Define the problem
How the company could grow revenues to $500 million for the next five years with the ultimate goal of reaching $1 billion annually in a decade.
Decision Factors (alternatives and uncertainties)
1) Recruiting Approaches: Recruiting is an obvious driver of Vector’s revenue growth. Additional investment is required to improve the recruiting approach. * Most of Cutco Revenue comes from Direct Sales * Use of Social media for recruiting * Recruiting students for winter and spring vacation beside summer vacation * The process is costly and time consumable.
2) International Expansion: Given the state of the present global economy, it is important to capture …show more content…
To increase the revenue to $500 million, Cutco should increase it’s direct sell by improving it’s recruiting approach, it should expand internationally to capture international market share, and it should also utilize internet in a more proper way to create a new sale channel. Forecast of year 2016 Revenue Direct Sales 1 $273.75 million Catalog Sale2 $22.50 million Ka-Bar/Schilling/Internet2 $23.75 million Cutco International3 $180 million Total $500 million Expenses: Direct Sales $254.56 million Catalog $21.38 million Internet $21.61 million International $171 million Total $468.55 million Net income $31.45 million
To implement these alternatives, the marketing team should consider three different processes. 1) They have to recruit and train the sellers (collage students) every winter and spring vacation in addition to the summer vacation, so they could have direct sale through out the year. Collage students usually have one-month break for Christmas and about two week break for Spring Break. The company could increase their Christmas sale by this process. The best way to recruit the sellers is using social media, like Facebook, twitter and…. 2) Some Asian countries like China, Korea and Japan have a noticeable population of households who earn $50,000 or more annually. These countries are also U.S