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Letter of Transmittal

Alok Kumar Gupta
Chairman and Managing Director
Kanpur Confectionaries Private Ltd.
Kanpur
September 12, 1987

Subject: Recommendation to Kanpur Confectionaries Private Ltd.

Dear Mr. Gupta,

On behalf of the Consulting and Analyzing Team (CAT), I present to you the report containing recommendations and the action plan for the benefit of the Kanpur Confectionaries Private Ltd.

Outline of the Report
Kanpur Confectionaries Private Limited (KCPL) is a family business that is into glucose biscuit production. It was setup by Mohan Kumar Gupta as a sugar candy business. But he soon diversified it into biscuit production unit because of market related issues and low technological requirement. Mr. Gupta had always aspired to make ‘MKG’ a leading brand. He put in a lot of efforts and that showed off. The company performed well in the earlier stages gaining a good amount of market share and profit (and hence revenues too). But due to ever increasing competition in the market, the performance of KCPL gradually started to deteriorate. Eventually, a company that gained 20 lakhs a year started losing more than 15 lakhs a year. Also, they shut off the sugar candy business. Seeing this, two companies proposed offers to KCPL.
Problem Statement: What shall KCPL do in order to regain the brand (MKG) popularity and profitability in the biscuits market and fully utilize its production capacity keeping its integrity intact?
The options include the following: 1) Accept A-One Private Limited’s (APL) proposal in addition to continuing its own production of 120 tons and stop manufacturing for Pearson. 2) Accept APL’s proposal and continue with Pearson’s production in addition to continuing its own production of 120 tons. 3) Continue with Pearson’s production and its own 120 tons and concentrate on developing the brand image.
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