You are hired as a consultant to produce a recommendation on a new branding strategy for a private/store brand program for a major regional successful grocery store retailer. NOTE: The retailer has about 100 stores in a 4-state area. The retailer has been doing a wide variety of private label branding for the past 35 years, but the brands have lacked consistency in name, appearance, etc. Research shows a low level of consumer loyalty to the existing private label products, so the retailer is prepared to remove them if a new program that you develop is successful.

The prior pricing strategy on all private label products has been to use a price of 10% below the price of the category leader. This helped generate slightly less than twice the profit per package versus the higher priced national brand.

All existing store brands are capable of achieving an ‘average’ quality rating by consumers. This is acceptable to the retailer, so no change in product content is needed in this project.

The regional retailer wants the new program introduced in a few select categories that are most likely to be accepted by the consumer. Secondary product introductions would result about every 3-4 months in other categories that face higher levels of competition and/or consumer switching resistance. It is estimated that it would take 5 years to get all of the hundreds of private store brands changed.

1. Propose a single brand name or a variety of names for different product categories.
2. Propose 5 to 10 product categories that should be initially introduced
3. Propose a low-cost advertising/promotion/merchandising communication program to support this new program that begins with limited category coverage. 
4. Propose a pricing program relative to the average price of the category leader. Explain the reasoning for the pricing plan.

Tim is a real estate broker who specializes in commercial real estate.Although he usually buys and sells on behalf of others, he also maintains a portfolio ofproperty of his own. He holds this property, mainly unimproved land, either as aninvestment or for sale to others.In early 2011, Irene and Al contact Tim regarding a tract of land located just outsidethe city limits. Tim bought the property, which is known as the Moore farm, several yearsago for $600,000. At that time, no one knew that it was located on a geological fault line.Irene, a well-known architect, and Al, a building contractor, want Tim to join them indeveloping the property for residential use. They are aware of the fault line but believethat they can circumvent the problem by using newly developed design and constructiontechnology. Because of the geological flaw, however, they regard the Moore farm as beingworth only $450,000. Their intent is to organize a corporation to build the housing project,and each party will receive stock commensurate to the property or services contributed.After consulting his tax adviser, Tim agrees to join the venture if certain modificationsto the proposed arrangement are made. The transfer of the land would be structured asa sale to the corporation. Instead of receiving stock, Tim would receive a note from thecorporation. The note would be interest-bearing and due in five years. The maturity valueof the note would be $450,000the amount that even Tim concedes is the fair marketvalue of the Moore farm.What income tax consequences ensue from Tim’s suggested approach? Compare thisresult with what would happen if Tim merely transferred the Moore farm in return forstock in the new corporation.