Lauren BakerCiera BallmerMaryjane BehmAllie BreunigKristen BroegeNatalie EndresSydney EndresJordan GaalSara GriswoldMolly HendricksonSarah Krier

Megan LauberMariah MartinEmily MatzkeNicole NehlsEmma OlstadNicole PralleZackary PropstKavya RathiJordan RippMcKenzie Rowley

Josie Russo Elizabeth SarbackerNick TroiolaKeisha VerbetenDakotah WalkerIzak WalkerSavannah WallerAlison WedigJessica WendtTaylre WilkeAdvisor: Sarah Botham

University of Wisconsin-Madison2017 Executive Summary

Presented by:

Ginseng Energy Bar

SIMPLY UPROOTEDTM

Market AnalysisMarket Trends• Research indicates that 35 percent of consumers snack for

energy.4• The consumption of energy snacks is increasing, driven by

health-conscious consumers who desire nutritious food products to maintain healthy lifestyles.5

• Those who frequently consume nutrition bars are 8 percent more likely to try new foods and engage in outdoor pursuits such as rock climbing, backpacking and mountain biking.6

• There is room for market growth for energy bar products that require less processing, contain less sugar and include ingredients that provide a long-lasting energy boost.7

• The overall market for snack bars is projected to approach $8 billion in 2019; cumulative growth of 30 percent from 2014.8

• Forty-eight percent of adults replace meals with snacks three to four times per week and 90 percent of consumers snack multiple times throughout the day.9

• Millennials are willing to spend more for products that are enviornmentally friendly. 10

• Generation X and millennials look for foods and ingredients that deliver health benefits like more energy and better sleep.11

IntroductionGinseng, a staple in traditional Chinese medicine and culture for thousands of years, is a slow-growing, perennial plant with fibrous roots. Ginseng boasts several health benefits, including increased energy.1 Ginseng is typically sold as a component in health supplements, including in tea cut and whole root form.

Today, Central Wisconsin is home to the country’s largest ginseng-producing region. Wisconsin ginseng has the unique distinction of containing high levels of ginsenosides, which give ginseng its desired flavor.2 Ninety-five percent of ginseng produced in the United States is grown in Wisconsin, however, the majority is exported to Asia.3 While growers enjoy market domination in Asia, overproduction has created an excess supply in Wisconsin warehouses. This has generated little income and resulted in storage costs as held inventory. Until now. With the power of ginseng as its defining attribute, Simply UpRootedTM energy bar breaks into the nutrient-rich, protein-packed, power food market with five simple ingredients. The fine-cut ginseng will complement the chewy bar’s simple ingredients of buckwheat, peanut butter, maple syrup and oats. Differentiated from the competition by its ginseng-powered energy and compostable packaging, it will initially be available in a six-bar multi-pack and later, as single bars. Break-Apart-Bar™ perforation technology is used to create an easy-to-break, bite-sized snack.

Simply UpRooted is produced and distributed through Nekoosa Foods. Founded in 1969 in Central Wisconsin, Nekoosa Foods produces and distributes a line of simple-ingredient cereals. They are Simply Bran™, Simply Oat™ and Simply Rice™ and are favored by health-conscious consumers in Wisconsin and select Midwestern and Western states. With opportunity available in the energy bar category, Simply UpRooted can capture market share while offering a delicious, nutritious and energy-dense option. Nekoosa Foods will employ its in-house marketing team to launch the Power the Journey™ campaign to bring additional value to Wisconsin ginseng producers while raising consumer awareness and driving sales.

• Architect earning $60,000 annually• Participates in mountain climbing and

competitive mountain biking12

• Appreciates food transparency, foods high in protein and compostable packaging11

• Two young children• Natalie is an engineer and Nate is a part-time

interior designer and stay-at-home dad; annual household income of $175,000

• Travel to state and national parks for vacation 14

• Shop for food at natural food cooperatives11 and look for foods and ingredients that deliver health benefits like more energy and better sleep15

Consumer Profiles

Adventure Alex - age 24, single

Nature Nate & Natalie - age 45, married

CrossFit Carrie - age 26, single• Software Developer earning $95,000 annually• Engages in CrossFit training five days a week• Looks for food that provides energy and nutrition13

