Jones Blair Case Study
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Jones Blair Company Case Study
The US paint industry is considered to be a maturing industry, and industry sales in 2004 were estimated to be slightly over $16 billion. The US paint market is divided into three segments: architectural coatings (43%), original equipment manufacturing (OEM) coatings (35%), and special purpose coatings (22%). Architectural paint is a general purpose paint used in residential and commercial spaces, original equipment manufacturing paint is used for automobiles, appliances, and machinery, and special purpose paint is used for bridges, marine applications, and highway and traffic markings. Jones Blair Company (JBC) is a private company that produces and distributes architectural paint in the Dallas, Texas area. They also service counties in the surrounding states, with a total of more than 50 counties. The Dallas Fort Worth metropolitan area is the major source of business for the company. Jones Blair Company main market is do-it-yourself customers who make up 50% of their profits and professional painters who make up 25% of their profits. The architectural paint being produced and sold by JBC is top quality but is also the highest priced paint in the market. Sales for company have increased over the years; however their competition has increased as well with over 600 other paint companies in the United States. JBC distributes to 200 independent paint, hardware, and lumberyard stores, and has 8 sales representatives.
JBC must decide how to increase their profits and sales in the maturing market, therefore the company must decide which market to target their efforts. This case analysis will examine the four markets available to JBC and provide the recommendations for how the company should proceed. The four markets are Dallas Fort Worth Household, Dallas Fort Worth Professional, Non-Dallas Fort Worth Household, and Non-Dallas Fort Worth Professional.
Strengths
Years in Business
Relationships between stores and sales representatives
High Quality Product
Sell to 4 markets
Weaknesses
3% of net sales goes into marketing
Only have 8 sales representatives
Highest price in market
Opportunities
Market Growth 1-2% per year
Distribute to more than 200 stores in the area
Majority of stores not distributing to are in the rural (non-Dallas Fort Worth) area
Threats
600 competitors
Competition is less expensive
Competition spends more money