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Lassonde Inc Case Study

Essay by   •  February 23, 2012  •  Case Study  •  2,475 Words (10 Pages)  •  1,987 Views

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Introduction

Lassonde Inc is a company that takes big pride into its entrepreneurial attitude and has been very innovative in terms of packaging products. The company specializes in fruit juice, specialty food products (such as sauces, soups, gravies and cheese and chocolate fondues) and the packing and marketing of imported wines. The company was founded in 1918 by Sir Aristide Lassonde in the town of Rougemont about 50 kilometres away from Montreal. The company was at first only a cannery and the products were canned tomatoes and canned beans, which were sold in the surrounding region. Sir Aristide Lassonde died in 1944 and left the company under the control of his son Willie Lassonde who brought the fruit juice production into the company. This was the turning point in the company's history because Lassonde Inc is now one of the leading manufacturers of fruit juice and drinks in Canada. The company has grown a lot by purchasing many other companies (what other companies did they buy?) that also lead them to diversify their production mix a lot. Buying other companies is a growth strategy called integration, in Lassonde's case, they used horizontal integration, because they bought out potential competitors. Here are the companies Lassonde Inc has acquire during their history: Coopérative Montérégienne, Produits Ronald, Vac-o-Nut, BHR Bakers Specialties Ltd., Greatvalley Juices Inc, Orange Maison Inc, Mar-Brite Foods Co-operative Inc, Alfresh beverages Canada Corp, Mondiv, Apple Valley Juice Corporation and Clement Pappas and Company Inc which they recently bought in 2011.These are mostly juice producer or speciality food producers and their purchases are the cause of the success that Lassonde Inc has today. The company also created Arista Wines Inc in 2006 which is a subsidiary, or one of the branches of the company, concentrating on the packing and distribution of imported wines. Today the company has four business units: A. Lassonde Inc, Clement Pappas and Company Inc, Lassonde Specialities Inc and Arista Wines.

Marketing

In 1977, the same year that Lassonde Inc became a public company, the company also bought Effex marketing, a Montreal food broker. The company has then benefited from a brokerage firm inside their own company and this permits them to lower the cost of their marketing process. Food brokers are basically used to represent a company's product to probable distributers. For a company like Lassonde Inc, which is producing a lot of different types of products, it is crucial to effectively sell those products to the adequate distributor and brokers are qualified people to do so. They benefit from better relations with buyers and are especially competent in the specific market of the company's production, in this case, the food market. Regarding the target market Lassonde have, considering they are selling non expensive food and juice, their target market would people the general public who buy everyday food and beverages.

A very successful aspect of Lassonde Inc marketing would be their product mix. They produce all kinds of fruit juices, marinades, sauces, fondue sauces, canned products and they are even in the wine business. The company has also in its lifetime bought subsidiary companies named Vac-o-Nut and BHR Bakers to access the nuts, dried fruit and pastry markets. Having a good production mix is important for a company because it provides many services to the customers in different specific markets. Lassonde Inc is dealing in the food market, where there are many competitors, so having different production lines to satisfy several of the customers' needs is important to motivate the customers to keep buying the company's products.

Lassonde Inc is selling products under different brands names to create the illusion of competition, which is a very descent strategy to have. The company that owns Future Shop and Best Buy also use this strategy. Let's take the example of the subsidiary of Lassonde Industries Inc named A. Lassonde Inc. The company is selling juice under the following brand names: Rougemont, Oasis, Fruité, Nature's Best, Tetley, Allen's, Mitchell's, Sunkist, Sun-Maid, and Canadian Club. These are most of the juice brands we find on the shelf of our local grocery store. So often when a customer is hesitating between two brands of juice in reality, whether he chooses one or the other, the money from that is still going to the same company. This strategy can be profitable when the time comes to offer discounts on products, keeping some products at their normal price when others are on discount can give the illusion of an advantageous choice to the customers. This way, Lassonde effectively increases their sells.

Lassonde successfully sells its products in all the provinces of Canada and New-England states. They also have operations in Thailand and southern China because of a partnership agreement with Tipco Foods Co. where they produce and market fruit juice and fruit nectar.

Regarding the wine market, Lassonde Inc creates Arista Wine in 2006 which specializes in packaging and marketing imported wine in Canada. What differentiates those wines from other finds on the retailers' shelf is their innovative new way to package the wine named the Vino Pack. The company uses cardboard boxes instead of the usual glass bottle. The company classified this new packaging technique as an environmentally-friendly alternative to the glass bottle. Lassonde Inc found a very smart way to adapt to new realities which is crucial for a business to be successful.

Production

The Lassonde society is using several production factories related to the food sector all around Canada. Here is a list of these facilities; A. Lassonde Inc in Rougemont (Quebec), Greatvalley juices in Port Williams (Nova Scotia), Les Jus Lassonde in Ruthven (Ontario), Golden town apple Products in Thornbury (Ontario), Lassonde beverages Canada in Toronto (Ontario), Lassonde Western Canada in Calgary (Alberta), Specialitiés Lassonde Inc in St-Damase (Quebec), Mondiv in Boisbriand (Quebec). Except for the Specialties Lassonde Inc's plant, these are all used for the fruit juice production and packaging. These factories have the advantage of being mainly located in the heart of the agricultural area of their respective region, because it costs them less in transportation fees to buy from local producers.

As mentioned earlier, the Lassonde society count four subsidiary all controls a different sector of the company production. The first subsidiary name A. Lassonde Inc is focusing on the fruit juices and beverages production. This subsidiary is using seven plants, all located in different regions of Canada. It has now become the

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