• Shares health journey and follows fitness influencers on social media

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Sources: 1. Ginseng Fights Fatigue in Cancer Patients, Mayo Clinic, 2012: http://mayocl.in/2nwPlOM. 2. Ginseng Board of Wiscon-sin:http://www.ginsengboard.com/. 3. Ginseng Board of Wis., Dept. of Agriculture, Trade and Consumer Protection: http://bit.ly/2nhTi84. 4. Better for You Snacks U.S., Mintel Report, 2016. 5. Global Cereal Bars Market 2016-2020, TechNavio: http://bit.ly/2nBcWiK. 6. Nutritional Bars Provide Match Healthy, Prepared Foods: http://bit.ly/2nhWGA6. 7. Nutrition and Energy Bars U.S., Mintel Report, 2012. 8. U.S. Nutritional and Cereal Bar Trends, Prepared Foods: http://bit.ly/2n4pbEG. 9. U.S. Grocery Shopper Trends, Food Marketing Insti-tute, 2015. 10. Green Generation, Nielsen, 2015: http://bit.ly/1NU3dJJ. 11. Gen X Food Preferences, Gordon: http://bit.ly/2nwWC14. 12. Action and Extreme Sports U.S., Mintel Report, 2011. 13. Peformance Food and Drink U.S., Mintel Report, 2013. 14. Adventure Tourism Market Report, George Washington University, 2010. 15. Snacking Motivations and Attitudes U.S., Mintel Report, 2015.

Market SizeThe primary target audience for Simply UpRooted™ consists of consumers between the ages of 18 and 26 in Wisconsin and Colorado. There are nearly 1.4 million consumers in this target audience. This group purchases specialty snacks such as Simply UpRooted energy bars, for adventure travel trips.14 Primary research indicates that consumers favor environmentally friendly packaging.16

The secondary audience for Simply UpRooted is individuals between the ages of 35 and 55 in the same target states. There are more than 3 million consumers in this target audience. These consumers prefer transparent, functional foods that are protein-packed and energy-dense.13

Market PotentialMarket research indicates a strong potential for an energy-dense snack bar. Sales of better-for-you (BFY) snacks hit $1.1 billion in 2016, a 35 percent gain since 2014.4 According to a recent survey by the Adventure Travel Trade Association, 26 percent of respondents indicated that they participated in adventure travel activities. The same survery indicated that those who engage in outdoor activites are also more likely to consume nutrition bars. Adventure travelers spend generously on pre-trip supplies, including food, justifying the potential for a premium-priced energy bar for adventurers.14

Need for ProductSimply UpRooted will appeal to Generation X and younger millennials who desire a quick snack that provides long-lasting energy. 15 Consumers in these demographics also appreciate products made with simple ingredients.11

Competitive AnalysisTo differentiate in a saturated energy bar market, Simply UpRooted energy bars contain ginseng and are packaged in a unique, compostable multi-pack. Additionally the bars are produced using the Break-Apart-Bar™ patented perforation technology to allow for quick, convenient snacking.

Energy Bar Market Simply UpRooted enters the U.S. energy bar market as the only ginseng-powered bar. Direct competitors include energy bars like Clif Bar, Nature Valley Protein Chewy Bar, LÄRABAR and KIND bar. Nekoosa Foods’ focus group research confirms that the primary target audience prefers minimal packaging and multi-pack options.16 Simply UpRooted’s compostable packaging, perforated bars and long-lasting energy appeal to the target consumers, and justify its premium price.

Granola BitesBreak-Apart-Bar technology gives Simply UpRooted the flexibility of bite-sized portions in the convenience of a bar, creating an easy and versatile snack option. Simply UpRooted’s indirect competitors include Bear Naked Granola Bites, Nature Valley Granola Bites and Special K Granola Bites. Focus group research confirms that versatility in portion size and multi-pack options are preferred.16

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• Health and energy benefits• Abundant supply and long shelf life of ginseng• Compostable multi-pack • Convenient bite-sized perforations• Parent company credibility ST

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• Premium price• Low product awareness• Misconceptions about ginseng as a food ingredient

• Increasing demand for healthy snacks• Raise awareness of the ginseng industry• Establish ginseng as a mainstream ingredient

• Emergence of shadow products• Unpredictable weather and natural disasters• Entering the highly saturated energy bar market

WEAKNESSES

THREATS

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Sources: 16. Nekoosa Foods Survey Results.

