Measuring market orientation of Muscle Pharm Corp. (MSLP:US) May 2014 | Page 7

Equity Research - Company Valuation: Diamondcorp PLC

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ASSESSMENT OFTHE OVER-RIDING ORIENTATION

This chapter will assess the orientation of MSLP against each of the orientations product/production-/sales/- market-oriented and will conclude with what the dominant orientation
of MSLP is.

2.1 PRODUCT VS PRODUCTION ORIENTATION
Kokenmuller (2013) describes production orientation as an approach that sets the
concentration on its manufacturing and production processes. This includes an initial focus
on improving operational efficiency, optimization of its work-flows and benefits from
economies of scale. Due to the fact, that the major focus is set on processes of production,
the efforts into packaging and marketing are usually weak and will not support to drive
demand trough marketing achievements.
Product orientation on the other hand is when the firm is concerned with the product
quality. Product orientated firms are characterized by the managers obsession for their
products and the belief that their products are exclusive and offer an apparent advantage.
The firms are concentrating on continuous advancement of the product as they think that an
outstanding product will sell itself very effectively (Kokemuller, 2013).
MSLP does not own any manufacturing facilities and has outsourced its whole production to
manufacturers in order to be flexible in terms of volume (Sheldon, 2014). However, recently
MSLP announced a strategic deal to buy BioZone Pharmaceuticals, Inc. which is a contract
producer for over-the-counter products that range from cosmetics to drugs and nutritional
supplements. MSLP states that it seeks to develop its own production through vertical
integration of manufacturing with the aim to improve profitability and increase margins
(ACP, 2014). Due to this fact, the current production orientation of MSLP is very low with
the intention to become increasingly production orientated and benefit from economies of
scale for the longer term.
MSLP states that they were able to gain the faith of millions of clients by offering the best
nutritional supplements on the market. Taking a look to company structure, it is evident that
the research and development of its products is backed by a scientific team consisting more
than 20 scientists, pharmacists and doctor which conducts in-house clinical trials on its
35.000sq. ft. Sports Science Institute and recently launched a new iconic sub-brand named
the Arnold Schwarzenegger™ series to the market and a new sub-brand for a new market
(women) called FitMiss™ (Sheldon, 2014). Consequently, the team sets its major focus to
produce high quality and safe supplements which underpins the strong product orientation
of MSLP.

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