Alto Chemicals Europe Harvard Case Solution & Analysis

Evaluate the actions taken so far by Graaff to implement his strategy. What should he do next? Why

The actions taken by Graaff to improve the sales for the company include the following aspects. Graaff implemented the following steps in the sales plan to increase the profit volumes.

Non-price selling

The idea of non-price selling was to gain competitive advantage from ACE through its expert sales force, superior technical service, and general corporate reputation for supplier reliability. This was a good move to actually make companies and customers realize that the slightly higher prices are based on extra and high-quality services.

New Accounts

Previously the sales force was dependant on already developed customers and were not concerned in making new customers, therefore Graaff insisted them to actually attract medium and small-sized firms which were less price sensitive and were willing to pay better prices.

Price Leadership

The sales team was more concerned with the prices of Barium based on which they quoted prices, with Graaff the strategy was changed and focused on price leadership that will make the industry drive according to the ACE prices.

Central Co-ordination

The plan was to make Geneva set prices and volume targets for subsidiaries, where competitive low prices were to be given less sales emphasis so that most revenue is generated through Geneva market.

Basically he should implement the new plan because not only will it engage existing customers to do excessive business with the company but will also increase the number of clients along the way. In order to motivate sales force Graaff should increase the sales commission for the sales team and give bonus more than the salary on achieving their respective targets. By doing so, Graaff will be able to achieve his desired goal of changing customer mix which will allow price leverage in the long run......................................

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