Metabical Case Solution
Recommendations After Epidemic
If a company targets overweight (BMI 25-30) skilled women aged 35-65, especially if management sets the ROI to 5%, the ROI seems a bit unrealistic. Acquiring 50% of the exclusive market in 5 years is completely irrational. The price can obviously be reduced, but it is a very affordable price for the target consumers. Reducing the price is likely to damage the brand name of the recipe and prevent it from being considered an elite product. The eye of this target.
After considering Covid 19 and its impact, Metabical estimates it will capture 20%, 25%, 30%, 35% and 40% over the next 5 years. It can be assumed that women aged 35-65 have a very disposable income and will be more willing to pay for medications and weight loss prescriptions. The product has also been prescribed and approved by the FDA, so it can also prove a high price tag. In this analysis, this recommendation could still result in a return of about 70%. This change is shown in the Exhibit 2 of the document.
Exhibit 1: Calculations Before Epidemic
| Method 1: | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
| Number of Americans with BMI between 25 and 30 | 78,200,000 | 78,200,000 | 78,200,000 | 78,200,000 | 78,200,000 | |
| x 35% actively trying to lose weight | 27,370,000 | 27,370,000 | 27,370,000 | 27,370,000 | 27,370,000 | |
| x 15% who are comfortable using diet pills | 4,105,500 | 4,105,500 | 4,105,500 | 4,105,500 | 4,105,500 | |
| 10% who might purchase Metabical in Year 1 adding 5% each subsequent year | 410,550 | 615,825 | 821,100 | 1,026,375 | 1,231,650 | unit sales |
| plus 60% buy a second package | 246,330 | 369,495 | 492,660 | 615,825 | 738,990 | unit sales |
| plus 20% of these buy a third package | 49,266 | 73,899 | 98,532 | 123,165 | 147,798 | unit sales |
| Sales | 706,146 | 1,059,219 | 1,412,292 | 1,765,365 | 2,118,438 | unit sales |
| Method 2: | ||||||
| Number of Americans with BMI between 25 and 30 | 78,200,000 | 78,200,000 | 78,200,000 | 78,200,000 | 78,200,000 | |
| x 12% say they will go to a doctor to request prescription | 9,384,000 | 9,384,000 | 9,384,000 | 9,384,000 | 9,384,000 | |
| 10% who might purchase Metabical in Year 1 adding 5% each subsequent year | 938,400 | 1,407,600 | 1,876,800 | 2,346,000 | 2,815,200 | unit sales |
| plus 60% buy a second package | 563,040 | 844,560 | 1,126,080 | 1,407,600 | 1,689,120 | unit sales |
| plus 20% of these buy a third package | 112,608 | 168,912 | 225,216 | 281,520 | 337,824 | unit sales |
| Sales | 1,614,048 | 2,421,072 | 3,228,096 | 4,035,120 | 4,842,144 | unit sales |
| Method 3: | ||||||
| Ideal target (overweight females, 35-65, college-educated) | 4,300,000 | 4,300,000 | 4,300,000 | 4,300,000 | 4,300,000 | |
| 30% who might purchase Metabical in Year 1 adding 5% each subsequent year | 1,290,000 | 1,505,000 | 1,720,000 | 1,935,000 | 2,150,000 | unit sales |
| plus 60% buy a second package | 774,000 | 903,000 | 1,032,000 | 1,161,000 | 1,290,000 | unit sales |
| plus 20% of these buy a third package | 154,800 | 180,600 | 206,400 | 232,200 | 258,000 | unit sales |
| Sales | 2,218,800 | 2,588,600 | 2,958,400 | 3,328,200 | 3,698,000 | unit sales |
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