
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Page 6: Conclusion

Profit in business is often considered to be a reward for taking risks. Sometimes firms take risks even when the initial prospects do not look encouraging - they believe strongly in their product and the firm’s strengths and capabilities. The Bernard Matthews experience emphasises the value of a strong brand. Used prudently, the brand name enabled Bernard Matthews Plc to...
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