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Health Development Corp Case Study Solution
Health Development Corp Case Study Help
Health Development Corp Case Study Analysis
The following section focuses on the of marketing for Health Development Corp where the company's consumers, competitors and core competencies have actually evaluated in order to justify whether the choice to introduce Case Study Help under Health Development Corp trademark name would be a practical choice or not. We have actually firstly looked at the kind of consumers that Health Development Corp handle while an assessment of the competitive environment and the company's strengths and weaknesses follows. Embedded in the 3C analysis is the validation for not releasing Case Study Help under Health Development Corp name.
Both the groups utilize Health Development Corp high performance adhesives while the business is not only involved in the production of these adhesives however likewise markets them to these client groups. We would be focusing on the consumers of immediate adhesives for this analysis given that the market for the latter has a lower capacity for Health Development Corp compared to that of instantaneous adhesives.
The overall market for instant adhesives is approximately 890,000 in the United States in 1978 which covers both client groups which have been determined earlier.If we take a look at a breakdown of Health Development Corp potential market or client groups, we can see that the company offers to OEMs (Initial Equipment Producers), Do-it-Yourself clients, repair and upgrading companies (MRO) and producers handling products made of leather, metal, wood and plastic. This variety in consumers suggests that Health Development Corp can target has various alternatives in regards to segmenting the marketplace for its brand-new item particularly as each of these groups would be requiring the very same type of item with particular modifications in quantity, packaging or demand. Nevertheless, the consumer is not price delicate or brand name conscious so introducing a low priced dispenser under Health Development Corp name is not an advised option.
Health Development Corp is not just a producer of adhesives however delights in market leadership in the immediate adhesive industry. The business has its own competent and qualified sales force which adds value to sales by training the business's network of 250 distributors for helping with the sale of adhesives. Health Development Corp believes in special circulation as suggested by the reality that it has picked to offer through 250 distributors whereas there is t a network of 10000 distributors that can be checked out for broadening reach via distributors. The business's reach is not restricted to North America only as it likewise enjoys global sales. With 1400 outlets spread all across North America, Health Development Corp has its internal production plants rather than utilizing out-sourcing as the preferred technique.
Core competences are not restricted to adhesive manufacturing only as Health Development Corp also specializes in making adhesive dispensing devices to facilitate using its products. This dual production method offers Health Development Corp an edge over competitors considering that none of the rivals of giving equipment makes instantaneous adhesives. In addition, none of these rivals offers straight to the consumer either and utilizes suppliers for connecting to clients. While we are looking at the strengths of Health Development Corp, it is essential to highlight the business's weak points.
The business's sales personnel is competent in training distributors, the fact stays that the sales team is not trained in selling devices so there is a possibility of relying heavily on distributors when promoting adhesive devices. However, it needs to also be noted that the suppliers are showing reluctance when it comes to offering devices that needs maintenance which increases the obstacles of offering devices under a particular brand name.
If we look at Health Development Corp line of product in adhesive devices particularly, the company has products focused on the luxury of the market. The possibility of sales cannibalization exists if Health Development Corp sells Case Study Help under the very same portfolio. Provided the fact that Case Study Help is priced lower than Health Development Corp high-end line of product, sales cannibalization would certainly be impacting Health Development Corp sales profits if the adhesive equipment is sold under the company's brand name.
We can see sales cannibalization affecting Health Development Corp 27A Pencil Applicator which is priced at $275. If Case Study Help is introduced under the company's brand name, there is another possible risk which might reduce Health Development Corp earnings. The fact that $175000 has actually been spent in promoting SuperBonder suggests that it is not a great 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 instantaneous adhesive.
In addition, if we look at the market in general, the adhesives market does not show brand name orientation or cost awareness which gives us 2 extra reasons for not launching a low priced item under the company's brand.
The competitive environment of Health Development Corp would be studied by means of 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 item. While business like Health Development Corp have actually handled to train distributors regarding adhesives, the final consumer is dependent on distributors. Roughly 72% of sales are made straight by manufacturers and suppliers for instantaneous adhesives so the purchaser has a low bargaining power.
Bargaining Power of Supplier: Offered the truth that the adhesive market is controlled by 3 gamers, it could be said that the provider delights in a higher bargaining power compared to the purchaser. Nevertheless, the truth remains that the provider does not have much influence over the buyer at this point particularly as the purchaser does not show brand acknowledgment or price sensitivity. This indicates that the supplier has the higher power when it comes to the adhesive market while the purchaser and the producer do not have a major control over the actual sales.
Threat of new entrants: The competitive environment with its low brand loyalty and the ease of entry shown by foreign Japanese rivals in the instant adhesive market indicates that the marketplace permits ease of entry. Nevertheless, if we look at Health Development Corp in particular, the business has dual abilities in terms of being a maker of adhesive dispensers and instantaneous adhesives. Prospective threats in equipment dispensing industry are low which shows the possibility of creating brand name awareness in not just immediate adhesives but likewise in dispensing adhesives as none of the industry players has actually managed to place itself in double capabilities.
Danger of Substitutes: The risk of replacements in the instant adhesive market is low while the dispenser market in particular has substitutes like Glumetic idea applicators, built-in applicators, pencil applicators and advanced consoles. The truth stays that if Health Development 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 provided numerous reasons for not launching Case Study Help under Health Development Corp name, we have a suggested marketing mix for Case Study Help offered listed below if Health Development Corp decides to proceed with the launch.
Product & Target Market: The target market chosen for Case Study Help is 'Motor car services' for a number of factors. This market has an extra development capacity of 10.1% which may be a good adequate niche market section for Case Study Help. Not only would a portable dispenser offer convenience to this particular market, the truth that the Do-it-Yourself market can likewise be targeted if a drinkable low priced adhesive is being sold for use with SuperBonder.
Price: The recommended cost of Case Study Help has been kept at $175 to the end user whether it is sold through distributors or via direct selling. A rate 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.
Health Development Corp would just be getting $157 per unit as shown in appendix 2 which gives a breakdown of gross profitability and net profitability for Health Development Corp for releasing Case Study Help.
Place: A circulation model where Health Development Corp directly sends the product to the regional supplier and keeps a 10% drop delivery allowance for the supplier would be used by Health Development Corp. Given that the sales group is already engaged in selling instant adhesives and they do not have expertise in offering dispensers, involving them in the selling procedure would be expensive particularly as each sales call costs approximately $120. The suppliers are currently offering dispensers so selling Case Study Help through them would be a favorable choice.
Promotion: A low marketing spending plan ought to have been appointed to Case Study Help however the reality that the dispenser is a development and it requires to be marketed well in order to cover the capital costs sustained for production, the recommended marketing strategy costing $51816 is recommended for initially introducing the product in the market. The prepared advertisements in publications would be targeted at mechanics in car maintenance stores. (Suggested text for the advertisement is displayed in appendix 3 while the 4Ps are summarized in appendix 4).
