Blair Case

Market Segments

The market segments in which Jones-Blair competes are as follows:

a) Architectural coatings: these include professional buyers and do-it-yourself buyers who mainly use the products for house redecorating, maintenance, and repair.

b) ORM coatings: these buyers are manufacturing firms of durable goods.

Decision Criteria

When buyers are deciding on an architectural good, they are affecting by two factors. The first is an alternative material, such as aluminum and vinyl siding, or interior wall coverings and wood paneling. If and when they do decide to go with paint, a new decision process becomes evident. The process starts with the decision on the product/project. This is where issues such as time, money, and whether the purchase is going to enhance an investment come into play. The next step is to gather information about the product. They can get this information from friends, retailers, consumer reports, magazines, and always from the Internet. After the information stage, the customer then decides on a store from which they are going to buy the product. Several factors help them decide on this (different store 46%; one store 27%; best price 22%). The last decision is based on a set of criteria that ranges from quality to ease of use.

When professionals are purchasing a product, they tend to be less price sensitive and more attracted to quality and durability. This is because their reputations are on the line and they want to deliver quality service with a quality product. This group also looks to retailers who will go the extra step to five them service.

Contractors, especially large ones, tend to be more price sensitive and will purchase items in bulk just to get the job done. They are not so worried about the quality because most manufacturers have enough quality in the paint product that they need not worry about loss of business. Some projects, however, will require a premium product.

SWOT Analysis

Strengths

* Strong competitive edge against manufacturers that distribute products nationally

* Small sales staff paid based on salary and commission

* Personal connection with client/sales staff

* Strength of brand name as premium product Weaknesses

* Cost-of-goods sold equals 60 percent of sales

* Gaps in capabilities, such as special-purpose coating customers.

* No plan of action for future

Opportunities

* Could buy out dying firms and become a larger company gaining market share

* Competitors' vulnerabilities

* Industry or lifestyle trends

* Technology development and innovation of paint products

* Global influences, such as developing economies need for product

Threats

* Paint companies are declining at a rate of 2 to 3 percent