Butler's Chocolate Company

University Degree Business and Administrative studies

2/11/2008

Table of Contents:

Detailed description of the organisation 3

Name, Year established, Location 3

Private/Public, Purpose, 3

Products Market/Customers 4-5

Last news 6

SWOT 7-8

PEST 9-11

Conclusions and Recommendations 12

Bibliography 13

Butlers Chocolates was established in 1932 by Mrs Bailey Butler. In 1959 the company was purchased and has been owned by Mr. Seamus Sorensen since that time. The Butlers Irish Chocolates brand was born in 1984. It was named in memory of Ms Marion Bailey Butler. Butlers Chocolates is located is Clonshaugh, Dublin 17 since 2003.

It is a private manufacturing limited company. The company is the leading luxury chocolate producer in Ireland and operates from a custom built production facility in North Dublin. The starting point was, when in 1932, Mrs. Bailey-Butler began to produce a range of handmade chocolates from her house in Dublin’s Fitzwilliam Square. The company produces a wide range of delicious confectionery products including chocolate assortments such as truffles, fudge, toffee, chocolate bars and seasonal novelties.
In November 1998 the first Butlers Chocolate Café opened its doors on Wicklow St, Dublin. Since then, thousands of customers have visited the shops. In addition to a relaxing café ambience, Butlers Chocolate Cafés also offer a top quality retail outlet. This unique combination is now very successful. It is a unique concept that has become hugely popular with tourists and locals alike.

Butlers have also introduced many other innovations including:

mail order gifts
internet marketing
club membership
discount schemes.

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Butlers have also introduced many other innovations including:

mail order gifts
internet marketing
club membership
discount schemes.

Nowadays Butlers Chocolate Café has a big market. In 1998 due to new website went live, fourteen Butlers Chocolate Cafés have opened, including 2 franchises in New Zealand. Retail shops have already opened up all over Ireland. The company has created a very successful concept - Butlers Chocolate Cafe’s - of which there are now 8. There is a flagship cafe at Dublin Airport and another one at Dundrum Town Centre. The most recent cafe opening has been in Oliver Plunkett Street in Cork last December. Butler's have also expanded into the U.K market and their chocolates are now widely available in most major airports throughout the UK and at Waitrose stores.

From 2006 to the present day Butler's have developed new products, launching their first organic chocolate range, dark chocolate selection, 200g Chocolate cube range, Butlers Chocolate Café ice cream as well as Take Home Ice Cream amongst others. Also in collaboration, Butlers Chocolates launched a range of chocolates with Irish Fashion designer, Orla Kiely.

The Cafe’s are a unique concept and offer the consumer the ultimate chocolate treat.

This treat is delivered by way of chocolate drinks, chocolate cakes and pastries and hot beverages, including the award winning Butlers Hot Chocolate. Their Hot chocolate Sauce has won a gold medal at the London Great Taste Awards. The company has won a number of awards in recent years including the Bord Bia Brand Marketing Award and the Crest Retail Excellence Award for Butlers Chocolate Cafe, Henry Street.

What make Butlers chocolates so different is the combination of the finest chocolate with fresh Irish cream, butter, eggs and secret recipes. Butlers Irish Handmade Chocolates are still located in Dublin and Mrs. Bailey-Butler’s original recipes and techniques have been handed down to the present generation. They have stood the test of time, winning many top awards, in Ireland and abroad.

The Irish Chocolate Company supplies three distinct markets. First one is an international duty free market which was opened in Ireland’s main airports such as Dublin, Shannon and Cork. In addition, duty free outlets were sourced on the ferry routes between Ireland and the UK.

Also the company produces a range of gifts that have been proven very successful in international market including England, US, Russia and Dubai.

It has gained a significant foothold over the last four years in the domestic market as well. The company has strived to choose stores that are match with the Butlers brand, looking for prestige, exclusivity and luxury.

2008:

February - Butlers introduce a new 200g Chocolate cube range in three flavours; , and .

June - Butlers launch a new .

at the prestigious Shopfitting & Display Industry Awards 2008

August - .

Butlers Chocolates is to expand its network of Butlers Chocolate Cafes into the US. The luxury chocolate maker is to open its first outlet in New Jersey with future openings expected in the following 18 months. Butlers also opened its first UK store in the high-profile Westfield shopping mall in London last week.

SWOT Analysis

Strengths, Weaknesses, Opportunities and Threats (SWOT)

SWOT analysis is a tool for auditing an organisation and its environment. It is the first stage of planning and helps marketers to focus on key issues. Strengths and weaknesses are internal factors. Opportunities and threats are external factors.

SWOT analysis show where a business should focus its attention.