0g Ginseng9g Protein21g Sugar7g Fat$5.87/multi-pack

0g Ginseng3g Protein7g Sugar5g Fat$3.59/multi-packSIMPLY

UPROOTEDTM

2g Ginseng12.5g Protein2.25g Sugar8g Fat$9.49/multi-pack

Business PropositionStrategy StatementSimply UpRooted energy bars provide nutrient-rich, ginseng-powered energy in compostable multi-pack and single-serving options. Capitalizing on Wisconsin’s unparalleled ginseng tradition, Simply UpRooted brings product diversification to the ginseng market and added value to growers.

Goals 1. Achieve 15 percent brand awareness within the

collective target market; 10 percent aided and 5 percent unaided

2. Secure 1 percent market share within the energy bar market and 1 percent share in the better-for-you-snacks market in the target regions

3. Net profit meets or exceeds $1.4 million

SWOT ANALYSIS

Action PlanProductAs the only nutrient-rich, ginseng-powered energy bar, Simply UpRooted will be introduced in a signature, chewy peanut butter-maple flavor comprised of five simple ingredients: ginseng, maple syrup, oats, buckwheat and peanut butter. Simply UpRooted will be available in a six-bar compostable, resealable and collapsible package that travels well in any adventurer’s gear. In year two, convenient single-bar packaging will be introduced.

Placement Simply UpRooted conducted an online test launch in March 2017 and held promotional events at Recreational Equipment, Inc. (REI) retailers in Madison, Wis. and Denver.

In June 2017, Simply UpRooted will formally launch at the GoPro Mountain Games in Vail, Colo., targeting the early adopters and influencers in the adventure market. Correspondingly, in June 2017 the six-bar multi-pack will reach retail shelves of 35 Kroger network stores in populous Wisconsin and Colorado cities and all 10 REI retailers as well as eight natural food cooperatives in select cities in these states. Similarly, Simply Uprooted will reach another portion of the target audience with a presence at the August 2017 Reebok CrossFit Games in Madison, Wis.

In year two, Simply UpRooted will introduce single-bar packages in established retailers in Wisconsin and Colorado. Simply UpRooted multi-packs will also be introduced into 30 additional Kroger network stores throughout Colorado.

In year three, Simply UpRooted will expand into 12 Hy-Vee stores and eight natural food cooperatives in the greater Minneapolis area. Thirteen Kroger network stores and two natural food co-ops in the Salt Lake City area will also carry the multi-pack product. Further expansion includes four REI retailers in Utah and three in Minnesota.

To draw attention to Simply UpRooted and engage shoppers in crowded nutrition and health aisles, a creative point of purchase (POP) display will be placed in select retail locations. This strategy will begin in year one and will continue in the following expansion years.

Assumptions1. Simply UpRooted™ is a Nekoosa Foods cereal products brand extension and has established relationships with retailers and distributors. In

addition, Nekoosa Foods has access to shelf space within the Kroger and Hy-Vee grocery networks.2. Simply UpRooted energy bars are ready for sale and consumption and are taste tested and approved by consumer focus groups and nutritionists. 3. Nekoosa Foods has an established relationship with ginseng producers in Central Wisconsin who have collectively agreed to a three-year

partnership with the Simply UpRooted brand.4. The average ginseng serving size is two grams and does not require daily consumption to obtain the full health benefits.5. Nekoosa Foods owns the patented Break-Apart-Bar™ perforation technology used in the production of Simply UpRooted energy bars.

maple-peanut butter energy bars

Natural energy fueled by Wisconsin ginseng

Perforated for easy snacking100% compostable packaging NET W. 13.5 oz (388 g)

Power the journey

6 Bars

SIMPLY UPROOTED

TM

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Multi-Pack Co-ops

3 Multi-Pack Co-ops

Multi-Pack Individual Co-ops

Patented Break-Apart-BarTM TechnologySimply UpRooted’s patented Break-Apart-Bar perforation technology allows for a single energy bar with six bite-sized, break-off pieces.

