Case History Conclusions

Case History Conclusions

Case History Conclusions

The significance of this piece of information, of course, is that a market growth of only 4 per cent is less than Elephantine's existing growth rate of S per cent.

From their interviews with both customers and distributors, the researchers have discovered that Elephantine's products are well received as being of good and consistent quality. The company's prices are relatively high and Elephantine is considered less flexible in its pricing policies than its competitors. Super-Colossal and Agile Industries show a greater willingness to negotiate or offer discounts against quantity orders. A further criticism of Elephantine is that it takes too long to provide quotations, thus making it difficult for its customers to place regular business.

On the question of Elephantine's sales representatives, there is a general view that they are all pleasant, solid fellows who know their products but lack a sense of urgency. Because of the pedestrian pace maintained by the sales department generally, it is felt that many opportunities are missed. Elephantine is considered far superior to its competitors on technical service but a considerable number of respondents have said that its delivery service is slow. Although their delivery promises are reliable, their delivery dates are generally longer than those of Super-Colossal and always longer than those of Agile.

From these various findings a general picture is emerging. Here is the Elephantine Company, still leading its market, highly respected as a producer of quality merchandise but in danger of dozing off too often into complacency. Still some way behind, but gaining ground, we have the Super Colossal Company, another old-established firm of good repute, which is gradually increasing its share of the market on the basis of having acceptable products and offering a good service. Finally, we have the smallest firm in the market, youthful Agile Industries, a little brash in its approach, but resourceful, quick to grasp its opportunities and coming up fast.

In presenting their recommendations, the SEO consultants are obviously stressing Elephantine's vulnerability. Its market share has dropped from 85 per cent to 55 per cent in ten years. With the anticipated fall-off in the market growth rate, the company may suffer shortly a fall in absolute sales as well as in market share.

The organization needs a shake-up. The sales department, particularly, needs close examination to find out why it has failed to take its share of the new business which has occurred in the market in recent years and also why it has failed to ensure that an adequate delivery service is provided for its customers.

Production methods and the scheduling of orders and their delivery needs to be looked at. The company's pricing policy, too, requires urgent examination with a view to the introduction of greater flexibility to meet competition.

This examination has, necessarily, been brief. However, it does illustrate how market research can play a valuable part in a not untypical business situation. To their credit, the directors of Elephantine were not unaware that something was amiss. They realized that something needed to be done to safeguard the company's position but, without much knowledge and experience of market research techniques, they did not know how to pin-point the trouble and establish its cause. Because market research did a thorough and effective job, there is still time, now the true facts are known, for remedial action to be taken.




Next Step: - The Price Policy



Please Note

The Trade is, of course, a major source of product ideas. All manufacturers examine, with avid interest, the new products of their competitors.

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