SWOT analysis for Sagacity Tea

SWOT analysis for Sagacity Tea

Sagacity Tea is a successful company which built premium quality of New England brand of organic, sugar free, ready to drink tea. Kate Moran along with her husband Steve Benton has successfully able to manage the company and they manage to refined it into three subtle flavors of tea which was a game changer in both local farmers market and artisanal food stores in New England. This was the little introduction of Sagacity Tea company. A SWOT analysis for Sagacity Tea are describe as follow:

Strengths

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-Sagacity Tea is a company which is located in Burlington, Vermont and their strength for me would be New England where they built unique quality of foods and drinks.
- Another key strength for Sagacity Tea company would be Steve Benton’s unique formula which makes the company ideal for the niche target market and maybe it was the company core competency as brand.
- This product is very popular among to health-oriented stores, since this product is very healthy to customers due to this reason the product is being sold in high price range.
- Social media is another strengths for Sagacity Tea to run their business in the future. Steve use social media platforms Facebook live to promote their product across the country.

Weaknesses

As we all know that in order to run the business successfully you got to know weakness, and make your weakness into strengths.
- Even though, the product was popular in Asian countries like China and Japan, but the main concern was this product were new to United States which is why their product was not known in the market.
- Since the product is not familiar to the American target market, their online sales made only 5% of their total sales.
- They had limitation for expansion meaning they don’t have more physical stores or they need more e-tailer to increase their sales revenue.
- Due to the lack of capital and financial resources they haven’t achieved their goal of national distribution.

Opportunities

A product like Sagacity Tea has many reason to perform their business better. I am one of many consumers who likes to drink tea like Herbal tea, Green tea etc.., which is why the this product can be sold and consume by any age group people since it offer you many health benefits, and keep your mood happy. A opportunities for Sagacity is started to seen in the east side of U.S. as the their daily consumer percentage has increase to 34%. Beside that, E-commerce can provide opportunities to the company and also with the help of social media platforms, the business of this product can be accessible to each and every consumer in the nations.

Threats

- Competition and rival companies like Evy Tea and Role Tea, which are running their business Boston and Washington D.C.
- They will face potential threats in e-commerce ventures as there are other brand options available.
- Inflexibility in price can also affect the overall retail sales.

2. What are the pros and cons of each expansion option?

Pros

-Keeping their loyal customers happy.
- Developing a product with lots of growth opportunity.
- provides good ROI to the customers.
- Determine small scale profits where they can uphold the business in the run long.
- Sell sagacity on major online retailers such as amazon.

Cons

-Other regional RTD is also following the same procedure of using e-commerce
as the substitution for expansion distribution.
- Others brokers won’t be able to reduce standard trade promotion expectations.
- Stiff competition from other brands can force to cut of its current margin.
- Changing packaging from glass to plastic can alienate their core customers.
- Big companies might take sagacity’s customer due to the larger availability of consumption.

3. What option should Moran and Benton choose, and why?

The goal of the Sagacity Tea Company is to supply their product all over the country. In order to reached desired goal Sagacity Tea Company have the five option how they can reached their desired goal. These five option are as follows
0.To hire a brokerage company which they can charges from the current financial possibilities of the company. That way they have to get loan for that.

1. To focus on online sales
2. To search and find the alternative of different brokerage
3. To hire a distributer who can charge less than broker
4. Just keep continuing their regional sales.

Investors started to pressure the company owner because peak buying season was approaching soon and they were also worried about the other companies and competition so they need to make a move faster. After thinking carefully about the possible expanse and their advantages and disadvantages of this they came to conclusion to adopt two possible option.

1. First, they have to try to grow their online presence. This includes working on their website and online advertising. Also finding a good place to promote their product. such as, bringing their product to amazon, eBay or different online store that customer can find their product easily. They also have to promote their product to different social media to increase the marketing strategies and providing awareness about this product.
2. Second they have to search different brokerage firm and find the best option to sign and work with them.

In order to fulfill their long term goal to distributing their product to nationwide they also need to expand their company/facilities. Some of the alternative also including to build partnership with other companies such as Starbucks so they can gain their customer loyalties and this can help to gain their popularities and sales.

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