Jones Blair Case

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Jones Blair Case

SWOT Analysis:
•High quality products
•High quality service with
•Knowledgeable sales representatives that know customers personally •Mature market 1-2% sales growth long-term
•Shelf goods 43% of total industry dollar sales
•Specialty paint stores & lumberyards most frequently patronized •Distributes through 200 independent paint stores
•Maintaining margins while increasing R&D, material, & labor costs •Market to major business/financial center (DFW)
•Total sales/year increasing dollars sales rate 4% each year Weakness
•Slow sales growth
•Reduce emissions of volatile compounds
•Compliance w/ EPA = low profit margins
•Presence in DFW do it yourself market, in-home centers
•Non-DFW market
•New accounts, only added 5 in last 5 years
•High costs for product
•DFW Sales decreased
•Paint gallon-age hasn't changed in years
•Highest priced paint in service area, especially in DFW
•Awareness of the company
•Need to increase customer awareness by 30%
•Increase demand for paint sundries due to trend towards do it yourself painting •Interior more popular than exterior
•Expand beyond paint
•Primarily in DFW area, so advertising outside of DFW
•Increase advertising over all mediums, catalogs etc
•Develop new retail accounts leads and penetrations
•Professional painters could solicit business to them
•Discount coupon offers on every purchase after first to build loyalty •Increase contractor sales
•Number of paint companies are declining at a rate of 2 to 3% a year •US Paint industry is maturing, over $13 billion in 1997
•Research & design= low profit margins
•Customers choose store first, then brand
•Companies like Wal-Mart becoming bigger
•Competition from cheaper paint brands
•More options besides painting
•Competition in DFW market
•Competition in non-DFW market
•Sherwin Williams, Benjamin Moore, Sears, Kmart, Home Depot etc., strong brand names & retail department have recently increased competition

•Compliance with governmental regulations is partially responsible for the merger and acquisition activity in the U.S. paint industry since 1990 Economic
•The EPA proposed plan for 25% reduction of VOC in 1996, 35% in 2000, and 45% in 2003, furthering the low profit margins in the paint industry Social
•Do-it-yourself painters first choose a retail outlet for paint and paint sundries, then choose a paint brand •4 Step Buying decision process: decide on project/product, gather information (first from friend/relatives), decide on store, and then decide on product Technology

•New distribution strategy
•Lack of available technology and the difference in paint formulations for regional climatic needs, a small number of regional paint manufacturers can successfully compete against the nationally distributing paint manufacturers

3 C's:
•200 independent paint stores, lumberyards, & hardware outlets •40% of outlets in the DFW area
•Markets paint & sundry items in over 50 states including Texas, Oklahoma, New Mexico, & Louisiana Competitors
•60% of sale in architectural coating segment go to Sherwin-Williams, Benjamin Moore, the Glidden unit of Imperial Chemicals, PPG Industries, Valspar Corporation, Grow Group, and Pratt & Lambert •50% of sales in the architectural coatings are sold under private controlled, or store brands in Sears, Kmart, Wal-mart, and Home Deport •Retail outlets outside the DFW area with paint and sundry purchases exceeding $50,000 annually carry only this product line. •Only 14 outlets in DFW carry the Jones/Blair line exclusively, other carry two or three lines of which Jones Blair is most expensive. •All other brands in the service area are cheaper than Jones/Blair. Company

•Architectural paint & allied product sales volume in 1997 was $12 million & new profit before taxes was $1140000 •Dollar sales had increased at an average annual rate...
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