Harper Chemicals

Topics: Tile, Sales, New product development Pages: 4 (1481 words) Published: April 18, 2008
HARPER CHEMICAL COMPANY
The Harper Chemical Company (HCC) was a medium sized producer of industrial chemicals, which sold its products primarily to customers in the paper industries and the paint industries. In 1980, HCC diversified into the production of a mineral called Dominite. By acquiring the Dominite activities, HCC hoped it would yield at least 15% return on investment after taxes. In early 1980, the HCC board of directors authorised the construction of a processing plant having a 40 000 tons capacity at a cost of $4.5 million. As of the end of 1985, the Dominite operation had accumulated a $75 million before-tax loss and the general management of HCC is confronted with the decision to re-launch or to sell the Dominite operation. The product benefits of Dominite

Dominite can be used as raw material as a replacement for talc in two major industries: the ceramic (55%) and the paint (35%) industries. Dominite can also be used in a wide variety of products (10%) such as cement, insulating materials, plastic floor tiles and certain types of glass.

The ceramic industry
Dominite has a potentially large use as a replacement for talc in making ceramic wall tiles. It could be used in proportion from 2% to 70% of the tile body weight depending on the other materials used, the process employed and the type of tile desired. The strength of the tile could be increased and manufacturing breakage reduced by using Dominite instead of talc. In addition, a Dominite tile had minimal moisture expansion, which lessened the tendency for the glaze to crack in use. Tiles containing 20% or more of Dominite had a low coefficient of thermal expansion, which allowed rapid heating and cooling without cracking. Therefore, tiles made with Dominite could be fired in the kiln in less time than talc tiles (1/2-15 hours for Dominite tiles compared to 18-40 hours for talc tiles). Tiles made with Dominite could also be fired at lower kiln operating temperatures than talc tiles (1800°F...
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