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Jhon's blair

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Masud Shamsul

The document discusses the paint industry and Jones Blair Industrial Coatings. It analyzes Jones Blair's market share, strengths, weaknesses, opportunities, and threats. Several vice presidents propose alternatives for addressing Jones Blair's problem of declining sales. The recommendations are to actively pursue the non-DFW professional market, hire an additional sales representative, seek more retail accounts, provide sales training, and maintain prices while engaging in cooperative advertising.

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Jones.BlairIndustrial Coatings Presented to : Mr. Abu Daud Khan Strategic Marketing (MKT 732) ID-13274003 Presented by : Md Shamsul Alam Masud
U.S. Paint Industry Segment Architectural Coatings Original Equipment Manufacturing Coatings Special-Purpose Coatings % of total industry dollar sales 43% 35% 22% Architectural Coatings General purpose paints and varnishes used on residential and commercial structures OEM Coatings Used for durable goods such as automobiles, appliances, and industrial machinery Special-Purpose Coatings Used for special applications such as bridges, marine applications, and highway and traffic markings Three Segments of Industry:
Jones Blair Headquarters: Dallas, Texas Service Area: 1. Texas, Oklahoma, New Mexico, and Louisiana. 2. Dallas-Fort worth (DFW) area Competition: 600 paint companies in the US 1997: Total sales $ 80million $12 million net sales of Jones Blair architectural paint and allied products
Jones Blair Distribution: 200 independent paint stores, lumberyards, and hardware outlets. 40% of outlets are in DFW area Promotion: 8 sales representatives Salary:$480,000annually 1% commission on sales 3% of net sales spend for advertising & sales promotion efforts
What do you think Jones Blairs problem is?
Problem Where and how does Jones-Blair Company deploy corporate marketing efforts among the various architectural paint coatings markets in their service area Should they target: Professionals or Do-it- yourselfers? Where should they target: Dallas Fort Worth or Non DFW? How are they going to accomplish this?
Internal Strengths Experience Founded in 1928 Strong relationships between sales representatives and retail stores High quality Sell to both professionals and DIYers Cooperative advertising with retailers Motivated, determined and passionate A lot of research available Low Break Even - Excel
Only 3% of net sales goes to advertising Ads only reach and influence 25% of target CGS is 60% of net sales Only 8 sales representatives Narrow market penetration in DFW area. No exclusive rights with retailers Highest price in market Internal Weaknesses
External Opportunities Market Growth: 1-2% per year Distributed to 200 of the 1,000 retail outlets in the area 40% of these retailers are in rural areas DIY painters first choose a retail outlet for paint and sundries then choose a paint brand. Pro-painters are frequent buyers and look for paint that is high quality, durable and easy to clean up The average dollar paint purchase per purchase occasion: $74.00. Average of $12.00 on sundry Market Growth 2000 2001 2002 2003 $80,000,000 $80,800,000 $81,608,000 $82,424,080
600 different competitors Competition is spending more on advertising Competition is less expensive Major in-house retailers have little knowledge DIYers purchase paint once every four years and get whats convenient and inexpensive Contractors want paint for the lowest price. Demand effected by substitutes, long lasting products and VOC regulations External Threats
Total Market $80 Million Net Sales Professional DIY Urban $48,000,000 60% $14,400,000 30% $33,600,000 70% Rural $32,000,000 40% $3,200,000 10% $28,800,000 90% $14,400,000 $33,600,000 $3,200,000 $28,800,00 0 Total Market Urban Professional Urban DIY Rural Professional Rural DIY
Market Share Professional DIY Urban 18% 42% Rural 4% 36%
What do you think Jones Blairs distinctive competencies are? Hint: There are 2!
Core Competencies Quality Best on the Market 1 Coat Coverage Mildew & Stain Resistant Pleasant Fragrance 1000s of Colors Good fit with professional painters Service Sales Representatives Well Liked Helpful Professional Knowledgeable 1st name basis with customers Discuss both Business & Family Run the Store Good fit with rural area
Alternatives 1. Increase advertising dollars by $350,000 and use it for TV ads 2. Have an overall 20% price cut 3. Add one more sales representative 4. Continue to guard margins and control costs 5. President Barretts suggestions 1. Ad dollars used for print media instead of TV 2. 40% price cut to attract contractors
Which Alternative Do you think is the best for Jones Blair ?
VP of Advertising Direct efforts to Dallas Fort Worth-DIYers Increase awareness to 30 % Advertising Increase of $350,000 Television Coverage in 15 Counties
Pros/Cons Pros Low added costs compare to competitors Extra $350,000 Break Even: $3,400,000 Increased Awareness Cons Almost doubling the advertising cost. 75% of audience is not buying paint
VP of Operation Advertising isnt right way. Need to be competitive in DIYers Consumers are Price Sensitive Cut Price by 20%
Pros/Cons Pros Competitive Price Gain Market Share In DIY Sectors Cons Break Even: $4,480,000 Huge break even Lowers perception of quality
Vice President of Sales Target: Non-DFW areas Where 遜 of the sales and most dealers exist right now Solution: Add another sales rep There are already 8 This rep would develop new retail account leads and call on professional painters to solicit their business through our dealers Cost to add another sales rep is $60,000
Pros/Cons Pros Motivated to inspire team Potential for success Large Market Break Even: $2,571,429 Not affected too much Cons Overlooked the DFW area Sales reps arent that effective for immediate breakthrough.
Vice President of Finance Keep everything the same Continue to guard margins and control costs
Pros/Cons Pros Not Risky Keep doing what company does best Cons Doesnt solve the problem Not a result oriented approach.
President Barrett 40% price cut to attract contractors Redirect Advertising print media instead TV Newspaper & Catalogs. Focus to Rural
Pros/Cons Pros Attractive for contractors More Focused Advertising can cover widespread. Cons Increase cost for competitive bidding Constant Loss Break Even: -$14,280,000
Normal Vp of Sales Vp of Advertising Vp of Operations President & CEO -16000000 -14000000 -12000000 -10000000 -8000000 -6000000 -4000000 -2000000 0 2000000 4000000 6000000 1 2400000 2571428.571 3400000 4480000 -14280000 AxisTitle Break Even Analysis Normal Vp of Sales Vp of Advertising Vp of Operations President & CEO
Why Rural Professional Competitive Advantage: Good Service & High Quality Good Fit: On a 1st name basis with store owners Control 45% of the market by professionals painter. Best Bang for the Buck
Recommendation Actively pursue non-DFW Household and Professional markets. Hire one additional Representative NOW! who is incharge of new account development. Seek more retail accounts in non-DFW markets. Sales Training Kick their butts into gear Clarify Roles New focus: Rural Professional Painters Increase personal sales by 5%
Recommendation Maintain prices, reduction in the price may be boomerang effect. Engage in cooperative advertising with current advertising budget.
Questions? Comments? Concerns?

