Zentein Nutrition Inc: Raising the Bar

Ian Dunn, Rula Al Halbouni

Product #:W35174

Supplier:Ivey

Discipline:Economics & Public Policy, Marketing

Setting:Canada, 2023

Details:Case (PDF) • 7 pages • 2024-01-25

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The founder of Zentein Nutrition Inc. needed a short-term plan for 2023 to maximize his goals for business growth and customer reach. The company was based in London, Ontario and provided natural, simple, healthy, and nutritious food alternatives to an affluent, health-conscious, and health-knowledgeable customer base. Its competitors included many large companies in a highly competitive and fragmented market, but the company had a competitive edge by offering a simple and sustainable ingredient list, use of collagen as a protein source, and made-to order protein bars. With demand outpacing supply, the founder paused all promotional efforts but the company continued to grow exponentially with only word-of-mouth promotion and a social media presence. The founder was now wondering which sales and distribution channels he should pursue for the rest of 2023, and also for the future, after supply would be increased with automation. The three sales channel options—the company website, the Amazon online platform, and traditional retail stores—each offered specific benefits and drawbacks, but the founder had to make a decision that would deliver both quantitative and qualitative results.

Learning Objectives

This case is best taught in an introductory managerial accounting course or an introductory marketing course at any academic level. Students should use cost behaviour (i.e., cost classification: fixed versus variable), contribution analysis, and break-even analysis as financial tools to quantitatively justify their decisions. Qualitatively, students should also make marketing decisions that are supported by their knowledge of the marketing mix and their analysis of the internal and external environments of the company. After completion of this case, students will be able to

analyze the internal and external environments of a company;
identify costs relevant to the decisions at hand and distinguish between fixed and variable costs;
calculate the unit contribution, contribution margin rate, and break-even point for three sales channels;
perform a sensitivity analysis on the expected profitability level for each distribution channel;
understand the practical application of quantitative concepts such as contribution analysis and break-even analysis;
prioritize goals and objectives to make decisions; and
make marketing decisions using knowledge of the marketing mix.

Zentein Nutrition Inc: Raising the Bar

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Learning Objectives