Curled Metal

Topics: Costs, Marketing, Price Pages: 13 (3518 words) Published: May 21, 2012
Curled Metal Inc (CMI) is a company whose strategy evolves selling products that used certain types of metal as a raw material. CMI rapidly grow in the last decade due to Slip-Seal, a product that meet the demanding specification of the automaker imposed by US strict environment legislation. In order to diversify offer from auto industry, CMI’s management decided to examine a new application for curled metal technology.

Situation Analysis
Business Model and Competitive Strategy
In the beginning CMI fabricated custom components for chemical process filtration and other highly technical applications. The boost came when Slip-Seal was developed and gained 80% of market share. Sales increase from $750k in 1991 to $55M in 2007 but comparing 2006 to 2007 the net sales decrease 9,5% and the net income decrease 38,7%. CMI need a new product to increase sales and net income. CMI developed curled metal cushion pads that according to Joseph Fernandez, vice-president of the Engineered Division, can double CMI sales.

Competitive Advantage
Cushion pads are traditional made from hardwood blocks, aluminum plate and micarta slabs,micarta slabs or phenolic plastic. They were difficult to find, heat up, have low resistance and were difficult to substitute. CMI’s cushion pads are made from Curled metal. Curled metal was continuous metal wire that was wound into tight, continuous ringlets. They can be made of various materials (e.g., cooper, monel and stainless steel) and withstand almost any temperature or chemical which made possible to handle with protective gloves immediately after being used. CMI has the advantage to perform flattening and curling operations in-house and it is possible to create custom made pads up to 30 inch. CMI’s cushion pads are also thicker than conventional ones and have a coat with polyvinyl chloride to enhance its appearance.

Needs Analysis
Despite cushion pads importance to pile-driving process, little attention had been paid to them by most of the industry. Everyone used them and took them for granted, but no one attempted to improve them. Customers need a cushion pads that performance better. A cushion pad should be durable, time-saving, easy to transport (light) and secure (do not heat and use hazard products).

Decision Making Process
CMI analyzed pile-driving business and identify the following influencers/buyers: * Pile hammer manufactures: Would not purchase large volume but can influence recommendations * Architectural/Consulting engineers: Would not buy but are key influence on purchasing decisions * Soil consultants: Similar to architectural/consulting engineers but consulted in extraordinary conditions * Pile hammer distributing/renting companies: Often include first set of pads for free but might hesitate to provide CMI pads because they can enable contractor to return hammers faster. * Engineering/Construction contractors: Participate in bigger and more sophisticated jobs. To get this type of customers CMI would have to solicit this group actively on a very sophisticated level. * Independent pile-driving contractors: Primary objective was to make money and are very knowledgeable about the practical aspects of pile driving but not very managerially sophisticated. * University professors: Potential influencer because sophisticated engineering/construction firms and many architectural/consulting engineers are familiar with this work and helped supports it.

There are virtually no competitors. Aluminium plate and micarta stabs were not fabricated (were handmade). In 2008 micarta slabs and some phenolic plastic were the conventional pads and there is no information about the market and competitors. Most of the pads are provided to the market unbranded.

SWOT Analysis
Strengths: New product with better performance (faster and more resistant) than similar products Weaknesses: Because product performs better, it...
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