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Texas Eastman Co Case Study Solution
Texas Eastman Co Case Study Help
Texas Eastman Co Case Study Analysis
The following section focuses on the of marketing for Texas Eastman Co where the company's consumers, competitors and core competencies have examined in order to justify whether the decision to introduce Case Study Help under Texas Eastman Co trademark name would be a possible alternative or not. We have to start with taken a look at the type of clients that Texas Eastman Co deals in while an examination of the competitive environment and the business's weaknesses and strengths follows. Embedded in the 3C analysis is the validation for not launching Case Study Help under Texas Eastman Co name.
Both the groups utilize Texas Eastman Co high performance adhesives while the company is not only involved in the production of these adhesives however also markets them to these client groups. We would be focusing on the consumers of immediate adhesives for this analysis considering that the market for the latter has a lower capacity for Texas Eastman Co compared to that of instant adhesives.
The total market for instant adhesives is roughly 890,000 in the United States in 1978 which covers both consumer groups which have actually been identified earlier.If we look at a breakdown of Texas Eastman Co prospective market or consumer groups, we can see that the company sells to OEMs (Original Devices Makers), Do-it-Yourself customers, repair and revamping companies (MRO) and producers handling items made from leather, metal, plastic and wood. This variety in consumers suggests that Texas Eastman Co can target has various choices in terms of segmenting the market for its brand-new product particularly as each of these groups would be requiring the exact same kind of product with particular changes in packaging, demand or quantity. However, the client is not rate sensitive or brand name conscious so launching a low priced dispenser under Texas Eastman Co name is not a suggested alternative.
Texas Eastman Co is not simply a manufacturer of adhesives however takes pleasure in market management in the immediate adhesive industry. The business has its own competent and competent sales force which adds value to sales by training the company's network of 250 suppliers for assisting in the sale of adhesives.
Core proficiencies are not limited to adhesive production just as Texas Eastman Co also focuses on making adhesive giving devices to assist in using its products. This double production strategy gives Texas Eastman Co an edge over competitors given that none of the rivals of dispensing devices makes instantaneous adhesives. Furthermore, none of these competitors offers directly to the customer either and makes use of suppliers for reaching out to consumers. While we are looking at the strengths of Texas Eastman Co, it is essential to highlight the company's weak points.
The business's sales personnel is skilled in training distributors, the reality stays that the sales team is not trained in selling devices so there is a possibility of relying heavily on suppliers when promoting adhesive devices. However, it ought to likewise be kept in mind that the distributors are showing unwillingness when it comes to offering equipment that requires maintenance which increases the obstacles of selling devices under a particular trademark name.
If we look at Texas Eastman Co product line in adhesive equipment especially, the business has actually items aimed at the high-end of the marketplace. If Texas Eastman Co offers Case Study Help under the very same portfolio, the possibility of sales cannibalization exists. Offered the truth that Case Study Help is priced lower than Texas Eastman Co high-end product line, sales cannibalization would certainly be affecting Texas Eastman Co sales profits if the adhesive equipment is offered under the business's trademark name.
We can see sales cannibalization affecting Texas Eastman Co 27A Pencil Applicator which is priced at $275. There is another possible hazard which might decrease Texas Eastman Co income if Case Study Help is introduced under the company's brand name. The fact that $175000 has actually been invested in promoting SuperBonder suggests that it is not a great time for launching 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 take a look at the marketplace in general, the adhesives market does disappoint brand orientation or price awareness which offers us 2 extra reasons for not launching a low priced item under the business's brand.
The competitive environment of Texas Eastman Co 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 purchaser in this market is low particularly as the purchaser has low knowledge about the item. While business like Texas Eastman Co have handled to train suppliers regarding adhesives, the final customer is dependent on distributors. Approximately 72% of sales are made directly by makers and distributors for immediate adhesives so the purchaser has a low bargaining power.
Bargaining Power of Supplier: Offered the reality that the adhesive market is dominated by three gamers, it could be stated that the supplier enjoys a greater bargaining power compared to the purchaser. The reality stays that the supplier does not have much influence over the buyer at this point especially as the buyer does not reveal brand recognition or rate sensitivity. This indicates that the supplier has the higher power when it concerns the adhesive market while the buyer and the producer do not have a significant control over the actual sales.
Threat of new entrants: The competitive environment with its low brand name loyalty and the ease of entry shown by foreign Japanese competitors in the immediate adhesive market suggests that the market allows ease of entry. Nevertheless, if we take a look at Texas Eastman Co in particular, the business has double abilities in regards to being a producer of instant adhesives and adhesive dispensers. Prospective threats in devices dispensing industry are low which shows the possibility of developing brand awareness in not only instantaneous adhesives however likewise in dispensing adhesives as none of the market players has managed to position itself in double abilities.
Risk of Substitutes: The hazard of substitutes in the immediate adhesive industry 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 Texas Eastman Co presented Case Study Help, it would be enjoying sales cannibalization for its own products. (see appendix 1 for framework).
Despite the fact that our 3C analysis has given different factors for not introducing Case Study Help under Texas Eastman Co name, we have actually a recommended marketing mix for Case Study Help offered listed below if Texas Eastman Co decides to go ahead with the launch.
Product & Target Market: The target market picked for Case Study Help is 'Automobile services' for a variety of factors. There are presently 89257 facilities in this segment and a high use of roughly 58900 lbs. is being used by 36.1 % of the marketplace. This market has an additional development capacity of 10.1% which might be a good enough specific niche market sector for Case Study Help. Not just would a portable dispenser offer convenience to this specific market, the fact that the Do-it-Yourself market can likewise be targeted if a safe and clean low priced adhesive is being sold for usage with SuperBonder. The item would be offered without the 'glumetic pointer' and 'vari-drop' so that the customer can choose whether he wishes to choose either of the two devices or not.
Price: The recommended cost of Case Study Help has been kept at $175 to the end user whether it is sold through suppliers or by means of direct selling. A price below $250 would not require approvals from the senior management in case a mechanic at a motor lorry upkeep shop requires to buy the item on his own.
Texas Eastman Co would just be getting $157 per unit as shown in appendix 2 which provides a breakdown of gross success and net success for Texas Eastman Co for releasing Case Study Help.
Place: A circulation design where Texas Eastman Co directly sends out the item to the regional distributor and keeps a 10% drop shipment allowance for the distributor would be utilized by Texas Eastman Co. Given that the sales group is currently participated in selling instant adhesives and they do not have expertise in selling dispensers, involving them in the selling process would be costly especially as each sales call expenses around $120. The suppliers are already selling dispensers so offering Case Study Help through them would be a favorable alternative.
Promotion: A low advertising spending plan must have been appointed to Case Study Help but the truth that the dispenser is an innovation and it requires to be marketed well in order to cover the capital costs sustained for production, the recommended advertising strategy costing $51816 is recommended for at first presenting the product in the market. The planned ads in publications would be targeted at mechanics in car upkeep stores. (Recommended text for the advertisement is shown in appendix 3 while the 4Ps are summarized in appendix 4).
