Friday, October 18, 2019

Strategic Marketing Planning of S&W and Makatume Assignment

Strategic Marketing Planning of S&W and Makatume - Assignment Example The high consumer demand gives the opportunity to the company to charge higher prices, be better placed in retailers' shelf space and have co-op advertising. Weaknesses = its costs are high since its old production plants are in urban areas whereas labor costs are high. Another weakness is that there is a market confusion between it's professional and consumer tools. The distributors, on the other hand, feel that the company has abused its market position. A further weakness is that S&W is not present in the fast-growing cordless segment. Opportunities = Makatume is locked into lower voltages so there is enough space for S&W to enter the high voltage space. There is also space for the lower voltage market since apart from Makatume, the other players are small companies (domestic and foreign niche competitors). Makatume's position was also due to the favorable exchange rates but the exchange rate forecast for the next years is not that favorable. Threats = Makatume has a good reputation in tradesmen for its professional tools. Makatume follows an aggressive strategy and its aim is to become the No2 player in the US market. It has also a dominant market share in the growing cordless segment. The primary step will cost reduction so as S&W can become more competitive and survive competition from cheaper producers such as Makatume and the Chinese. The production plants through offshoring should move to countries where labor costs are lower. However, S&W should take care that the quality of products manufactured in foreign plants should be equivalent to the ones produced locally. The old production plants, on the other hand, could be used for other business purposes (e.g. premises) or at least they could be rent.Another weakness is the market confusion for consumer and professional tools. Since S&W advertises heavily then it can make a clear positioning of the above tools in its advertisements. There should be market researches done prior and post the advertising campaigns which will check the degree of confusion in the minds of consumers.  

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