Promotion: Power the JourneyTM

The Power the Journey campaign will launch Simply UpRooted™ into the marketplace with the tagline Power the Journey. This campaign will employ three initiatives that generate consumer interest by featuring ginseng and its natural, long-lasting energy. These three initiatives are:

1. Experience GinsengTM

The Ginseng Jeep will journey as a mobile advertisement to educate consumers about ginseng production and its natural energy. Through national and state parks and outdoor events, brand ambassadors will distribute samples and logo stickers and bring the PowerUp Exchange™ program to life across the market. Through this program, customers will be encouraged to exchange competitor products for a Simply UpRooted energy bar at select events in each launch year. The energy bars that are exchanged will be donated to local food pantries.

2. Journey with GinsengTM The Journey with Ginseng initiative engages consumers through Instagram, Facebook and Snapchat social media channels using the branded #JourneyWithGinseng. Consumers are encouraged to highlight their adventures and demonstrate how Simply UpRooted fuels their journey to an active lifestyle. Inbound and outbound strategies will bring these campaigns to life. Additionally, working with influencers and bloggers will add fresh content and attract followers to Simply UpRooted social media channels, driving brand awareness and trial.

3. Caring for Our RootsTM At the end of year one, the Simply UpRooted brand will initiate its Caring for Our Roots support program for national and state parks. This initiative allocates 0.5 percent of sales to national and state parks in target states to sponsor established educational composting programs. The Simply UpRooted website and social media channels will promote this program and aid in education and outreach.

PersonnelOne brand manager will collaborate with the Nekoosa Foods marketing team to manage all Simply UpRooted launches, sales and promotional events. Two brand ambassadors will manage events, in-store demonstrations and collect consumer-satisfaction surveys.

Earned Media and Public RelationsSharing the Simply UpRooted Wisconsin ginseng story will give root to the health and lifestyle connection to the brand. Strategic earned media initiatives in key channels will tell the Simply UpRooted ginseng story and broaden exposure about the three strategic initiatives to markets in each launch region.

Digital MarketingThe Simply UpRooted website will feature e-commerce access as well as information about the Caring for Our Roots program. The website blog will share stories from brand-evangelist adventure seekers, highlighting the ways that Simply UpRooted helps fuel their adventures. The website will further provide educational information about ginseng’s energy and health benefits and feature a tracker for the Ginseng Jeep journey. An interactive map will identify the origin of each simple ingredient in the product.

SamplesSimply UpRooted will be scheduled for in-store sampling during peak hours in select retail locations. Additionally, the Ginseng Jeep will journey to the International Wisconsin Ginseng Festival, Reebok CrossFit Games, GoPro Mountain Games, REI Outdoor School events, REI retailers, natural food cooperatives and grocery stores, to distribute samples throughout the three launch years.

Paid AdvertisingSimply UpRooted energy bars will be placed in participant registration bags at the Reebok CrossFit Games and GoPro Mountain Games. Ads will be featured in magazines such as Colorado Life, Elevation Outdoors and Adventure Outdoors. Digital advertisements will also be placed on Facebook, Instagram, Spotify, Pandora and in Wisconsin Trails, an online publication.

Trade ShowsBeginning in year two, Simply UpRooted will exhibit at select trade shows such as the Healthy Life Expo in Minneapolis, to broaden product awareness, attract retailers and promote sales. In year three, Simply UpRooted will exhibit at the Sweets and Snacks Expo in Chicago and the Natural Products Expo in Anaheim, Calif.

Awards and SupportSimply UpRooted will compete for a DuPont Award for Packaging Innovation and a Sweets and Snacks Expo Most Innovative New Product Award. Leveraging these accolades adds credibility to the product story, enhancing sales and generating earned media opportunities, new retailer relationships and consumer interest.

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POWER THE JOURNEY

simplyuprooted.com

GNSNG

#journeywithginseng

$2.49

$9.49

$5.12

$1.34

Six-Bar Multi-Pack

Single-Bar Package

= Wholesale = Suggested Retail

$1.00

$10.00

$9.00

$8.00

$7.00

$6.00

$5.00

$4.00

$3.00

$2.00

= Distributer

$1.74

$6.66

Monitoring & Measuring

Three-Step Crisis Plan

FinancialsNekoosa Foods sources all five ingredients for Simply UpRooted™ from Midwestern distributors, featuring Wisconsin tea cut ginseng at $70 per pound. Research confirms that 1.1 acres producing 14 barrels of ginseng will be the aggregate need by year three to meet sales projections. This provides Wisconsin ginseng growers an additional $132,300 in revenue by the end of year three. The five ingredients and compostable packaging contribute to a cost of goods sold of $0.54 per bar and $2.56 for the six-bar multi-pack. This results in a final suggested retail price of $2.49 and $9.49 for a single bar and multi-pack respectively. These prices account for distributor- and retailer margins of 30- and 42 percent.

