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Strategies & Market Trends : The GUMMMy Bear Squad touting Gum Tech (NASDAQ: GUMM) -- Ignore unavailable to you. Want to Upgrade?

To: Mad2 who wrote (117)	2/2/2000 2:01:00 PM
From: Carl R.	Read Replies (1) \| Respond to of 207

Mad2, let me say that I am not privy to the traditional selling pattern for cold remedies, but I suspect that you are largely correct that the normal pattern is heavy orders in the fall, followed by replacement orders through March, and then minimal orders through the summer. I don't believe that Zicam will follow this normal pattern for several reasons: 1. It wasn't released until November, so the early orders were non-existent. 2. They started with minimal distribution, and they are still entering new distribution points, so the shelf-stocking orders will continue into this quarter. 3. When it came out it was a new and untested product, so the stores that did order it probably ordered the minimum quantity. Thus once the product began to sell, they had to order larger quantities. 4. Consumer demand started at zero and has been ramping up. Thus the sell through rate today is presumably significantly higher now than in November, and consequently the stores will require a larger inventory. 5. No international distribution until this quarter. As a result I expect to see a different sales pattern with sales peaking this quarter instead of last quarter. I agree that sales will taper off over the summer months, and that the stock may taper off as well (or it may not), and then make an even bigger run next fall. One thing that may affect the size of the summer dip, if any, is if the big shorts decide that the product may be successful after all. I suspect they will wait until summer to cover, hoping for a dip, and if they cover the dip may be minimal. On the other hand, if a large competitor enters the field, that could lead to a much larger dip. Good luck, Carl