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Chocolate Confections Corporation Case Study Solution
Chocolate Confections Corporation Case Study Help
Chocolate Confections Corporation Case Study Analysis
The following section concentrates on the of marketing for Chocolate Confections Corporation where the company's consumers, rivals and core competencies have assessed in order to validate whether the decision to release Case Study Help under Chocolate Confections Corporation brand would be a possible choice or not. We have first of all looked at the type of customers that Chocolate Confections Corporation deals in while an evaluation of the competitive environment and the company's weaknesses and strengths follows. Embedded in the 3C analysis is the reason for not releasing Case Study Help under Chocolate Confections Corporation name.
Both the groups utilize Chocolate Confections Corporation high performance adhesives while the company is not just involved in the production of these adhesives however likewise markets them to these customer groups. We would be focusing on the consumers of instant adhesives for this analysis because the market for the latter has a lower potential for Chocolate Confections Corporation compared to that of immediate adhesives.
The total market for immediate adhesives is approximately 890,000 in the US in 1978 which covers both consumer groups which have been determined earlier.If we take a look at a breakdown of Chocolate Confections Corporation possible market or customer groups, we can see that the company sells to OEMs (Original Equipment Producers), Do-it-Yourself consumers, repair work and revamping companies (MRO) and manufacturers dealing in products made of leather, wood, plastic and metal. This variety in clients recommends that Chocolate Confections Corporation can target has different options in terms of segmenting the market for its new item particularly as each of these groups would be needing the very same kind of product with particular changes in quantity, need or product packaging. Nevertheless, the client is not price sensitive or brand mindful so launching a low priced dispenser under Chocolate Confections Corporation name is not an advised option.
Chocolate Confections Corporation is not simply a maker of adhesives however enjoys market leadership in the instantaneous adhesive market. The business has its own knowledgeable and certified sales force which adds worth to sales by training the business's network of 250 suppliers for assisting in the sale of adhesives. Chocolate Confections Corporation believes in unique distribution as suggested by the reality that it has chosen to offer through 250 suppliers whereas there is t a network of 10000 suppliers that can be explored for expanding reach by means of suppliers. The company's reach is not restricted to The United States and Canada only as it likewise takes pleasure in global sales. With 1400 outlets spread all throughout North America, Chocolate Confections Corporation has its in-house production plants instead of utilizing out-sourcing as the favored strategy.
Core competences are not restricted to adhesive manufacturing only as Chocolate Confections Corporation also focuses on making adhesive giving equipment to facilitate using its products. This double production method gives Chocolate Confections Corporation an edge over rivals since none of the competitors of giving devices makes instantaneous adhesives. Additionally, none of these rivals offers straight to the consumer either and uses suppliers for reaching out to consumers. While we are looking at the strengths of Chocolate Confections Corporation, it is essential to highlight the company's weaknesses too.
The company's sales staff is competent in training distributors, the truth remains that the sales group is not trained in selling equipment so there is a possibility of relying heavily on distributors when promoting adhesive devices. Nevertheless, it should likewise be noted that the distributors are revealing unwillingness when it pertains to offering equipment that needs maintenance which increases the challenges of selling equipment under a specific trademark name.
The business has products aimed at the high end of the market if we look at Chocolate Confections Corporation item line in adhesive equipment especially. The possibility of sales cannibalization exists if Chocolate Confections Corporation offers Case Study Help under the very same portfolio. Provided the truth that Case Study Help is priced lower than Chocolate Confections Corporation high-end product line, sales cannibalization would definitely be affecting Chocolate Confections Corporation sales revenue if the adhesive devices is sold under the business's brand.
We can see sales cannibalization impacting Chocolate Confections Corporation 27A Pencil Applicator which is priced at $275. If Case Study Help is introduced under the company's brand name, there is another possible hazard which could reduce Chocolate Confections Corporation earnings. The reality that $175000 has been spent in promoting SuperBonder recommends that it is not a great time for introducing a dispenser which can highlight the reality that SuperBonder can get logged and Case Study Help is the anti-clogging solution for the immediate adhesive.
Additionally, if we look at the market in general, the adhesives market does not show brand orientation or cost consciousness which offers us two additional factors for not releasing a low priced product under the company's brand name.
The competitive environment of Chocolate Confections Corporation 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 industry is low especially as the buyer has low understanding about the product. While companies like Chocolate Confections Corporation have handled to train distributors regarding adhesives, the last consumer depends on distributors. Roughly 72% of sales are made directly by makers and distributors for immediate adhesives so the buyer has a low bargaining power.
Bargaining Power of Supplier: Offered the reality that the adhesive market is controlled by 3 players, it could be stated that the provider takes pleasure in a greater bargaining power compared to the buyer. The reality 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 cost level of sensitivity. When it comes to the adhesive market while the purchaser and the maker do not have a significant control over the real sales, this suggests that the distributor has the greater power.
Threat of new entrants: The competitive environment with its low brand name commitment and the ease of entry shown by foreign Japanese rivals in the immediate adhesive market suggests that the market allows ease of entry. If we look at Chocolate Confections Corporation in particular, the company has double abilities in terms of being a producer of adhesive dispensers and immediate adhesives. Potential dangers in devices dispensing market are low which reveals the possibility of creating brand name awareness in not only instantaneous adhesives however also in dispensing adhesives as none of the industry gamers has handled to position itself in double capabilities.
Risk of Substitutes: The risk of alternatives in the immediate adhesive industry is low while the dispenser market in particular has alternatives like Glumetic idea applicators, inbuilt applicators, pencil applicators and sophisticated consoles. The reality stays that if Chocolate Confections Corporation presented Case Study Help, it would be enjoying sales cannibalization for its own items. (see appendix 1 for structure).
Despite the fact that our 3C analysis has provided various reasons for not launching Case Study Help under Chocolate Confections Corporation name, we have actually a suggested marketing mix for Case Study Help provided listed below if Chocolate Confections Corporation decides to proceed with the launch.
Product & Target Market: The target market selected for Case Study Help is 'Motor vehicle services' for a number of reasons. This market has an extra growth capacity of 10.1% which may be an excellent adequate niche market segment for Case Study Help. Not only would a portable dispenser deal benefit to this particular 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.
Price: The suggested price of Case Study Help has been kept at $175 to the end user whether it is offered through distributors or through direct selling. A rate listed below $250 would not need approvals from the senior management in case a mechanic at a motor car upkeep store requires to acquire the product on his own.
Chocolate Confections Corporation would just be getting $157 per unit as shown in appendix 2 which provides a breakdown of gross profitability and net profitability for Chocolate Confections Corporation for launching Case Study Help.
Place: A distribution design where Chocolate Confections Corporation straight sends out the item to the local supplier and keeps a 10% drop delivery allowance for the distributor would be used by Chocolate Confections Corporation. Given that the sales team is already engaged in selling instant adhesives and they do not have know-how in offering dispensers, involving them in the selling procedure would be expensive especially as each sales call costs around $120. The distributors are currently offering dispensers so offering Case Study Help through them would be a favorable choice.
Promotion: Although a low marketing spending plan ought to have been assigned to Case Study Help however the reality that the dispenser is a development and it needs to be marketed well in order to cover the capital expenses sustained for production, the recommended advertising strategy costing $51816 is advised for at first presenting the item in the market. The prepared advertisements in publications would be targeted at mechanics in lorry upkeep shops. (Recommended text for the advertisement is displayed in appendix 3 while the 4Ps are summed up in appendix 4).
