Background and situation
Soren Chemical produces industrial strength cleaning solutions, lubricants and fuels, as well as other chemical solutions for treating drinking water and waste water. Since its founding in 1942, Soren has operated mainly as a business-to-business company with minimal focus on product and brand awareness. They recently introduced Coracle, a pool water clarifier used in small recreational and household swimming pools, which was met with dismal sales results. Having targeted 100,000 units for the first year, they only managed to sell 7,450 units thru first half of the year. The market, however for large-scale, commercial-use clarifiers is estimated to be $30 million in 2007. Their other product, Kailan MW, has enjoyed a healthy growth in the commercial and large-scale application market. There is even bigger potential for small sale, residential and recreational use pool water clarifiers. To improve sales it needs to strategize in various areas as in making the distributors to push the product, create shelf space, and have the consumers aware of the cost benefits of Coracle. It needs to assess whether their product can compete in the existing market and find most means for increasing distribution. In fact, the market for coracle is more fragmented. There are over 9 million residential swimming pools that require regular maintenance. 80% of the pool owners maintain their own pools and purchase their supplies from retailers and local specialty stores. Most pool equipment and cleaning agents are sold via two-step process – to distributors which then supply to retailers and service professionals. Some manufacturers, it is noted, bypass this channel and sell directly to mass merchandisers and specialty stores. The lack of communication and targeted approach is evident since specialty stores inquire about coracle but only 30% receive the information materials. Furthermore 70% state that coracle is not offered by the...
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