How might one describe the product-market matrix for Toucon’s products?
There are two types of products sold by Toucon. On the one hand there are the original artifacts mostly bought by truly knowledgeable collectors. The import and distribution of those artifacts are Toucon’s original business and account for the majority of total sales. Over the years Toucon has gained the reputation as a serious and reliable dealer in this field. On the other hand Toucon started selling replicas of artifacts in the mid-1990s. This was a reaction to the growing demand of replicas, especially by gift buyers and people looking for decorative items. The overall market for artifacts and replicas has grown over the last decade. At the same time many new competitors have entered the market. Because of that Toucon faces supply problems and decreasing gross margins.
How would one define Toucon’s business?
Toucon operates in a very particular market in which reliability is a key factor to success. Its main business is still the import of original artifacts. Therefore, Toucon has chosen a few exclusive distribution channels (speciality dealers, firm-sponsored showings, exclusive department store), so it can control the quality of its products in order to maintain its reliability. The business has been around for about 100 years which also helped to establish a national reputation as one of the most respected importers of artifacts. Toucon’s annual sales average about 25 million USD and have constantly been growing at a rate of 20% over the last decade.
How would the mass merchandiser’s offer affect Toucon’s business definition?
The offer of the mass-merchandise department store includes a mandatory raise of replicas. This increase will have an impact on Toucon’s business definition. So far, Toucon has focused on selling unique products to a relatively small group of customers. If it accepted the offer, the business definition would...