Uploaded by Fernando Pinto

OTC Tech Growth Strategy: A Business Case Study

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Healthy growth for
OTC Tech
Background
About us
OTC Tech sells over-the-counter diagnosis products. The company was
set up four years ago in Copenhagen, Denmark, by Anders Larsen, an
engineer with a passion for the “mechanics” of the human body, and Ulla
Hofmann, a research chemist with many years’experience in the
pharmaceutical industry.
OTC Tech was bom out of a personal experience. The need for a routine
test entailed a week-long wait to see the family doctor, followed by a trip to
the hospital for the test, and finally the results were received over the
telephone. The whole process took three weeks. In the end, it just seemed
that life would be easier for all concerned if patients had easier access to
such tests.
A start-up company making diagnostic test
kits is looking for ways to grow its business
OTC Tech
Home | About us | Products | Research | Tests
The use of home pregnancy tests is now very common, so why shouldn't
other easy-to-use diagnostic test kits for a wide range of conditions be
available for home use?
There are many good reasons for people to take control of their own health,
and OTC Tech can help by providing you with home-test kits. Our range of
products includes a cholesterol test, diabetes tests and allergy testing.
What problems do you think this new business might have selling
its products?
REVIEWING CURRENT PERFORMANCE
Growth at OTC Tech has been consistent over the first couple of years, but a
little slow. The company directors recently hired a consultant to help them
decide how to develop the business.
WAYS WE CAN ACHIEVE GROWTH AT OTC
1. Try to increase sales of existing products to our existing customer base. How can we increase the frequency
of purchase ad maintain customer loyalty?
2. Diversify and start to sell new related products that potential customers currently buy from our competitors,
e.g. home pregnancy tests.
3. Move into other areas of the industry, e.g. low-tech items, like blood-pressure monitors, or high-tech monitoring
equipment.
4. Increase spending on R&D in order to develop and market new products. We could work on joint projects with a
university or hospital research centre.
5. Find new distribution channels. Our products could be sold via new or emerging channels which might boost
sales, e.g. e-commerce.
6. Consider overseas expansion. Which markets would provide most opportunities? For instance, the US is the
world's largest market for medical products.
7. Outsource manufacturing to a country with lower labour and production costs, and focus the business on R&D,
marketing and sales.
8. Form strategic partnerships e.g. with a company selling dietary products or herbal remedies.
WRITING
You are one of the OTC
directors. After reading the
report on your left, out of
the eight options
presented, choose two of
them and write an email to
the consultant explaining
why you think they are the
best for the company.
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