WhatsApp 
American Chemical Corp Case Study Solution
American Chemical Corp Case Study Help
American Chemical Corp Case Study Analysis
The following area concentrates on the of marketing for American Chemical Corp where the business's consumers, rivals and core competencies have actually evaluated in order to justify whether the decision to introduce Case Study Help under American Chemical Corp brand name would be a possible choice or not. We have first of all looked at the kind of clients that American Chemical Corp handle while an evaluation of the competitive environment and the business's weak points and strengths follows. Embedded in the 3C analysis is the justification for not launching Case Study Help under American Chemical Corp name.
American Chemical Corp consumers can be segmented into two groups, commercial customers and final customers. Both the groups use American Chemical Corp high performance adhesives while the company is not only associated with the production of these adhesives but likewise markets them to these client groups. There are 2 types of products that are being offered to these prospective markets; anaerobic adhesives and immediate adhesives. We would be concentrating on the consumers of immediate adhesives for this analysis given that the market for the latter has a lower potential for American Chemical Corp compared to that of immediate adhesives.
The total market for immediate adhesives is approximately 890,000 in the US in 1978 which covers both client groups which have been identified earlier.If we take a look at a breakdown of American Chemical Corp prospective market or customer groups, we can see that the business offers to OEMs (Original Equipment Manufacturers), Do-it-Yourself customers, repair work and upgrading companies (MRO) and producers dealing in products made from leather, metal, wood and plastic. This variety in customers recommends that American Chemical Corp can target has different alternatives in terms of segmenting the marketplace for its new product specifically as each of these groups would be needing the exact same kind of item with respective modifications in packaging, demand or quantity. The customer is not price delicate or brand name conscious so releasing a low priced dispenser under American Chemical Corp name is not a recommended alternative.
American Chemical Corp is not just a producer of adhesives however takes pleasure in market management in the instant adhesive industry. The company has its own competent and qualified sales force which adds worth to sales by training the business's network of 250 distributors for assisting in the sale of adhesives.
Core skills are not limited to adhesive production only as American Chemical Corp likewise concentrates on making adhesive giving equipment to help with making use of its items. This double production method gives American Chemical Corp an edge over competitors since none of the competitors of giving equipment makes instant adhesives. Additionally, none of these rivals offers directly to the consumer either and uses suppliers for reaching out to customers. While we are taking a look at the strengths of American Chemical Corp, it is essential to highlight the company's weaknesses also.
Although the company's sales personnel is experienced in training distributors, the truth stays that the sales team is not trained in selling equipment so there is a possibility of relying heavily on distributors when promoting adhesive devices. It ought to likewise be noted that the distributors are showing unwillingness when it comes to selling equipment that needs maintenance which increases the difficulties of selling devices under a particular brand name.
The business has actually items intended at the high end of the market if we look at American Chemical Corp item line in adhesive equipment particularly. The possibility of sales cannibalization exists if American Chemical Corp offers Case Study Help under the exact same portfolio. Offered the reality that Case Study Help is priced lower than American Chemical Corp high-end product line, sales cannibalization would absolutely be impacting American Chemical Corp sales income if the adhesive devices is offered under the business's trademark name.
We can see sales cannibalization impacting American Chemical Corp 27A Pencil Applicator which is priced at $275. There is another possible hazard which could decrease American Chemical Corp income if Case Study Help is launched under the company's trademark name. The truth that $175000 has been invested in promoting SuperBonder recommends that it is not a good time for releasing a dispenser which can highlight the truth that SuperBonder can get logged and Case Study Help is the anti-clogging solution for the instant adhesive.
Furthermore, if we take a look at the market in general, the adhesives market does disappoint brand name orientation or price awareness which provides us 2 additional factors for not introducing a low priced item under the company's brand.
The competitive environment of American Chemical Corp would be studied via Porter's five forces analysis which would highlight the degree of competition in the market.
Bargaining Power of Buyer: The Bargaining power of the purchaser in this market is low particularly as the buyer has low knowledge about the product. While companies like American Chemical Corp have actually handled to train distributors relating to adhesives, the last customer depends on distributors. Approximately 72% of sales are made directly by manufacturers and distributors for immediate adhesives so the buyer has a low bargaining power.
Bargaining Power of Supplier: Offered the fact that the adhesive market is dominated by 3 players, it could be stated that the provider delights in a higher bargaining power compared to the purchaser. The reality remains that the supplier does not have much influence over the buyer at this point especially as the purchaser does not show brand name acknowledgment or price level of sensitivity. When it comes to the adhesive market while the manufacturer and the buyer do not have a significant control over the real sales, this indicates that the supplier has the greater power.
Threat of new entrants: The competitive environment with its low brand name loyalty and the ease of entry shown by foreign Japanese competitors in the immediate adhesive market shows that the market enables ease of entry. However, if we look at American Chemical Corp in particular, the company has double abilities in terms of being a manufacturer of immediate adhesives and adhesive dispensers. Prospective hazards in equipment dispensing market are low which shows the possibility of developing brand awareness in not only instant adhesives however likewise in dispensing adhesives as none of the industry gamers has managed to position itself in double capabilities.
Risk of Substitutes: The hazard of substitutes in the instantaneous adhesive market is low while the dispenser market in particular has alternatives like Glumetic suggestion applicators, built-in applicators, pencil applicators and sophisticated consoles. The truth stays that if American Chemical Corp presented Case Study Help, it would be indulging in sales cannibalization for its own products. (see appendix 1 for structure).
Despite the fact that our 3C analysis has given various reasons for not launching Case Study Help under American Chemical Corp name, we have a recommended marketing mix for Case Study Help offered below if American Chemical Corp chooses to proceed with the launch.
Product & Target Market: The target market picked for Case Study Help is 'Automobile services' for a number of reasons. There are presently 89257 facilities in this sector and a high usage of roughly 58900 pounds. is being utilized by 36.1 % of the marketplace. This market has an additional growth potential of 10.1% which may be a good enough specific niche market section for Case Study Help. Not just would a portable dispenser offer convenience to this specific market, the reality that the Do-it-Yourself market can also be targeted if a drinkable low priced adhesive is being sold for usage with SuperBonder. The product would be offered without the 'glumetic idea' and 'vari-drop' so that the consumer can choose whether he wants to choose either of the two accessories or not.
Price: The recommended price of Case Study Help has been kept at $175 to the end user whether it is sold through suppliers or through direct selling. A cost below $250 would not require approvals from the senior management in case a mechanic at a motor lorry upkeep shop requires to purchase the product on his own.
American Chemical Corp would just be getting $157 per unit as displayed in appendix 2 which gives a breakdown of gross success and net profitability for American Chemical Corp for launching Case Study Help.
Place: A circulation model where American Chemical Corp directly sends the product to the local distributor and keeps a 10% drop delivery allowance for the supplier would be utilized by American Chemical Corp. Considering that the sales group is currently taken part in selling instantaneous adhesives and they do not have competence in selling dispensers, involving them in the selling process would be pricey especially as each sales call costs around $120. The suppliers are already selling dispensers so offering Case Study Help through them would be a favorable alternative.
Promotion: A low advertising spending plan needs to have been assigned to Case Study Help but the fact that the dispenser is a development and it needs to be marketed well in order to cover the capital expenses incurred for production, the suggested marketing plan costing $51816 is suggested for initially presenting the item in the market. The prepared ads in magazines would be targeted at mechanics in automobile upkeep shops. (Recommended text for the advertisement is displayed in appendix 3 while the 4Ps are summed up in appendix 4).