Year one will result in a net loss due to a large investment in marketing expenses. This investment is justified through marketing and brand awareness efforts and increasing sales in years two and three. By the end of year three, Simply UpRooted will generate a conservative gross margin of 32.35 percent, while producing a net profit of $1,474,542.54.

Recall product

Compensate consumers

Clean facilities

Crisis hotline→ → +

Marketing Expenses Year 1 Year 2 Year 3 National Park Compost Education Fund

$1,980.22 $9,123.25 $22,791.22

REI Promotion $10,000 $20,000 $25,000

Energy Bar Trade-In Samples $3,960.44 $18,246.49 $45,582.45

POP Displays $16,500 $25,500 $39,000

Ginseng Jeep Campaign $60,516.83 $22,755.83 $23,011.66

GoPro Mountain Games & Reebok CrossFit Games Samples

$20,590 $20,590 $20,590

Brand Manager $85,000 $89,250 $93,712.50

Brand Ambassadors $92,250 $94,500 $96,390

Trade Shows & Ginseng Festival --- $40,695 $45,745

Website Development & Maintenence

$22,000 $15,000 $15,000

Slotting Fees $50,000 $100,000 $200,000

Paid Online Advertising $20,000 $30,000 $40,000

In-Store Kiosk & Samples $2,980.22 $10,123.25 $23,791.22

Print Advertising $30,930 $41,040 $50,600

Monitoring & Measuring $15,000 $20,000 $20,000

Total Marketing Expenses $431,707.70 $556,823.82 $761,214.05

Income Statement Year 1 Year 2 Year 3

SalesIndividual 2.25-ounce bars --- $95,925.80 $443,075.77

13.5-ounce multi-pack $392,122.45 $1,692,946.21 $3,982,404.49

Online Sales $3,921.22 $35,777.44 $132,764.41

Net Sales $396,043.67 $1,824,649.44 $4,558,244.66

COGSGinseng $159,557.85 $713,730.56 $1,735,285.40

Oats $4,197.94 $18,778.15 $45,655.11

Maple syrup $3,287.40 $14,705.12 $35,752.39

Buckwheat $1,531.76 $6,851.81 $16,658.74

Peanut butter $9,190.37 $41,110.16 $99,950.68

Production Expenses $64,095 $154,724.82 $319,185.74

Total COGS $241,860.05 $949,900.61 $2,252,488.06

Gross Profit $154,183.62 $874,748.84 $2,305,756.60

Operating ExpensesProcurement specialist $35,000 $35,000 $35,000

Operations manager $35,000 $35,000 $35,000

Total Operating Expenses $70,000 $70,000 $70,000

Total Marketing Expenses $431,707.70 $556,823.82 $761,214.05

Total Expenses $501,707.70 $626,823.82 $831,214.05

Net Profit/Loss Before Taxes ($347,524.08) $247,925.02 $1,474,542.54

Percent Profit (87.75%) 13.59% 32.35%

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Measurement Tools1. Brand Awareness - Little Bird, Keyhole, Google Analytics,

qualitative and quantitative online surveys2. Market Share - Quarterly market share reports; track

energy bar market trends3. Profit - Monthly, quarterly and yearly sales reports

More than Expected:

Brand Awareness - New retailer relationships, develop relationships with grower to buy product after surplus, Amazon Pantry and airportsMarket Share - Branch into new flavors, partner with yogurt company and enhance research and development effortsProfit - Introduce bulk packaging and expand into Idaho, Northern California, Oregon and Washington

Brand Awareness - Increase product education and revise core ginseng-energy messagesMarket Share - Re-evaluate cross-channel marketing and consider coupon strategyProfit - Review pricing strategy, packaging strategy and sizes

Less than Expected:

Contingencies