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Applied Materials Managing Product Costs Case Study Solution
Applied Materials Managing Product Costs Case Study Help
Applied Materials Managing Product Costs Case Study Analysis
The following area concentrates on the of marketing for Applied Materials Managing Product Costs where the company's consumers, competitors and core proficiencies have assessed in order to validate whether the choice to release Case Study Help under Applied Materials Managing Product Costs brand name would be a practical choice or not. We have actually firstly looked at the type of consumers that Applied Materials Managing Product Costs deals in while an examination of the competitive environment and the business's weaknesses and strengths follows. Embedded in the 3C analysis is the validation for not introducing Case Study Help under Applied Materials Managing Product Costs name.
Applied Materials Managing Product Costs clients can be segmented into two groups, final consumers and commercial consumers. Both the groups utilize Applied Materials Managing Product Costs high performance adhesives while the company is not just involved in the production of these adhesives however also markets them to these consumer groups. There are 2 types of products that are being sold to these potential markets; instant adhesives and anaerobic adhesives. We would be concentrating on the customers of instant adhesives for this analysis considering that the marketplace for the latter has a lower potential for Applied Materials Managing Product Costs compared to that of instantaneous adhesives.
The total market for immediate adhesives is roughly 890,000 in the United States in 1978 which covers both customer groups which have actually been recognized earlier.If we take a look at a breakdown of Applied Materials Managing Product Costs prospective market or client groups, we can see that the company sells to OEMs (Original Devices Manufacturers), Do-it-Yourself customers, repair and revamping companies (MRO) and manufacturers dealing in products made of leather, plastic, metal and wood. This variety in consumers suggests that Applied Materials Managing Product Costs can target has various alternatives in terms of segmenting the marketplace for its brand-new item especially as each of these groups would be needing the very same type of item with respective changes in product packaging, demand or amount. The customer is not cost sensitive or brand name conscious so releasing a low priced dispenser under Applied Materials Managing Product Costs name is not an advised alternative.
Applied Materials Managing Product Costs is not just a manufacturer of adhesives however enjoys market management in the immediate adhesive industry. The business has its own competent and certified sales force which adds worth to sales by training the company's network of 250 suppliers for helping with the sale of adhesives. Applied Materials Managing Product Costs believes in exclusive distribution as shown by the reality that it has actually chosen to sell through 250 distributors whereas there is t a network of 10000 distributors that can be explored for expanding reach by means of suppliers. The company's reach is not limited to North America just as it likewise takes pleasure in global sales. With 1400 outlets spread out all across North America, Applied Materials Managing Product Costs has its internal production plants rather than using out-sourcing as the preferred method.
Core skills are not restricted to adhesive manufacturing only as Applied Materials Managing Product Costs likewise focuses on making adhesive giving devices to facilitate the use of its products. This dual production strategy offers Applied Materials Managing Product Costs an edge over competitors given that none of the competitors of dispensing equipment makes immediate adhesives. Additionally, none of these rivals offers directly to the customer either and makes use of suppliers for connecting to consumers. While we are taking a look at the strengths of Applied Materials Managing Product Costs, it is very important to highlight the company's weaknesses too.
Although the business's sales staff is knowledgeable in training distributors, the truth remains that the sales group is not trained in selling devices so there is a possibility of relying heavily on distributors when promoting adhesive devices. Nevertheless, it should also be noted that the suppliers are revealing reluctance when it concerns selling equipment that requires maintenance which increases the challenges of selling devices under a specific brand.
If we take a look at Applied Materials Managing Product Costs product line in adhesive devices particularly, the company has actually items focused on the high-end of the marketplace. The possibility of sales cannibalization exists if Applied Materials Managing Product Costs sells Case Study Help under the exact same portfolio. Offered the truth that Case Study Help is priced lower than Applied Materials Managing Product Costs high-end product line, sales cannibalization would absolutely be impacting Applied Materials Managing Product Costs sales profits if the adhesive devices is offered under the company's trademark name.
