Jones-Blair Case Anaylsis Essay Example

Jones-Blair Case Anaylsis Paper Strategic Issues and Problems: The Jones Blair Company competes in a 50-county country throughout Texas. Oklahoma. New Mexico. and Louisiana. Their major concern and fiscal centre is located in 11 county Dallas-Fort Worth metropolitan countries. Jones Blair Company is a in private held corporation that produces and markets paint under the Jones-Blair trade name name. A big part of the maturating pigment industry. $ 10 billion. is established from architectural coatings and the one-year growing rate is expected to be that of general rising prices in the coming old ages. Dollar gross revenues have increased at an mean one-year rate of 4 per centum per twelvemonth over the past decennary. The company has been really successful in keeping their borders even with increased research and development stuff and labour costs. A little figure of regional pigment makers have competed successfully against pigment maker that distribute their merchandises national. Major manufacturers of pigment fo r the architectural coatings sections account for 60 per centum of gross revenues in the architectural coating sections. The competition is reasonably stiff when it comes to private shop trade names or forte shops. Even with the turning success of Jones Blair it is non adequate and in order to make their concern ends at a clip when growing is nonexistent. Jones Blair must take immediate action and billow their gross revenues squad and alter their gross revenues energies. Mass merchants pose a serious menace to the hereafter achieved gross revenues degrees of Jones Blair Company. Jones Blair Company is presently looking for solutions for deriving more consumers through marketing their architectural coatings and sundries in the southwesterly United States. Market Segmentation The market of Jones Blair can be divided to two groups: Dallas-Fort Worth country and Non Dallas-Fort Worth. Among these two countries. there are the contractors. the DIY families and the professional painters. From reading instance. I gathered that the estimated dollar volume of architectural pigment and allied merchandises sold in Jones Blair’s 50 states service country in 2004 was $ 80 million ( excepting contractor gross revenues ) . The DFW are accounted for 60 per centum or $ 48 million. while the staying 40 per centum or $ 32 million is sold in the other countries outside the DFW country. 70 per centum of the DFW gross revenues are accounted for by do-it-yourselfers while the other 30 per centum is sold to professional painters. In the other countries outside of the DFW country 90 per centum of gross revenues are accounted for by do-it-yourselfers while the other 10 per centum is sold to professional documents. ( See Exhibit 2 ) . This would means the per centum of the market section is as following: DFW ( $ 48 1000000s ) Non-DFW ( $ 32 1000000s ) We will write a custom essay sample on Jones-Blair Case Anaylsis specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on Jones-Blair Case Anaylsis specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on Jones-Blair Case Anaylsis specifically for you FOR ONLY $16.38 $13.9/page Hire Writer Professional Painters 70 % ( $ 33. 6 1000000s ) 30 % ( $ 9. 6 1000000s ) DIY households 30 % ( $ 14. 4 millions1 ) 70 % ( $ 22. 4 1000000s ) Plan of Action The senior direction squad has examined the pigment industry. particularly the architectural pigment markets. and they have yet to come to a decision. The president of Jones Blair. Mr. Alexander Barrett. is be aftering to hold another meeting with his executive squad where they will each show their suggestions and he has exclaimed a determination must be made. Recommendations Jones Blair executives have developed four options to alleviate the company’s selling job ( which are outlined as follows ) : a ) Cut monetary value by 20 % B ) Spend extra $ 350. 000 on corporate advertisement ; degree Celsius ) Hire one extra gross revenues representative vitamin D ) Do Nothing ( Status Quo ) a ) Cut monetary value by 20 % Compared to other taking national trade names. Jones Blair is priced comparatively high. This is based on the highly high quality and public presentation of the merchandises. By cutting monetary value. Jones Blair will be able to remain competitory in monetary value with other the other merchandises on the market. B ) Spend an extra $ 350. 000 on corporate advertisement This money will be used to increase consciousness. Most of it will be spent on telecasting ads targeted chiefly in the Dallas Fort Worth ( DFW ) country at the do-it-yourself market. Brand image is of import to consumers and telecasting ads are a great manner to acquire their name out. Most of this population is cognizant of this merchandise and merely some of this population would buy it. degree Celsius ) Hire an extra gross revenues representative Hiring an extra gross revenues representative will let Jones Blair to concentrate on new markets. These markets should be outside of the DFW country and let for new metropoliss and provinces to acknowledge Jones Blair. vitamin D ) Do Nothing ( Status Quo ) Since Jones Blair has continually seen net incomes each twelvemonth ; they should keep their current selling aims and make nil. Jones Blair has done an first-class occupation of this in the past by watching the borders and commanding costs. By making nil. the company will non necessitate to pass any extra money. vitamin E ) Alternate Recommendations a. ) Cut monetary value by 20 % In 2004 architectural merchandise gross revenues volume was $ 12. 