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The objective of this case study is to
examine four different pricing strategies
available to a procurement manager
from an Australian food manufacturer,
two of which involve the use of CBOT KC
(Kansas City) HRW (hard red winter)
wheat Options. The aim is to find a
pricing solution for the company which
will maintain its competitiveness at the
same time safeguarding product supply
and customer relationships.
A real company was used in the study
based on actual product procurement
and pricing decisions, but with the
company name changed to “Tortilla”.
The study includes the company profile,
an analysis of the situation and risks
involved, the four identified strategies,
the strategy outcomes based on actual
market conditions and a summary
discussion. A number of questions at
the end provide readers with practical
insights on other issues around the case.