InThinking Business Management
Exam Practice Question – The Female Company
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The Female Company (TFC)
The Female Company (TFC) is a female healthcare product business that specializes in
delivering organic cotton tampons, with no harmful chemicals or pesticides, straight to their
customers. It business was established by co-founders Ann-Sophie Claus, the Managing
Director and Chief Executive Officer (CEO) and Sinja Stadelmaier, the Managing Director
and Chief Product Officer (CPO) in 2018. TFC is as a privately held company and is
based in Berlin, Germany. The company employs 33 workers.
(a) Define the term privately held company. [2 marks]
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As a start-up company in 2018, TFC relied on both internal and external sources of
finance. The company received financial backing from numerous business angels. TFC
also managed to secure €42,200 in crowdfunding.
(b) In the context of the case study, distinguish between business angels and
crowdfunding. [4 marks]
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Exam Practice Question – The Female Company
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TFC provides sustainable and well-designed products for modern women. The company
protests against what it regards to be an unfair tax on feminine hygiene products in
Germany, where these products are considered luxury goods. This means tampons and
sanitary pads are taxed at 19%, like flowers, truffles, or oil paintings.
TFC believes tampons are essential items and should be taxed at the lower rate of 7%.
The co-founders, who met at university, came up with a creative solution to this problem
by packaging tampons inside a book to qualify for the lower tax rate. This ingenious
approach has become TFC’s unique selling point.
(c) Explain two reasons why having a unique selling point is important to TFC. [4 marks]
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The first print-run of The Tampon Book in the spring of 2019 sold out in a single day. The
book which contains, 15 tampons and pages of fun and surprising information about
menstruation, is priced at €3.11 ($3.30). The company also offers an online subscription
scheme, meaning women always have access to them when needed.
TFC’s market research revealed the following:
Tampon manufacturers are not required by law to show the ingredients of their
products on their packaging, such as plastics.
Many women in Germany and around the world are unable to afford sanitary products.
Increasing awareness about feminine hygiene has contributed to changing lifestyle of
women on a global scale, so is expected to increase the market for the tampons.
The German government has since abolished the tampon tax.
Source: adapted from The Female Company
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InThinking Business Management
Exam Practice Question – The Female Company
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Consumers in Germany and across the globe are increasingly demanding hygiene
products that are environmentally friendly and sustainable. For example, there has been a
surge in the demand for organic and biodegradable tampons and sanitary pads. TFC’s
organic cotton tampons are 98.4% compostable and the company has replaced plastics in
sanitary pads with organic maize starch. The tampons are packed in paper instead of
plastic wrapping, which dramatically reduces the amount of waste materials that end up in
landfills.
Some of the challenges that TFC currently faces include:
Stigma and taboo around female health, including menstruation and menopause, in
many parts of the world can hinder awareness and education about TFC's products
and female health.
As a small company, TFC needs to effectively manage its logistics and supply chain
to meet the demands of its customers and subscribers, as well as maintain high
levels of customer satisfaction.
Marketing – With a limited marketing budget, TFC needs to continually find creative
ways to reach more customers. The company does not have a global presence.
Competition – There are at least 30 other companies that offer similar products, so
TFC needs to continuously innovate and differentiate itself to remain competitive.
The tampon market was valued at $4.19bn in 2020 and expected to grow by almost 70%
to over $7bn by 2027. Tampax, owned by US multinational Procter & Gamble (P&G), is
the undisputed market leader with 29% global market share. P&G’s closest competitor,
Johnson & Johnson, has less than 20% market share. Each year, the company sells more
than 4.5 billion boxes of Tampax worldwide (that’s 513,698 boxes sold per hour!) Tampax
was launched in 1931 and has dominated the market for decades. However, Tampax is
not sold in retail outlets in Germany. The most popular brand for feminine care products in
Germany, such as tampons and sanitary pads, is o.b., with 22.5% of women using o.b.
products.
