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Manufacturer of Lighting Fixtures and Parts
Background
The firm is a manufacturer of metal stampings and roll-formed parts for
the lighting industry. At certification, the firm had annual sales of
approximately $1.8 million and 29 employees.
The current owners purchased the firm in 1986, and have continued the
traditional business of the firm, producing parts primarily for the lighting
industry. In 1999, in a defensive action against the effects of increased
foreign competition, the firm’s owners purchased the assets of a New York City
metal stamping company.
Unfortunately, even with the addition of the metal stamping company, the firm’s
market continues to shrink due to increasing competition from foreign products,
particularly from Taiwan and China. Although the firm’s manufacturing processes
were adequate for the level of output, the markets for the firm’s products were
mature and at best stagnant and sales representation was weak. Moreover, the
market is almost entirely served by overseas manufacturers. Thus, specific areas
were identified that if improved would ensure the long-term viability of the
business.
Assistance Provided
The recovery strategy included a plan to address both short-term and
long- term objectives to help the firm recover from the effects of lost sales
revenue due to increased import penetration. The first order of business was to
replace lost sales.
After analyzing the strengths of the business, it was determined that drawing on
the firm’s excellent reputation for quality, high performance parts and timely
service could generate new sales. Thus, a strategic business/ marketing plan was
proposed that would provide the firm with immediate (short-term) tangible
results as well as a solid foundation for the firm’s long-term recovery. This
plan of action created and organized the firm’s key business function, marketing
and sales. A consultant was hired to provide the following deliverables:
 •
Research and assess the market and profile successful competitors.
•
Compare the firm's products to its competitors and describe the
characteristics,
capabilities, and potential for the firm in its market.
•
Develop marketing goals and objectives with focus on current and
future
markets.
•
Analyze the growing trends of the industry while identifying target
markets in
specific geographic areas for new business opportunities;
develop a
marketing strategy that will attract that business and
generate
additional sales volume.
•
Identify and profile potential customers for precision made-to-order
sheet metal
components and identify outsourcing OEM projects for
the firm to
evaluate as a means of opportunity.
•
Develop realistic short- and long-range sales goals and objectives,
sales
forecasts, and an alternative strategy to achieve these goals.
•
Evaluate current mode of sales representation and determine through
market
analysis, the most useful type of representation for the firm
and its
products, and develop and implement a sales training program
for the
organization.
•
Develop to pre-production status, advertising media (promotional tools),
that will
enhance the firm’s visibility in its domestic market (i.e., video,
overheads,
sales automation software, web site and/or interactive
CD-ROM,
designed around the many features and benefits the firm
can offer
the market.
Project Results
The firm has gained a number of benefits from this successfully completed
project. First and foremost, a sound and accurate marketing plan was provided
that outlined a precise roadmap for the owners to follow, including sales
projections. The sales forecast has been developed for the short-term, with
on-going adjustments as needed.
Next, appropriate sales and marketing tools were recommended, organized, and
categorized, to attract new business and continue growth of the firm’s current
business. The firm experienced a 5 percent increase in sales, and employment increased 10
percent almost immediately after implementing the new tools.
Other significant events happened as a result of this project. To support the
increase in business, a new
addition was constructed that added an extra 70,000 square feet of
manufacturing space. A new parts catalog was developed, as well as the firm's first corporate web site. Plus, realizing they
could not do everything
themselves while growing the business, management began the process of
recruiting an experienced sales and marketing professional for the management
team.
The project also recommended that management investigate the feasibility of
exhibiting at industry specific trade shows and pursue the acquisition of an
integrated sales and marketing software package to manage the firm's new and
expanding customer base.
If successfully implemented, the firm’s business is projected to double within
five years.
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