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Dieter

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Mr. Dieter Bachembesser a well-known pastry chef at several of Toronto’s finest hotels, started a small firm called Dieter’s delicacies as a part time venture that sold fine baked goods to several of the area’s finest caterers. He used Browne’s Bakery’s Plant to produce his goods. His venture became successful, and his reputation spread over the years. In 1999, Dieter decided to make it his full time business and bought his entire product line from Browne’s and started its operations in distributions and whole sell business under the company’s own private label which was profitable venture. By 2005 Dieter’s purchases from Browne’s Bakery had grown to the point that they represented 21% of Browne’s total production for the year. In 2006, Dieter presented a proposal for a joint venture to Mr. Elmer Smith, president and major shareholder of Browne’s Bakery. The keystone of this proposal was the 5-year marketing plan. This plan showed that the sales will increase steadily which will result is market share going up to 10.1% from 6.5% in 2010.the plan also included ideas about expansion plan, addition of outlets, improvement in product quality & customer service etc. Dieter proposed that Browne’s Bakery accommodate Dieter’s plans by: expanding its manufacturing facilities and transforming some of its existing operations in order to produce new product lines that Dieter’s would be introducing over the next 2-3 years. Mr Smith was impressed by Dieter’s plan but he did not find it practical and considered it a big risk for Browne’s bakery & rejected it. Now mr Dieter’s decided to build his own plant but it was very costly and would cost him 1.8 Million to build a plant. He considered his options and went to financial institutions for her but they were unwilling to make the loans that the project required due to lack of equity. However, Dieter was able to find

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