000. 000. Jones Blair has a current net net income of $ 1. 14 million. and to remain profitable it must keep this sum. $ 12. 000. 000* . 35= $ 4. 200. 000 If Jones Blair reduced its monetary value by 20 % the part border will drop to 15 % . ( $ 12. 000. 000 ) * . 15 = ( $ 1. 800. 000 ) If the company drops the monetary value by 20 % the company will see a 33 % addition in gross revenues. ( $ 1. 800. 000 * . 33 ) = $ 4. 200. 000 ( $ 594. 000 ) Strength: Jones Blair will sell more merchandises. because it will be able to vie with its rivals in monetary value. WEAKNESSES: May non be able to sell plenty in volume to cover cost of goods sold. If the monetary value is more competitory with other companies it may non be looked at as superior quality. b. ) Spend extra $ 350. 000 on corporate advertisement. The selling section proposes a telecasting run targeted at the DFW do-it-yourself market. This will be an extra $ 350. 000. but will significantly increase the consciousness of Jones Blair merchandises. Research has proven that trade name consciousness is a major factor in buying determinations. If Jones Blair does hold to utilize this method the company will necessitate to do at least $ 122. 500 to interrupt even and cover the cost of this new publicity ( $ 350. 000/ . 35= $ 122. 500 ) . Most of the DFW consumers are do-it-yourselfers. so a telecasting ad will be good in this market. Strength: Consumers will go cognizant of Jones Blair. Do-it-yourselfer’s history for 70 % of volume in the DFW country. Ad is proven to increase consciousness. and consciousness is a critical factor in consumer buying determinations. Failing: About duplicating current advertisement costs ( $ 360. 000+ $ 350. 000 ) . This recommendation requires a big budget and has small warrant of consequences b ecause about 75 % of the sing audience does non purchase pigment. Consumer purchasing procedure shows family purchasers choose a shop foremost. non a trade name ; hence. concerted ad is required. non trade name advertisement. c. ) Hire an extra gross revenues representative. Gross saless outside of our place district DFW are important for keeping competition in the market. A gross revenues rep would be the company $ 60. 000 a twelvemonth. So the company would necessitate ( $ 60. 000/ . 35 ) about $ 171. 428. 58 of extra net incomes to cover this. 120 retail merchants are located outside of DFW. If we look at our current dollar sum needed to remain profitable $ 4. 200. 000 and split that by shops $ 4. 200. 000/120= $ 35. 000 So $ 171. 428. 58/ $ 35. 000 = about 5. So the company would necessitate a new gross revenues rep to get at least 5 new histories a twelvemonth to breakeven. STRENGTHS: New clients may convey more chance to the tabular array through word of oral cavity. Doesn’t cost the company a important sum of money to make. WEAKNESSES: Does non assure new clients. It’s merely concentrating on most profitable market. DFW. d. ) Do nil ( Status Quo ) Jones Blair will non alter any of their selling schemes. Strength: Does non be the company any excess money to keep current aims. Jones Blair is presently doing money. why alteration? WEAKNESSES ? Jones Blair will non ever be profitable in the hereafter ; the cost of research and development will merely increase. Needs to remain competitory in the market and non looking into long term vision of the company. Concluding recommendation Jones Blair needs to look into the hereafter and envision the company viing with rivals. Its best stake is to concentrate on the consumers in its chief place market. DFW. If they can derive consciousness of the place market. sooner or later word will distribute throughout all of their markets and concern will din. Making a $ 1. 000. 000 minimal income expressions like pocket alteration. Right now Jones Blair can afford this and still hold a $ 400. 000 net income. Target Market The mark market for Jones Blair is consumers in its chief place market. DFW. Specifically the consumers in their architectural coatings and sundries arena. Marketing Mix Promotion: Jones Blair Company advertisement can potentially hike their patronages conveying more consciousness to the DIY section in the southwesterly country of the United States. This was basically the aim of the executive meeting and advertisement is proven to increase consciousness. and consciousness is a critical factor in most consumer buying determinations. Topographic point: The Company distributes its merchandise through 200 independent pigment shops. timber paces and hardware mercantile establishments. With the expanded advertizements Jones Blair can spread out to their selling range linking with more consumers. particularly in the southwesterly country of the US. Monetary value: About duplicating current advertisement costs ( $ 360. 000+ $ 350. 000 ) . advertisement would be the best manner to make the multitudes in the parts that are traveling unnoticed. Merchandise: Architectural coatings and sundries supplied throughout the southwesterly United States.