Sources: adapted from The Female Company and The Guardian
Table 1 – Best tampons of 2023, according to scientists and gynecologists
Price per
Rank Brand
tampon
1. Tampax Pure Organic Tampons $0.50
2. Tampax Pearl Tampons $0.22
3. Seventh Generation Organic Cotton Tampons $0.39
4. Tampax Radiant Tampons $0.25
5. Playtex Sport Tampons $0.20
Source: Good Housekeeping
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Exam Practice Question – The Female Company
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(d) Using the data provided in Table 1 and information in the stimulus, recommend a
suitable marketing mix for TFC to increase its market share. [10 marks]
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InThinking Business Management
Exam Practice Question – The Female Company
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Mark scheme
(a) Define the term privately held company. [2 marks]
A privately held company is a business organization that is owned and operated by private
investors or shareholders without its shares being openly traded on a Stock Exchange.
The majority of shares are typically held by a small group of individuals, such as family and
friends. The owners (shareholders) have full control of the organization’s operations,
including all decisions that need to be made.
Candidates are not expected to word their definition exactly as above.
Award [1 mark] for a definition that shows some understanding of the term privately held
company.
Award [2 marks] for definition that shows a clear and accurate understanding of the term
privately held company, similar to example above.
(b) In the context of the case study, distinguish between business angels and
crowdfunding. [4 marks]
Business angels are wealthy individual investors who provide capital to support start-up
companies in exchange for equity (a share in the company) or debt (as a loan with interest
charges). They usually have a personal interest in the target company and will usually
have prior experience in the industry, so often also provide business advice to support
start-up entrepreneurs.
In contrast, crowdfunding is a form of finance where a large number of people make small
contributions to fund a project or business venture, usually through an online platform.
Unlike business angels, crowdfunding contributors do not typically take any ownership or
stake in the start-up company or business venture. Instead, they often receive rewards in
the form of free or discounted products or services. Crowdfunding is often used to raise
funds for creative projects, such as TFC’s project to make female hygiene products more
affordable to consumers in Germany and beyond.
Award [1 – 2 marks] for an answer that shows some knowledge of business angels and
crowdfunding at a generic, theoretical level.
Award [3 – 4 marks] for an answer that fully and clearly distinguishes between business
angels and crowdfunding with reference to the case study.
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InThinking Business Management
Exam Practice Question – The Female Company
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(c) Explain two reasons why having a unique selling point (USP) is important to TFC.
[4 marks]
Having a unique selling point (USP) can be extremely important for TFC in order to stand
out from the intense competition in the industry and to attract more customers. TFC’s USP
has been its creative solution to the problem of tampons being classified as luxury goods
and taxed at 19% in Germany. By packaging the tampons inside a book, TFC was able to
qualify for the lower tax rate of 7%. This ingenious approach has become a major selling
point for TFC and is likely to attract customers who are looking for an ethical and
sustainable product that is also cost-effective.
In addition to the cost savings, TFC’s USP also has the benefit of providing customers with
a sense of corporate social responsibility (CSR). By supporting TFC and buying their
products, customers are helping to fight against the perceived unfair tax on feminine
hygiene products. This resonates well with customers who are not only looking for a
product that is of good quality but also serves a moral and ethical purpose. Ultimately, this
USP allows TFC to differentiate itself from competitors in the market.
Mark as 2+2
Award [1 mark] for identification of a relevant point of importance and an additional [1
mark]
for a suitable explanation and application to TFC, up to a maximum of [2 marks] per
reason.
(d) Using the data provided in Table 1 and information in the stimulus,
recommend a suitable marketing mix for TFC to increase its market share. [10
marks]
Possible aspects of the marketing mix that TFC could use as part of its strategy to
increase market share could include a discussion about the following points:
Product: TFC could emphasize its unique selling point of providing organic cotton
tampons with no harmful chemicals or pesticides, packed in paper instead of plastic
wrapping. This can help to differentiate its products from some of the competitors and
emphasize TFC’s commitment to environmental sustainability, which will appeal to the
consumers who are increasingly demanding hygiene products that are environmentally
friendly and sustainable.
Price: TFC’s price per tampon is competitive with other leading brands (Table 1) although
this is not necessarily advertised or promoted very well. TFC could consider advertising
the price per tampon ($0.22) being one of the lowest available (Table 1). It might even
consider reducing the price a little, given that the German government has abolished the
sales tax on tampons, to match the price of Playtex Sport Tampons ($0.20 per tampon).
This could make TFC’s tampons even more attractive to customers. Alternatively, TFC’s
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Exam Practice Question – The Female Company
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subscription service could provide opportunities for the company to provide discounted
prices for loyal members.
