The Profit-Making Allure of Product Reconstruction Harvard Case Solution & Analysis

Product reconstruction, which covers a continuum of activities from processing to reconstruct, to processing, allows the company to sell high-performance products at a lower price than similar new products at the same time realizing higher profits. Product reconstruction can open up new markets for the company to meet the needs of one or more of the six types of clients: those who need to maintain a certain product because it is technically a part in their current processes, end-users who want to avoid the need to respecify, reapprove or re- certification of products, customers who make a low use of the new equipment, those who wish to continue to use the product, which was withdrawn by the original manufacturer, the people who just want to extend the life of used products, whether or not terminated, and the customers who are interested in environmentally friendly products. Per serving a particular market, the company must also have certain kinds of expertise. To succeed in the processing, for example, he should be familiar with the process that originally created the product, to be able to do extensive and labor-intensive sales efforts (to help effectively compete with many other companies in the low barriers to entry, industry) and be willing to specialize, given that certain materials vary greatly in complexity, time requirements, predictability, capital and labor characteristics and flow. "Hide
by John A. Pearce Source: MIT Sloan Management Review 9 pages. Publication Date: April 1, 2009. Prod. #: SMR313-PDF-ENG

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