| Company Background
| Product (Description and Cost Analysis)
| Focus Groups
| Strengths and Weaknesses
* Written By:-
William A. Preshing
* Primary Focus:-
Segmentation, Targeting, Positioning. * Secondary Focus:-
Channels and Channel Management, Pricing Strategy. * Task Identification:-
To Develop a Strategy for an unchanged market.
Mr. Tanner owned the Tanner Company, which operated three businesses in western Canada – a peat moss company, a mini-warehouse operation, and a landfill site. While attending a new business seminar, he met the inventor of Therm-eze and, after considering investigation, paid $250,000 for the Canadian manufacturing and distribution rights. Mr. Tanner also obtained a patent on the product in Canada which would last 17 years. Shortly after obtaining the rights to Therm-eze, Mark Tanner hired Richard McKay as a salary of $40,000 per year as the marketing manager. He had extensive sales experience, including the introduction of a number of new products to the Canadian market. Mr. McKay's first assignment was to conduct an analysis of the market potential for Therm-eze.
PRODUCT (Description and Cost Analysis)
* Three different sizes: 8” X 18”, 8” X 8”, 4” X 4”. * It was planned in two different temperature settings: 117 and 130 degrees F. * The Pad could be reused by Autoclaving it in Chemicals. * Usage of Felt Covers for preventing rapid loss of heat.
* How It Works?
Thermo-Pad is a heat storage device that utilizes the science of super cooled fluids to produce heat. If you have ever watched a cold bottle of pop freeze when opened, you have experienced the instant phase change of a super cooled liquid. If you could measure the temperature of the liquid before opening, you would see that the ice is warmer than the liquid. When Thermo-Pad is in its liquid state and at room temperature, it is a super-cooled fluid. When the metal disc in the pad is flexed, the pad freezes (crystallizes) and generates heat. Thermo-Pad uses the food grade salt sodium acetate which freezes (crystallizes) at 54o C (130o F) and can be super cooled in a sealed container to as low as -5o C (23o F). By flexing the metal disc in the pad, the super cooled liquid is made to freeze (crystallize) and the temperature of the pad increases to its freezing point of 54o C. The Thermo-Pad will eventually cool and must then be recharged in order to return the crystals to their super cooled state. Recharging is accomplished by simply melting the crystals and allowing them to cool. Although this can be done in a variety of ways, the simplest and safest method is by boiling the pad until all the crystals are melted. Another method for those of you who have newer dish washers is to put the pads on the top rack and run them through on the "sani cycle". When the pad is completely liquid allow it to cool and it is ready to use again. This process of melting and activating may be repeated hundreds of times, as long as the vinyl remains sealed. * Cost Analysis
Mr. Mark Tanner bought Therm-eze from its inventor for a total price of $250 000 which included the Canadian manufacturing and distribution rights. He also obtained a 17 year patent on the product in Canada. Mark Tanner will spend 50 cents for the vinyl bag which will be produced by an outside vendor. The die which will be paid for by the Tanner Company will cost $1000. The sodium acetate solution which will be purchased by an Ontario Supplier will cost $1 per bag. When Mark Tanner bought the company from the inventor he received 150 000 stainless steel triggers and any additional triggers need it will cost $1.50 per unit. The felt covers and...
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