Gainesboro Case

Gainesboro Machine Tools Corporation

Gainesboro Corporation is a company that began in 1923 as a manufacturer of metal machinery parts which was in high demand during the Second World War. Since then, Gainesboro has changed with the times, entering into the machine tool industry in 1975 and most recently has transitioned into computer-aided design and computer-aided manufacturing (CAD/CAM) equipment manufacturer.

Gainesboro Machine Tools Background

The company was found in 1923 in Concord, New Hampshire, by two mechanicals engineers. In its early years, Gainesboro had designed and manufactured a number of machinery parts, including metal presses, dies and molds. Later on, in 1940, the company’s large manufacturing plant produced armored-vehicle and tank parts and miscellaneous equipment for the war effort. After the war, the company concentrated on the production of industrial presses and molds, for plastics as well as metals. By 1975, the company had developed a reputation as an innovative producer of industrial machinery and machine tools. In the early 1980s, Gainesboro entered the new field of computer-aided design and computer-aided manufacturing (CAD/CAM). Gainesboro merged the software company into his operations and over the next several years, perfected the CAM equipment. By the end of 2004, CAD/CAM equipment and software were responsible for about 45% of sales; presses, dies, and molds made up 40% of sales; and miscellaneous tools were 15% of sales.

Gainesboro was number one leader in the press and mold industry. Thus, within the CAD/CAM industry competed with a number of larger firms, including Autodesk Inc., Cadence Design, and Synopsys Inc. for dominance of the growing market. Gainesboro company’s sales dropped significantly because of aggressive, large foreign firms with technological advances and capitalism entry to CAD/CAM and the rise of U.S. dollar. As the result revenues dropped from $911million in 1998 to $757 million in 2004....