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Jhon's blair

  • 1. Jones.BlairIndustrial Coatings Presented to : Mr. Abu Daud Khan Strategic Marketing (MKT 732) ID-13274003 Presented by : Md Shamsul Alam Masud
  • 2. U.S. Paint Industry Segment Architectural Coatings Original Equipment Manufacturing Coatings Special-Purpose Coatings % of total industry dollar sales 43% 35% 22% Architectural Coatings General purpose paints and varnishes used on residential and commercial structures OEM Coatings Used for durable goods such as automobiles, appliances, and industrial machinery Special-Purpose Coatings Used for special applications such as bridges, marine applications, and highway and traffic markings Three Segments of Industry:
  • 3. Jones Blair Headquarters: Dallas, Texas Service Area: 1. Texas, Oklahoma, New Mexico, and Louisiana. 2. Dallas-Fort worth (DFW) area Competition: 600 paint companies in the US 1997: Total sales $ 80million $12 million net sales of Jones Blair architectural paint and allied products
  • 4. Jones Blair Distribution: 200 independent paint stores, lumberyards, and hardware outlets. 40% of outlets are in DFW area Promotion: 8 sales representatives Salary:$480,000annually 1% commission on sales 3% of net sales spend for advertising & sales promotion efforts
  • 5. What do you think Jones Blairs problem is?
  • 6. Problem Where and how does Jones-Blair Company deploy corporate marketing efforts among the various architectural paint coatings markets in their service area Should they target: Professionals or Do-it- yourselfers? Where should they target: Dallas Fort Worth or Non DFW? How are they going to accomplish this?
  • 7. Internal Strengths Experience Founded in 1928 Strong relationships between sales representatives and retail stores High quality Sell to both professionals and DIYers Cooperative advertising with retailers Motivated, determined and passionate A lot of research available Low Break Even - Excel
  • 8. Only 3% of net sales goes to advertising Ads only reach and influence 25% of target CGS is 60% of net sales Only 8 sales representatives Narrow market penetration in DFW area. No exclusive rights with retailers Highest price in market Internal Weaknesses
  • 9. External Opportunities Market Growth: 1-2% per year Distributed to 200 of the 1,000 retail outlets in the area 40% of these retailers are in rural areas DIY painters first choose a retail outlet for paint and sundries then choose a paint brand. Pro-painters are frequent buyers and look for paint that is high quality, durable and easy to clean up The average dollar paint purchase per purchase occasion: $74.00. Average of $12.00 on sundry Market Growth 2000 2001 2002 2003 $80,000,000 $80,800,000 $81,608,000 $82,424,080
  • 10. 600 different competitors Competition is spending more on advertising Competition is less expensive Major in-house retailers have little knowledge DIYers purchase paint once every four years and get whats convenient and inexpensive Contractors want paint for the lowest price. Demand effected by substitutes, long lasting products and VOC regulations External Threats
  • 11. Total Market $80 Million Net Sales Professional DIY Urban $48,000,000 60% $14,400,000 30% $33,600,000 70% Rural $32,000,000 40% $3,200,000 10% $28,800,000 90% $14,400,000 $33,600,000 $3,200,000 $28,800,00 0 Total Market Urban Professional Urban DIY Rural Professional Rural DIY
  • 12. Market Share Professional DIY Urban 18% 42% Rural 4% 36%
  • 13. What do you think Jones Blairs distinctive competencies are? Hint: There are 2!
  • 14. Core Competencies Quality Best on the Market 1 Coat Coverage Mildew & Stain Resistant Pleasant Fragrance 1000s of Colors Good fit with professional painters Service Sales Representatives Well Liked Helpful Professional Knowledgeable 1st name basis with customers Discuss both Business & Family Run the Store Good fit with rural area
  • 15. Alternatives 1. Increase advertising dollars by $350,000 and use it for TV ads 2. Have an overall 20% price cut 3. Add one more sales representative 4. Continue to guard margins and control costs 5. President Barretts suggestions 1. Ad dollars used for print media instead of TV 2. 40% price cut to attract contractors