We can see sales cannibalization impacting Applied Materials Managing Product Costs 27A Pencil Applicator which is priced at $275. There is another possible risk which might decrease Applied Materials Managing Product Costs profits if Case Study Help is released under the company's brand. The fact that $175000 has been invested in promoting SuperBonder suggests that it is not a great time for launching a dispenser which can highlight the fact that SuperBonder can get logged and Case Study Help is the anti-clogging solution for the instantaneous adhesive.
In addition, if we take a look at the marketplace in general, the adhesives market does disappoint brand orientation or rate awareness which offers us 2 additional reasons for not launching a low priced product under the business's trademark name.
The competitive environment of Applied Materials Managing Product Costs would be studied via Porter's 5 forces analysis which would highlight the degree of rivalry in the market.
Bargaining Power of Buyer: The Bargaining power of the buyer in this industry is low specifically as the purchaser has low understanding about the item. While companies like Applied Materials Managing Product Costs have managed to train distributors relating to adhesives, the last consumer is dependent on distributors. Roughly 72% of sales are made straight by manufacturers and suppliers for instant adhesives so the buyer has a low bargaining power.
Bargaining Power of Supplier: Given the reality that the adhesive market is controlled by three players, it could be said that the provider delights in a higher bargaining power compared to the purchaser. The fact stays that the provider does not have much impact over the buyer at this point particularly as the purchaser does not show brand name recognition or price level of sensitivity. When it comes to the adhesive market while the purchaser and the producer do not have a significant control over the real sales, this indicates that the supplier has the higher power.
Threat of new entrants: The competitive environment with its low brand loyalty and the ease of entry shown by foreign Japanese rivals in the immediate adhesive market shows that the marketplace allows ease of entry. If we look at Applied Materials Managing Product Costs in particular, the company has double abilities in terms of being a maker of adhesive dispensers and immediate adhesives. Possible threats in devices dispensing industry are low which reveals the possibility of developing brand name awareness in not only instant adhesives however also in dispensing adhesives as none of the industry gamers has handled to position itself in double capabilities.
Risk of Substitutes: The hazard of alternatives in the immediate adhesive industry is low while the dispenser market in particular has replacements like Glumetic tip applicators, in-built applicators, pencil applicators and advanced consoles. The truth stays that if Applied Materials Managing Product Costs 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 different factors for not releasing Case Study Help under Applied Materials Managing Product Costs name, we have a recommended marketing mix for Case Study Help given below if Applied Materials Managing Product Costs chooses to proceed with the launch.
Product & Target Market: The target market picked for Case Study Help is 'Motor car services' for a number of reasons. This market has an extra development capacity of 10.1% which may be an excellent enough specific niche market sector for Case Study Help. Not just would a portable dispenser offer benefit to this specific market, the reality that the Diy market can likewise be targeted if a potable low priced adhesive is being offered for usage with SuperBonder.
Price: The suggested cost of Case Study Help has actually been kept at $175 to the end user whether it is sold through distributors or through direct selling. A rate below $250 would not need approvals from the senior management in case a mechanic at a motor automobile upkeep store needs to buy the product on his own.
Applied Materials Managing Product Costs would just be getting $157 per unit as displayed in appendix 2 which gives a breakdown of gross success and net success for Applied Materials Managing Product Costs for releasing Case Study Help.
Place: A distribution model where Applied Materials Managing Product Costs straight sends the item to the regional distributor and keeps a 10% drop shipment allowance for the supplier would be utilized by Applied Materials Managing Product Costs. Given that the sales group is currently participated in offering instantaneous adhesives and they do not have competence in offering dispensers, involving them in the selling process would be costly particularly as each sales call costs around $120. The suppliers are already offering dispensers so offering Case Study Help through them would be a favorable choice.
Promotion: Although a low marketing budget must have been designated to Case Study Help however the truth that the dispenser is a development and it needs to be marketed well in order to cover the capital expenses incurred for production, the recommended advertising plan costing $51816 is recommended for initially introducing the item in the market. The prepared advertisements in publications would be targeted at mechanics in automobile upkeep shops. (Suggested text for the ad is displayed in appendix 3 while the 4Ps are summarized in appendix 4).