Butler’s chocolate company could pitch the following strengths and weaknesses against the opportunities and threats.

Internal

Strengths:

Irish market leader in a handmade and luxury product: chocolate. The brand, instantly recognisable fro the luxurious white and gold embossed presentation boxes.
The Irish company has maintained a progressive orientation to using the Internet to expand its reach and penetration. Regarding the case study the company felt the area of mail ordering was potentially a very profitable market and the Internet was the best vehicle for opening up new markets and building a new customer base.
Chocolate leader in several big markets including: UK, US.
Faster decision making and ability integrates competitive products into problem-solving system.
Differentiated products. Butler’s company makes move into organic. “Irish speciality chocolate company Butlers Chocolates is launching a range of organic chocolate bars which includes four new varieties; organic milk chocolate, 70% dark, white chocolate with raspberry and milk chocolate with orange pieces.”

Weaknesses:

Relatively low advertising and promotions budget. For instance: “These delicious and mouth watering chocolate truffle bars from Ireland. Choose from Jameson Irish whiskey, Irish Cream Liqueur, and Irish coffee.” It is an online advertisement about chocolate truffle bars with the Irish coffee flavour, which I have never heard before.
Product range needs many certain skills. As it is a handmade product, I can not imagine how many people work on it.
It has not a full access to the system to make any modifications. Butlers purchased the hardware and software equipment and Labyrinth maintain the actual system. Therefore for Butler’s perspective it is very important for them to be able to maintain and update the site themselves.

PEST Analysis

An essential input into the analysis of opportunities and threats is the PEST analysis because management must be aware of the major changes in the environment in which its business operates.

PEST analysis stands for “Political, Economic, Social and Technological analysis” and describes a framework of macroenvironmental factors used in the environmental scanning component of strategic management. It is a part of the external analysis when conducting a strategic analysis or doing market research and gives a certain overview of the different macroenvironmental factors that the company has to take into consideration. It is useful strategic tool for understanding market growth or decline, business position, potential and direction for operation.

External

Opportunities:

Current economic conditions create both problems and opportunities for marketers. Companies are facing declining demand and see few opportunities for growth. These days customers want value and more value. Increasingly, marketers must deliver offerings that delight and satisfy customers.

Social: People became well-educated and want more value for the quality. Corporate ethics has become a hot topic in almost every business area. For instance the obesity and as a consequence of it, the diabetes became overall problem in our society and the company needs to find a nice way to aware people. So the company must take responsibility for the social and environmental impact of their action.
Economic: Butlers Chocolates is to expand its network of Butlers Chocolate Cafes into the US. The luxury chocolate maker is to open its first outlet in New Jersey with future

openings expected in the following 18 months. Butlers also opened its first UK store in the high-profile Westfield shopping mall in London last week.”

Technological innovation: Explosive growth computer and informational technology has had a major impact on the way the company brings value to their customers. Although the value of a Web site is difficult to measure, the actuality is that the company has made a lot of money from its Internet efforts. New technologies create new markets and opportunities. Therefore the web-department should watch the following trends in technology to increase online buyers.

Threats:

Economics: In economic situation like we face nowadays the company may expected decrease in customer’s demand. Therefore to be successful, the company will have to be strongly market focused.
Competitive price pressure: Competition from other European confectioners has intensified. Also we can see threats from substitutes because of the growth of discounters such as Aldi and Lidl.
Higher input prices: For instance: Butlers Irish Giftwrapped Assortment (500 g) costs €25. There are a lot of competitive prices around.
Political: Threats from imports. For example: France still remains a leader in the luxury chocolate.
Regulation and legislation: Access to food technology should also helps the company face changing consumer tastes and legislation. Therefore European Union legislation will force manufactures to disclose the content of their product. This will adversely affect the attractiveness of some ingredients.

Conclusions and Recommendations

In summary, from the case study we can see that the marketing concept of the company is to determine the needs and wants and to deliver the desired satisfactions more effectively and efficiently than competitors do. It is market-focused and customer-driven company. Managers and employees use a creative entrepreneurial freedom, thinking and acting as if it were their own company.

I guess there is no reason to expect any competitors for the company in Ireland at least for next five years. Despite on it I would recommend to create a promotional and advertising plan to keep the company on the right direction and not to loss their costumers.

The Internet is a different selling medium. Therefore it is a vital that the web-focused department maintains and keeps up-to-date its site all the time.

As the chocolate’s confectionery market is concentrated and very competitive, the management must be focused on harmful threats and prepare plans in advance to meet them.

Bibliography

http://www.independent.ie/business/irish/ 7 November 2008

International Marketing p112