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Craig Manufacturing Case Study Solution
Craig Manufacturing Case Study Help
Craig Manufacturing Case Study Analysis
The following area focuses on the of marketing for Craig Manufacturing where the business's consumers, rivals and core competencies have actually assessed in order to validate whether the decision to release Case Study Help under Craig Manufacturing brand would be a possible alternative or not. We have first of all taken a look at the type of customers that Craig Manufacturing handle while an assessment of the competitive environment and the business's strengths and weaknesses follows. Embedded in the 3C analysis is the validation for not introducing Case Study Help under Craig Manufacturing name.
Both the groups utilize Craig Manufacturing high performance adhesives while the business is not only involved in the production of these adhesives but likewise markets them to these customer groups. We would be focusing on the consumers of instant adhesives for this analysis since the market for the latter has a lower capacity for Craig Manufacturing compared to that of instant adhesives.
The overall market for instantaneous adhesives is approximately 890,000 in the US in 1978 which covers both customer groups which have been determined earlier.If we take a look at a breakdown of Craig Manufacturing potential market or customer groups, we can see that the company sells to OEMs (Initial Equipment Makers), Do-it-Yourself consumers, repair and revamping business (MRO) and producers handling products made from leather, plastic, wood and metal. This diversity in customers suggests that Craig Manufacturing can target has numerous options in terms of segmenting the marketplace for its brand-new item particularly as each of these groups would be requiring the exact same kind of product with particular modifications in amount, product packaging or need. The consumer is not cost sensitive or brand name conscious so launching a low priced dispenser under Craig Manufacturing name is not a suggested choice.
Craig Manufacturing is not just a producer of adhesives but takes pleasure in market leadership in the immediate adhesive industry. The company has its own knowledgeable and qualified sales force which adds worth to sales by training the business's network of 250 distributors for facilitating the sale of adhesives. Craig Manufacturing believes in exclusive distribution as suggested by the fact that it has selected to offer through 250 suppliers whereas there is t a network of 10000 suppliers that can be explored for expanding reach through suppliers. The company's reach is not limited to North America only as it likewise delights in international sales. With 1400 outlets spread all throughout North America, Craig Manufacturing has its internal production plants rather than using out-sourcing as the favored strategy.
Core competences are not restricted to adhesive production only as Craig Manufacturing also specializes in making adhesive dispensing equipment to help with using its items. This double production method offers Craig Manufacturing an edge over competitors because none of the competitors of giving devices makes instantaneous adhesives. In addition, none of these competitors offers directly to the consumer either and uses distributors for reaching out to consumers. While we are looking at the strengths of Craig Manufacturing, it is essential to highlight the business's weaknesses too.
The company's sales personnel is experienced 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 needs to also be kept in mind that the suppliers are revealing reluctance when it concerns offering equipment that requires maintenance which increases the obstacles of selling equipment under a particular trademark name.
If we look at Craig Manufacturing product line in adhesive devices especially, the company has actually products focused on the luxury of the marketplace. If Craig Manufacturing offers Case Study Help under the same portfolio, the possibility of sales cannibalization exists. Provided the truth that Case Study Help is priced lower than Craig Manufacturing high-end product line, sales cannibalization would absolutely be affecting Craig Manufacturing sales revenue if the adhesive equipment is offered under the business's brand.
We can see sales cannibalization impacting Craig Manufacturing 27A Pencil Applicator which is priced at $275. There is another possible risk which could reduce Craig Manufacturing income if Case Study Help is released under the business's trademark name. The truth that $175000 has actually been spent in promoting SuperBonder recommends 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 immediate adhesive.
Additionally, if we look at the marketplace in general, the adhesives market does not show brand name orientation or rate consciousness which gives us two extra reasons for not releasing a low priced item under the company's brand.
The competitive environment of Craig Manufacturing would be studied by means of Porter's five 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 especially as the purchaser has low understanding about the product. While companies like Craig Manufacturing have handled to train suppliers concerning adhesives, the final consumer is dependent on suppliers. Around 72% of sales are made straight by makers and distributors for instantaneous adhesives so the purchaser has a low bargaining power.
Bargaining Power of Supplier: Provided the fact that the adhesive market is controlled by three gamers, it could be said that the supplier enjoys a greater bargaining power compared to the purchaser. Nevertheless, the truth remains that the provider does not have much influence over the purchaser at this point particularly as the buyer does not show brand name recognition or cost level of sensitivity. When it comes to the adhesive market while the manufacturer and the purchaser do not have a major control over the real sales, this shows 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 shows that the market allows ease of entry. If we look at Craig Manufacturing in particular, the company has dual capabilities in terms of being a maker of adhesive dispensers and instant adhesives. Prospective risks in devices giving market are low which shows the possibility of producing brand awareness in not just instantaneous adhesives however likewise in giving adhesives as none of the market players has actually handled to position itself in double abilities.
Hazard of Substitutes: The hazard of replacements in the instantaneous adhesive market is low while the dispenser market in particular has substitutes like Glumetic tip applicators, in-built applicators, pencil applicators and sophisticated consoles. The fact remains that if Craig Manufacturing introduced Case Study Help, it would be delighting in sales cannibalization for its own products. (see appendix 1 for structure).
Despite the fact that our 3C analysis has provided various reasons for not introducing Case Study Help under Craig Manufacturing name, we have actually a recommended marketing mix for Case Study Help given below if Craig Manufacturing decides to proceed with the launch.
Product & Target Market: The target audience chosen for Case Study Help is 'Motor vehicle services' for a variety of reasons. There are presently 89257 establishments in this segment and a high use of approximately 58900 pounds. is being utilized by 36.1 % of the market. This market has an extra growth potential of 10.1% which may be a good enough specific niche market section for Case Study Help. Not only would a portable dispenser offer benefit to this specific market, the reality that the Do-it-Yourself market can also be targeted if a drinkable low priced adhesive is being cost usage with SuperBonder. The product would be sold without the 'glumetic tip' and 'vari-drop' so that the customer can decide whether he wishes 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 offered through suppliers or through direct selling. This price would not include the expense of the 'vari tip' or the 'glumetic tip'. A rate listed below $250 would not require approvals from the senior management in case a mechanic at a motor vehicle maintenance shop needs to buy the product on his own. This would increase the possibility of affecting mechanics to acquire the item for use in their daily maintenance jobs.
Craig Manufacturing would only be getting $157 per unit as displayed in appendix 2 which provides a breakdown of gross success and net profitability for Craig Manufacturing for launching Case Study Help.
Place: A circulation design where Craig Manufacturing directly sends out the product to the local distributor and keeps a 10% drop shipment allowance for the supplier would be utilized by Craig Manufacturing. Considering that the sales team is already participated in selling immediate adhesives and they do not have knowledge in selling dispensers, including them in the selling procedure would be expensive particularly as each sales call costs around $120. The suppliers are already selling dispensers so selling Case Study Help through them would be a favorable option.
Promotion: Although a low advertising budget plan needs to have been appointed 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 suggested marketing strategy costing $51816 is advised for initially introducing the product in the market. The prepared advertisements in magazines would be targeted at mechanics in car maintenance stores. (Suggested text for the advertisement is shown in appendix 3 while the 4Ps are summed up in appendix 4).
