The following section focuses on the of marketing for International Paper Longwood Woodyard Plant where the business's consumers, competitors and core competencies have actually examined in order to validate whether the decision to launch Case Study Help under International Paper Longwood Woodyard Plant trademark name would be a practical option or not. We have first of all taken a look at the kind of consumers that International Paper Longwood Woodyard Plant deals in while an examination of the competitive environment and the company's weak points and strengths follows. Embedded in the 3C analysis is the justification for not introducing Case Study Help under International Paper Longwood Woodyard Plant name.
International Paper Longwood Woodyard Plant clients can be segmented into 2 groups, final consumers and industrial customers. Both the groups use International Paper Longwood Woodyard Plant high performance adhesives while the company is not only associated with the production of these adhesives but also markets them to these consumer groups. There are 2 types of products that are being offered to these prospective markets; immediate adhesives and anaerobic adhesives. We would be concentrating on the consumers of instantaneous adhesives for this analysis because the marketplace for the latter has a lower potential for International Paper Longwood Woodyard Plant compared to that of immediate adhesives.
The overall market for immediate adhesives is roughly 890,000 in the United States in 1978 which covers both client groups which have actually been determined earlier.If we take a look at a breakdown of International Paper Longwood Woodyard Plant prospective market or consumer groups, we can see that the company offers to OEMs (Initial Devices Manufacturers), Do-it-Yourself customers, repair and overhauling business (MRO) and makers handling items made from leather, plastic, wood and metal. This diversity in customers recommends that International Paper Longwood Woodyard Plant can target has different choices in terms of segmenting the marketplace for its brand-new product especially as each of these groups would be needing the very same type of product with respective modifications in need, product packaging or quantity. Nevertheless, the client is not cost delicate or brand mindful so launching a low priced dispenser under International Paper Longwood Woodyard Plant name is not an advised alternative.
International Paper Longwood Woodyard Plant is not simply a producer of adhesives however delights in market leadership in the instant adhesive market. The company has its own experienced and qualified sales force which adds worth to sales by training the company's network of 250 distributors for assisting in the sale of adhesives.
Core skills are not limited to adhesive manufacturing just as International Paper Longwood Woodyard Plant also focuses on making adhesive giving equipment to assist in using its products. This double production technique offers International Paper Longwood Woodyard Plant an edge over rivals since none of the rivals of giving equipment makes immediate adhesives. Additionally, none of these competitors sells directly to the consumer either and uses distributors for reaching out to consumers. While we are looking at the strengths of International Paper Longwood Woodyard Plant, it is essential to highlight the company's weaknesses.
Although the business's sales personnel is competent in training distributors, the reality remains that the sales team is not trained in selling equipment so there is a possibility of relying greatly on distributors when promoting adhesive devices. However, it must also be kept in mind that the distributors are showing hesitation when it concerns offering devices that requires servicing which increases the challenges of offering equipment under a particular brand.
The business has products intended at the high end of the market if we look at International Paper Longwood Woodyard Plant item line in adhesive equipment especially. If International Paper Longwood Woodyard Plant offers Case Study Help under the same portfolio, the possibility of sales cannibalization exists. Offered the fact that Case Study Help is priced lower than International Paper Longwood Woodyard Plant high-end line of product, sales cannibalization would certainly be impacting International Paper Longwood Woodyard Plant sales income if the adhesive devices is offered under the business's brand name.
We can see sales cannibalization impacting International Paper Longwood Woodyard Plant 27A Pencil Applicator which is priced at $275. There is another possible hazard which might decrease International Paper Longwood Woodyard Plant revenue if Case Study Help is launched under the company's brand. The truth that $175000 has been invested in promoting SuperBonder suggests that it is not a good time for introducing 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.
Additionally, if we take a look at the market in general, the adhesives market does disappoint brand name orientation or rate consciousness which offers us two extra factors for not releasing a low priced product under the business's brand.
The competitive environment of International Paper Longwood Woodyard Plant would be studied by means of Porter's 5 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 especially as the buyer has low knowledge about the item. While companies like International Paper Longwood Woodyard Plant have actually handled to train distributors regarding adhesives, the final customer is dependent on distributors. Approximately 72% of sales are made directly by makers and suppliers for immediate adhesives so the buyer has a low bargaining power.
Bargaining Power of Supplier: Given the fact that the adhesive market is controlled by 3 players, it could be said that the provider delights in a greater bargaining power compared to the buyer. The truth stays that the supplier does not have much impact over the buyer at this point particularly as the purchaser does not reveal brand name recognition or cost level of sensitivity. When it comes to the adhesive market while the maker and the purchaser do not have a major control over the actual sales, this suggests that the supplier has the higher 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 instant adhesive market suggests that the marketplace allows ease of entry. If we look at International Paper Longwood Woodyard Plant in particular, the company has double capabilities in terms of being a maker of adhesive dispensers and instantaneous adhesives. Possible hazards in equipment dispensing industry are low which shows the possibility of creating brand name awareness in not just immediate adhesives however also in dispensing adhesives as none of the industry gamers has actually managed to place itself in dual capabilities.
Danger of Substitutes: The danger of substitutes in the immediate adhesive industry is low while the dispenser market in particular has substitutes like Glumetic tip applicators, built-in applicators, pencil applicators and advanced consoles. The truth remains that if International Paper Longwood Woodyard Plant 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 actually given various factors for not introducing Case Study Help under International Paper Longwood Woodyard Plant name, we have actually a suggested marketing mix for Case Study Help given below if International Paper Longwood Woodyard Plant decides to proceed with the launch.
Product & Target Market: The target market chosen for Case Study Help is 'Motor lorry services' for a number of factors. This market has an extra growth potential of 10.1% which might be a great adequate niche market section for Case Study Help. Not only would a portable dispenser deal benefit to this particular market, the truth that the Do-it-Yourself market can likewise be targeted if a safe and clean 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 by means of direct selling. A cost listed below $250 would not need approvals from the senior management in case a mechanic at a motor lorry maintenance store requires to acquire the item on his own.
International Paper Longwood Woodyard Plant would only be getting $157 per unit as shown in appendix 2 which gives a breakdown of gross profitability and net profitability for International Paper Longwood Woodyard Plant for releasing Case Study Help.
Place: A circulation model where International Paper Longwood Woodyard Plant directly sends out the item to the regional distributor and keeps a 10% drop delivery allowance for the supplier would be utilized by International Paper Longwood Woodyard Plant. Because the sales group is already engaged in offering instantaneous adhesives and they do not have competence in offering dispensers, involving them in the selling process would be pricey specifically as each sales call costs approximately $120. The distributors are currently offering dispensers so offering Case Study Help through them would be a beneficial alternative.
Promotion: Although a low advertising budget must have been designated to Case Study Help but the reality that the dispenser is a development and it needs to be marketed well in order to cover the capital costs sustained for production, the recommended advertising plan costing $51816 is suggested for at first presenting the product in the market. The planned advertisements in magazines would be targeted at mechanics in lorry maintenance shops. (Recommended text for the ad is displayed in appendix 3 while the 4Ps are summarized in appendix 4).