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Patten Corp Case Study Solution
Patten Corp Case Study Help
Patten Corp Case Study Analysis
The following area concentrates on the of marketing for Patten Corp where the business's consumers, competitors and core proficiencies have actually assessed in order to validate whether the decision to introduce Case Study Help under Patten Corp trademark name would be a practical alternative or not. We have actually firstly looked at the kind of customers that Patten Corp deals in while an evaluation of the competitive environment and the business's strengths and weaknesses follows. Embedded in the 3C analysis is the reason for not launching Case Study Help under Patten Corp name.
Patten Corp customers can be segmented into two groups, industrial clients and final consumers. Both the groups use Patten Corp high performance adhesives while the company is not only involved in the production of these adhesives however likewise markets them to these customer groups. There are 2 types of products that are being offered to these potential markets; anaerobic adhesives and instant adhesives. We would be concentrating on the consumers of instantaneous adhesives for this analysis since the marketplace for the latter has a lower capacity for Patten Corp compared to that of instantaneous adhesives.
The total market for instantaneous adhesives is roughly 890,000 in the United States in 1978 which covers both consumer groups which have actually been recognized earlier.If we take a look at a breakdown of Patten Corp prospective market or customer groups, we can see that the business offers to OEMs (Original Devices Manufacturers), Do-it-Yourself consumers, repair and overhauling companies (MRO) and producers handling items made of leather, plastic, metal and wood. This diversity in consumers suggests that Patten Corp can target has various alternatives in regards to segmenting the market for its new product especially as each of these groups would be requiring the same type of item with respective modifications in quantity, packaging or need. The consumer is not price sensitive or brand mindful so releasing a low priced dispenser under Patten Corp name is not a recommended alternative.
Patten Corp is not just a maker of adhesives however takes pleasure in market management in the instant adhesive market. The company has its own competent and competent sales force which adds value to sales by training the company's network of 250 distributors for facilitating the sale of adhesives. Patten Corp believes in exclusive distribution as suggested by the reality that it has actually picked to sell through 250 suppliers whereas there is t a network of 10000 suppliers that can be explored for expanding reach via suppliers. The company's reach is not limited to The United States and Canada just as it also takes pleasure in international sales. With 1400 outlets spread all throughout The United States and Canada, Patten Corp has its in-house production plants instead of utilizing out-sourcing as the preferred strategy.
Core skills are not restricted to adhesive manufacturing just as Patten Corp likewise specializes in making adhesive dispensing equipment to help with making use of its products. This double production strategy provides Patten Corp an edge over competitors because none of the rivals of dispensing devices makes immediate adhesives. Furthermore, none of these rivals offers directly to the consumer either and utilizes suppliers for connecting to customers. While we are taking a look at the strengths of Patten Corp, it is important to highlight the business's weak points also.
The business's sales personnel is skilled in training suppliers, the truth stays that the sales group is not trained in selling equipment so there is a possibility of relying greatly on suppliers when promoting adhesive devices. Nevertheless, it should likewise be kept in mind that the suppliers are showing hesitation when it concerns selling equipment that needs maintenance which increases the difficulties of selling devices under a particular brand name.
If we look at Patten Corp line of product in adhesive equipment particularly, the business has actually items targeted at the high end of the market. If Patten Corp sells Case Study Help under the very same portfolio, the possibility of sales cannibalization exists. Provided the truth that Case Study Help is priced lower than Patten Corp high-end line of product, sales cannibalization would absolutely be affecting Patten Corp sales profits if the adhesive devices is sold under the business's brand.
We can see sales cannibalization impacting Patten Corp 27A Pencil Applicator which is priced at $275. There is another possible threat which could lower Patten Corp profits if Case Study Help is introduced under the business's brand. The fact that $175000 has actually been invested in promoting SuperBonder recommends that it is not a great time for launching a dispenser which can highlight the truth that SuperBonder can get logged and Case Study Help is the anti-clogging solution for the immediate adhesive.
Furthermore, if we take a look at the market in general, the adhesives market does disappoint brand orientation or rate consciousness which provides us 2 extra reasons for not launching a low priced item under the company's brand name.
The competitive environment of Patten 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 buyer in this industry is low particularly as the purchaser has low understanding about the item. While business like Patten Corp have actually handled to train suppliers relating to adhesives, the last customer depends on distributors. Roughly 72% of sales are made directly by producers and suppliers for immediate adhesives so the buyer has a low bargaining power.
Bargaining Power of Supplier: Offered the truth that the adhesive market is controlled by three gamers, it could be said that the provider delights in a greater bargaining power compared to the buyer. Nevertheless, the truth remains that the supplier does not have much influence over the buyer at this point specifically as the buyer does disappoint brand recognition or rate sensitivity. This indicates that the supplier has the greater power when it comes to the adhesive market while the buyer and the producer do not have a significant control over the real sales.
Threat of new entrants: The competitive environment with its low brand commitment and the ease of entry revealed by foreign Japanese competitors in the instant adhesive market indicates that the marketplace enables ease of entry. If we look at Patten Corp in particular, the company has dual abilities in terms of being a maker of adhesive dispensers and instant adhesives. Possible dangers in devices dispensing industry are low which shows the possibility of developing brand name awareness in not only instantaneous adhesives however likewise in dispensing adhesives as none of the industry players has managed to position itself in dual capabilities.
Risk of Substitutes: The threat of replacements in the instant adhesive market is low while the dispenser market in particular has replacements like Glumetic suggestion applicators, in-built applicators, pencil applicators and advanced consoles. The truth stays that if Patten Corp presented Case Study Help, it would be delighting in sales cannibalization for its own products. (see appendix 1 for framework).
Despite the fact that our 3C analysis has provided numerous factors for not releasing Case Study Help under Patten Corp name, we have a recommended marketing mix for Case Study Help offered listed below if Patten Corp chooses to go on with the launch.
Product & Target Market: The target market selected for Case Study Help is 'Motor lorry services' for a number of factors. This market has an additional growth potential of 10.1% which may be a good enough specific niche market segment for Case Study Help. Not just would a portable dispenser offer benefit to this particular market, the reality that the Do-it-Yourself market can likewise be targeted if a drinkable low priced adhesive is being offered for usage with SuperBonder.
Price: The recommended price of Case Study Help has actually been kept at $175 to the end user whether it is sold through suppliers or by means of direct selling. A cost listed below $250 would not require approvals from the senior management in case a mechanic at a motor automobile maintenance store requires to purchase the product on his own.
Patten Corp would just be getting $157 per unit as displayed in appendix 2 which offers a breakdown of gross success and net success for Patten Corp for launching Case Study Help.
Place: A circulation model where Patten Corp directly sends the product to the local distributor and keeps a 10% drop shipment allowance for the supplier would be utilized by Patten Corp. Given that the sales team is currently taken part in selling immediate adhesives and they do not have competence in selling dispensers, involving them in the selling process would be expensive especially as each sales call costs roughly $120. The distributors are already offering dispensers so selling Case Study Help through them would be a favorable choice.
Promotion: A low marketing budget plan must have been assigned to Case Study Help but the reality that the dispenser is an innovation and it requires to be marketed well in order to cover the capital expenses sustained for production, the suggested advertising plan costing $51816 is suggested for at first introducing the item in the market. The prepared advertisements in magazines would be targeted at mechanics in lorry upkeep shops. (Recommended text for the ad is displayed in appendix 3 while the 4Ps are summarized in appendix 4).
