Milford Industries Harvard Case Solution & Analysis

Milford industries


Milford Company is the manufacturer of tools and accessories. The company is based in USA and it is one of the world’s largest manufacturing companies of tools and accessories. The revenue of the company in the year of 1982 was $540 million. The company is divided into three different types of sales force, these three separate sales forces sell hand power tools to different customers. Following is the detail of the workforce with the detail of the customers with whom they deal with and the sales contribution by each type of the workforce:

1. The industrial sales force called on large end users, industrial distributors and mill supply houses. This sales force is the largest contributor of the total sales of the company and contributed $234 million in the total sales of the company.
2. The private label sales force is sold to a few large retail organizations such as Sears, Wards, J. C. Penney, and K mart. The private label sales force contributed $96 million to the sales of the company in 1982.
3. The commercial sales force called on all other retailers including department stores, hardware stores, discount stores, and other outlets. The sales contribution of commercial sales force was $210 millionas total sales in the year 1982.
Problem Statement:
The main problems of the Milford Company are the poor performance of Central district with respect to the revenues and profit contribution to the company. The main reason of the issues is the poor performance of district manager and the sales team of the district.

There is also high employee turnover ratio in the district office with low morale of the employees. In addition to this, the lack of control and discipline has also played an important in the deterioration of the performance of the Central district region.

Milford’s Commercial Product Line:

The management of Milford has estimated the market share of 21% with respect to the commercial sales categories in which the company is competing with its competitors in the tools and accessories market in USA. Milford has six types of the product lines in its manufacturing and sales cycle. There are significant differences in the market, sales and manufacturing of these different types of product lines:

Stationary metalworking power tools:

The product line is divided into two different groups. More than half sales of this product line comprises of bench grinders that are used to grind and to sharpen the tools. The retail price of this type of product ranges from about $40 to $220. The remaining sales of this product line include metalworking lathe machines and electric hack saws; these retailed from $300 (simple type of hack saw) to $2000 (lathe). These items of Milford are intended to be for serious home craftsman or the small commercial concern. Milford Company does not consider these items to be highly gift oriented and promotable items.

Stationary woodworking power tools:

This product line of stationary woodworking power tools includes stationary circular saws, band saws, lathes, drill presses, shapers and planers. These types of products are widely used in the wood industry especially in furniture and fixture and fitting sector. The items are retailed for between $250 and $800 and are used by avid hobbyists. Many of these products are promoted as gift items, mainly for Christmas, Chanukah and Father’s Day...............................

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