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The executive group of Jones-Blair Company needs to decide where and how to deploy corporate marketing efforts among the various architectural paint coatings markets served by the company in the southwestern United States. Specifically, this area is defi

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Introduction

Cover Sheet Statement of the Problem: The executive group of Jones-Blair Company needs to decide where and how to deploy corporate marketing efforts among the various architectural paint coatings markets served by the company in the southwestern United States. Specifically, this area is defined as the 11 counties making up the DFW area and the 39 Non-DFW counties. This is the most important problem stated in the case because all the details directly or indirectly support this problem statement, and the various vice presidents of the company have met numerous times to come to a consensus regarding this issue. It is critical to decide who they should target, which areas to target, and how they are going to target the selected group/groups. Situation Assessment: Jones Blair performed well in 2004, but since they are now the highest priced paint in their service area, their performance and overall profitability in 2005 will rely heavily on where and how they allocate their marketing resources. Overall architectural paint sales are expected to increase 1-2% this year. With a conservative estimate of 1.5% growth on top of the $12 Billion dollar paint and sundries market for 2004, the result will be a $12.18 Billion market for the entire U.S. ...read more.

Middle

Hence, recouping the 350K within one year's timeframe seems highly probable and potential for significant increases in profits is strong. Financially speaking, the VP makes some points in his proposal that could make people question his credibility (This is why his stated Contr. Margin of 35% is suspect, in my opinion). Evaluating his suggestion of maintaining the status quo results in Jones Blair's potential to lose market share. Since the company is already maxing out on their price point, they need to somehow combat increased R&D expenditures along with material/labor costs. "Doing nothing" ignores this and completely neglects capitalizing on the growth of DIY'ers and the Non-DFW areas. This in turn gives competitors an advantage in gaining additional market share. The only sensible thing to do is to focus the marketing budget on areas of high growth potential, and the VP's proposal ignores this. Therefore, the concept of maintaining the status quo should not be supported by Jones Blair. Overall, the president raises some very good points when it comes to his quick evaluation of proposals currently on the table. These are further addressed in the analysis section. ...read more.

Conclusion

Architectural Paint Sales (2005 numbers estimated conservatively Figure 7 - Number of Paint Companies Figure 8 - Breakdown of Where Paint is Sold Figure 9 - Anticipated Sales by Group for 2005, (assuming 1.5% growth from previous year) Figure 10 - Arch Coatings, per Use Figure 11 - Average $ Spent on Paint and Sundries, per Purchase Occasion Figure 12 - Consumer Buying Decision Process, for Home Improvement Products Figure 13 - Counties that Jones Blair Markets to Figure 14 - Number of Relevant Stores in DFW and Non-DFW Areas Figure 15 - Lumberyards/Hardware Stores/Paint Stores - Sales Volume Figures Figure 16 - Jones Blair Income Statement, both assuming VP is correct and incorrect with his CM statement. Figure 17 - Sales Growth, by Year for Jones Blair Figure 18 - Jones Blair Distribution Breakdown Figure 19 - Average Sales per Store Breakdown Figure 20 - Advertising/Sales Promotion Breakdown Figure 21 - Proposal #1 Figure 22 - Proposal #2 Figure 23 - Proposal #3 Figure 24 - Proposal #4 Figure 25 - Suggestions from President Barrett Figure 26 - % of DFW Population Awareness of Paint Brands/Purchased Paint, < 12 months Figure 27 - Expanded Exhibit 2 from Book - Arch Paint/Sundries Sales Volume (in Millions of $) Figure 28 - Breakdown in Percentages and Sales ?? ?? ?? ?? 0 ...read more.

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