Cumberland Case

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fter testing the curled metal pads, Colerick Foundation Company and Fazio Construction are aware of the value added benefits and cost savings involved in the use of CMI pads and are eager to buy. These two companies are a perfect example of the makeup of the most profitable customer, the Independent pile-driving contractor. They are the frontline of the buying influence, and once that they are aware of the value added this product provides they can easily become our most profitable segment. It is essential that CMI supply the companies that tested the coil pads with this product, before they seek an alternative manufacturer to develop the relatively “unsophisticated” product. This now brings the implication that CMI’s easily duplicated product is lacking a patent. CMI should focus its attention in acquiring a patent prior to mass distributing the coil pads. When considering pricing, the perceived value pricing should be the driving force for their CMI’s sales teams. (Advertising and sales campaign) Taking into account the supply limitation of only 9,000 units per year, increased pile driving speed, efficiency, cost savings, and lack of competitors in the industry, CMI will price the pads at $500 per unit. At this price the break even point is achieved after selling 1481 units. A perceived value pricing strategy is the driving force for CMI’s sales teams. The fact that the piles can be driven at a faster time for less money should be a convincing argument for our most profitable customer. Specific selling points are that by using CMI’s curled metal pads, piles can be driven in less time, 33% faster than the asbestos pads and they last for the entire job allowing for significant cost savings on the customer’s side. CMI should provide the sales team with the results of the two tests to provide backing to their value added pricing. Manufacturing sales representatives can be used to sell and distribute our product to other pile hammer manufacturers and contractor...
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