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Exam Practice Question – The Female Company
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Promotion: TFC’s USP is a great way to promote the company and its mission. Finding
further opportunities to share its story with potential customers and the media can help the
relatively new company to build brand awareness, brand recognition, and brand loyalty in
order to increase its market share. However, TFC has a limited marketing budget, so is
likely to rely on the use of below-the-line promotional strategies. For example, TFC could
make better use of social media marketing to promote the company, its products, and
success in pushing for social justice, such as creating targeted ads and campaigns, or
even influencer marketing, to reach more potential customers and to raise awareness of
TFC’s products.
Place: To increase its market share, TFC could focus on expanding its presence in
different countries and markets, especially in the European Union. This could involve
targeting specific countries or regions and partnering with other retailers, such as
supermarkets, to expand its reach. TFC could also consider expanding into online
platforms, such as Amazon, to reach more customers. Although using an intermediary
such as Amazon, sales revenues are likely to increase over time, which could increase
overall profits and market share for TFC in the long term. With the rise of e-commerce,
more customers are buying hygiene products online and the trend is expected to continue
as people become more comfortable with online shopping.
People: TFC could also focus on recruiting and training a team of knowledgeable and
enthusiastic employees who can provide excellent customer service and further improve
customer relations. This can help the company to create a positive customer experience
and build customer loyalty. Additionally, TFC should ensure its 33 employees are well
trained in product knowledge and have a good understanding of the company’s values and
mission. This helps to build consumer confidence and strengthen customer loyalty, thereby
helping to increase TFC’s market share.
TFC could also consider investing in market research to ensure its products remain
competitive and its marketing is up to date with customer needs and preferences. This
would ultimately help to improve the company’s marketing mix. For example, TFC could
conduct regular surveys and focus groups with its customers to gain valuable insights into
the customer experience and to identify any new areas for improvement. Additionally, TFC
should consider using new but affordable management information systems (MIS) to
monitor customer data and to track customer trends and preferences. This information can
then be used to continuously improve the company’s marketing, female hygiene products,
and customer services – all of which can help to improve the company’s market share.
Accept any other relevant argument written in the context of the case study.
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InThinking Business Management
Exam Practice Question – The Female Company
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Note that for the top mark band, candidates must provide some acknowledgement of the
limitations of the data or information in the stimulus material. For example, table one only
shows the top five tampon brands based on one particular survey, and it is not known
whether TFC may have a higher ranking in Germany, its home country. Furthermore, there
is limited information about the company’s finances. If TFC has inadequate funds raised
through business angels and crowdfunding, it might be difficult for the company to change
its marketing mix and compete effectively with the more established rivals. In particular,
being a small company compared to the likes of Procter and Gamble, TFC may well
struggle to improve its market share by any significant measure.
Award [1 – 2 marks] for an answer that shows little understanding of the demands of the
question. There is minimal use of business management tools and theories, or these are
irrelevant or used inaccurately. There is little or no reference to the stimulus material.
Award [3 – 4 marks] for an answer that shows some understanding of the demands of the
question. There is some use of appropriate business management tools and theories, but
these are mostly lacking in accuracy and relevance. There is superficial use of information
from the stimulus material, often not going beyond the name of The Female Company.
Any arguments made are generally unsubstantiated.
Award [5 – 6 marks] for an answer that shows an understanding of the demands of the
question, but these demands are only partly addressed. There is some relevant and
accurate use of business management tools and theories. There is some relevant use of
information from the stimulus material that goes beyond the name of The Female
Company. The arguments are substantiated but are mainly one-sided.
Award [7 – 8 marks] for an answer that addresses most of the demands of the question.
On the whole, there is mainly relevant and accurate use of business management tools
and theories. Information from the stimulus material is generally used appropriately to
support the arguments, although there is some lack of clarity or relevance in some places.
The arguments are substantiated, and the answer provides some balance.
Award [9 – 10 marks] for an answer that shows clear focus on addressing the demands of
the question. There is relevant and accurate use of business management tools and
theories throughout the response. Relevant information from the stimulus material is
integrated effectively to support the arguments. The arguments are substantiated and
balanced, with an explanation of the limitations of the case study or stimulus material.
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