Loctitle Corporation Harvard Case Solution & Analysis

Introduction

Evidently, Loctitle Corporation is engaged in the marketing anddevelopment of the sealants and adhesive for numerous consumer and industrial application. The ultimate goal ofthe company is to gain maximum market share through becoming marketer of adhesive and to position itself in the competitive arena.

The company has been contemplating to launch the Bond-A-Matic 2000 (BAM) so that it would be able to facilitatethe objective of the IPG of leveraging year-on-year sales of the super bonder adhesives and to attain a maximum market share within CA market.

Customer-Analysis

In the fiscal year 1978, SuperBonderadhesive have captured anindustrial market share of approximately 35%for CA. While the sales in the CA tends to be growing and increasing by more than 20% per year. If Loctitlewould be able to sustain its growth in the market, it would no longer be difficult to reach its targeted goal of increasing the sales in 1979 by 28% to $4.5m.

Within CA, the industrial segment was highly fragmented and the size of the firm is supposed to be a poor predictor of the CA demand, more than 50% of the IPG’s current sales of the SuperBonder adhesive came from the distributor group who are engaged in selling to either small or medium OEMs. With only 16% of the company is using instant adhesive, Loctitlecould expand the market size and create primary demand amongst customers as well as also increasingmarket share. Loctitle should have to educate the market about many uses and application of SuperBonder as it is the leader in growing and young industry. The company should avoid to market the BAM 2000 as standalone product it should be market as complimentary to theSuperBonder adhesives.

Loctitle Corporation Harvard Case Solution & Analysis

The company should also focus on production and plant engineers and precedents in SIC industry groups 35-39 at small to medium sized firms, the groups that uses instant adhesive between 1 and 9 pounds annually. Currently, this segment includes 8997 firms with a potential and capability to grow to 14763 firms based on the estimates of industry given in the case.

GroupSIC 35-39 Moderate UseSIC 35-39 Heavy UseSIC 35-39
Current Users Establishments8997341331023
New Potential User Establishments5766218719883
Total14763560050906

 

If the market would be segmented in this way would allow the company to use BAM 2000 in order to introduce instant adhesive to new users and the company would react to the users of SuperBonderby improved dispensing technology.

The industries are characterized by the usage with strong opportunity as to convert additional non-users in the forthcoming years.Theirproducts are subject to production process and design changes are better suited for BAM 2000. It would provide its users with greater control, precision, efficiency and reliabilitywhile theywork.

CompanyAnalysis

The role of the BAM is inevitable, the system division had developed BAM 2000 so that the need of the different type of user can be fulfilled. By increasing the reliability and precision of the available equipment to assembly line worker, the BAM 2000 had played directly to the unique competitive advantage of the system division. Purposely, innovative and high quality designs and it would drive the growth of the IPG into the markets in the forthcoming years..................

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