Cumberland Metal Industries Essay

In its sign evaluation, the company believes that the in the buff harvesting, curled metal cushion pads, has a potence for increasing the companys sales and profit and for diversifying the point of intersectionions it offers. Early demands for the increase appear to be good, however an in-depth analysis of the marketing aspect is requirement before the company put forward introduce the product to the market. Situational Analysis found on the two trials made, it is clear that the company is in possession of a product that is violate than any of those currently available in the market.The interview only is how much punter this product is than the others already available. Based on the early trial performed, the product is 25% much follow-effective than its adpressed competitor in terms of feet of upsurges tryn per hour. It also increases the capability of the operations by requiring less time for fixed changes of about 80%. Each curing of the product also performs n ineteen times better than said competitor. In the sulfur trial, the product maintained its previous cognitive operation as far as feet driven per hour time for set changes is concerned.It surpassed its previous performance by performing forty-nine times better than its competitor. The energy and effectivity of the product translates to other forms of savings on the partitioning of the user. First, the contractor or detergent builder will simplification the greet of renting of the equipment used in the construction by at least 25%. If the workers compensation is computed based on the number of hours worked, the contractor or builder will incur savings geting to 25% of the cost of labor.Aside from its efficiency the product can also decrease, on the part of the workers, the health encounter usually associated with the use of asbestos and decrease employers expenses relating to workers health insurance in the considerable run. Actual figures of demand for the product ar har d to calculate. Based on the assumptions made by Mr. Simpson that the construction industry will indigence to drive 290 million to 390 million feet of piles per year, the total demand for the product annually is around 174,000 (290,000,000/10,000 x 6) to 324,000 (390,000,000/10,000 x 6) pads annually.To penetrate the market, the company will need to convince the key players of the construction industry that it should use the product. The eulogy of the computer architecture/ consulting firms, engineering/construction contractors and independent contractors are a must since they are the ones that will actually use the products. item-by-item contractors could be targeted since they are more willing to try new products that can increase their profits. A corroboratory review from this group can convince bigger firms to use the product.The approval of pile hammer manufacturers and pile hammer distributing/ renting companies will be good but none necessary. These two groups know tha t the use of the product will decrease their profits so they have motivation to not remember the products to their customers. Pile hammer distributing/ renting companies can provide an efficient distribution channel and reduce the companys distribution cost since the mechanism is already in place, but not having the approval of this group is not essential since other methods of distribution are available to the company. erstwhile amount of demand for the product is large enough this group can later decide to offer the product to their customers. Recommendations Initially, the pricing used by the company should be based on the data provided by the root test since it is more conservative. It can gradually increase its prices if the performance of the second trial is confirmed by actual practice. Based on the offshoot trial, the company should charge $167 per pad. This price is computed by multiplying the cost of each set with the number of sets required ($50 x 20 pads) and dividing the result with the no. f pads of curled metal cushion required (1000/6).By development this price, the consumer will incur the same amount of cost for cushion pads in a project whether it uses asbestos or the curled metal cushions it is only the amount of cushion pads used that will vary. However, this price does not charge consumer for the excess benefits provided by the product, such as 25% decrease in the cost of renting equipment and wages of laborers. This will be the selling point of the product upon its introduction.It will be important for the company to concentrate on construction the confidence of the key players of the industry, instead of maximizing the profits in the beginning few years of introducing the product. Marketing campaigns should be focused towards convincing the architecture/ consulting firms, engineering/construction contractors and independent contractors to use the products. It could try to market the products promptly to these groups since renting co mpanies may be hesitant to distribute products that will decrease the profits generated by the services they offered.Moreover, most contractors used their own pile hammers instead of renting, so distribution through these renting companies has limited reach. Independent contractors should be given particular attention, as far as efforts at direct selling is concerned, since these groups are more likely to try new methods that decreases their cost and increases their bottom line than the more established firms. When the reputation of the product is established, it can decide whether it will continue its direct approach or use the services of pile hammer distributing/ renting companies.For the reasons stated above, the demands of the Colerick fundament Company should be accepted by the company since this would be the original of the companys direct sales. In summary, I would like to recommend that the company sell its curled metal cushion pads for $167 each. The company should first focus in building the reputation of its product because of its innovative quality. integrity way of doing so is convincing the experts that it is better than anything else present in the market.