  • 16. Which Alternative Do you think is the best for Jones Blair ?
  • 17. VP of Advertising Direct efforts to Dallas Fort Worth-DIYers Increase awareness to 30 % Advertising Increase of $350,000 Television Coverage in 15 Counties
  • 18. Pros/Cons Pros Low added costs compare to competitors Extra $350,000 Break Even: $3,400,000 Increased Awareness Cons Almost doubling the advertising cost. 75% of audience is not buying paint
  • 19. VP of Operation Advertising isnt right way. Need to be competitive in DIYers Consumers are Price Sensitive Cut Price by 20%
  • 20. Pros/Cons Pros Competitive Price Gain Market Share In DIY Sectors Cons Break Even: $4,480,000 Huge break even Lowers perception of quality
  • 21. Vice President of Sales Target: Non-DFW areas Where 遜 of the sales and most dealers exist right now Solution: Add another sales rep There are already 8 This rep would develop new retail account leads and call on professional painters to solicit their business through our dealers Cost to add another sales rep is $60,000
  • 22. Pros/Cons Pros Motivated to inspire team Potential for success Large Market Break Even: $2,571,429 Not affected too much Cons Overlooked the DFW area Sales reps arent that effective for immediate breakthrough.
  • 23. Vice President of Finance Keep everything the same Continue to guard margins and control costs
  • 24. Pros/Cons Pros Not Risky Keep doing what company does best Cons Doesnt solve the problem Not a result oriented approach.
  • 25. President Barrett 40% price cut to attract contractors Redirect Advertising print media instead TV Newspaper & Catalogs. Focus to Rural
  • 26. Pros/Cons Pros Attractive for contractors More Focused Advertising can cover widespread. Cons Increase cost for competitive bidding Constant Loss Break Even: -$14,280,000
  • 27. Normal Vp of Sales Vp of Advertising Vp of Operations President & CEO -16000000 -14000000 -12000000 -10000000 -8000000 -6000000 -4000000 -2000000 0 2000000 4000000 6000000 1 2400000 2571428.571 3400000 4480000 -14280000 AxisTitle Break Even Analysis Normal Vp of Sales Vp of Advertising Vp of Operations President & CEO
  • 28. Why Rural Professional Competitive Advantage: Good Service & High Quality Good Fit: On a 1st name basis with store owners Control 45% of the market by professionals painter. Best Bang for the Buck
  • 29. Recommendation Actively pursue non-DFW Household and Professional markets. Hire one additional Representative NOW! who is incharge of new account development. Seek more retail accounts in non-DFW markets. Sales Training Kick their butts into gear Clarify Roles New focus: Rural Professional Painters Increase personal sales by 5%
  • 30. Recommendation Maintain prices, reduction in the price may be boomerang effect. Engage in cooperative advertising with current advertising budget.

Editor's Notes

  • #4: Jones Blair is a privately held corporation that produces and markets architectural paint and sundries Service area: Over 50 counties in Texas, Oklahoma, New Mexico, and Louisiana. The 11 county Dallas-Fort worth (DFW) area 1999: $80 million of architectural paint and allied products sold in Jones-Blairs 50-county service area JONES-BLAIR Service Centers 2728 Empire Central Dallas, TX 75235 (214) 353-1681 Phone (800) 325-6321 Fax Customer Service 5201 Spruce Bellaire, TX 77401 (713) 661-9865 Phone (713) 667-9143 Fax Eddie Gamez, Store Manager bellaire@jones-blair.com 801 Riverfront Pkwy. Chattanooga, TN 37402 (423) 634-7734 Phone (423) 267-9713 Fax Steve Goodwin, Store Manager chattstore@jones-blair.com 9289 E. Park Ave. Houma, LA 70360 (985) 580-0020 Phone (985) 580-0038 Fax Brad Price, Store Manager houmasc@jones-blair.com 4419 97th Edmonton, Alberta T6E 6W6 (780) 430-7665 Phone (780) 430-7853 Fax David Melara, Store Manager edmontonsc@jones-blair.com
  • #5: There is $50,000 paint and sundry purchases in both DFW area and Non-DFW area annually.