Jones-Blair Case

Re: Jones-Blair Company Proposal

Recommendation: Hire an additional sales representative to focus primarily on maintaining new business accounts outside the Dallas-Fort Worth (DFW) 11 county market.

Problem Statement: Jones-Blair Company (JB), a regional manufacturer of high-quality paint in the 11 county Dallas-Fort Worth Area and surrounding 39 county region, needs to develop a marketing mix that satisfies a maturing architectural paint coatings and sundries market, in order to maintain historical growth and profit margins.

Facts:

Regional Market: The regional market in architectural coatings and sundries reached 80 million dollars in 2004. Jones-Blair primarily competes for market share within this market. Sales growth has typically increased at the rate of inflation (an average increase of 1.4% per year) since 2000 (exhibit 1). This market can be further divided into two major regions.

* Dallas-Fort Worth (11counties): Dallas-Fort Worth (DFW) accounted for 60% of regional sales in 2004, or 48 million dollars (excluding contractor sales).

* Non-Dallas-Fort Worth (39 surrounding counties): Non-DFW accounted for 40% of regional sales in 2004, or 32 million dollars (excluding contractor sales).

Two major end-user segments account for the relevant market:

* “Do it yourself” household buyers- 70% of DFW sales (or $33.6 million/$48 million).

* “Professional painters”- 90% of non-DFW sales (or $28.8 million/$32 million).

The table below summarizes relevant market deductions based on these estimates:

Industry Architectural Paint and Sundry Sales Volume (excluding contractor sales) 2004.

Region | Do-It-Yourself Sales/ Total Market Share | Professional Painter Sales / Total Market Share | Total Dollars /Market Share |

| | | |

Urban / DFW | *33.6/42% | *14.4/18% | *48/60% |

Rural / non-DFW | *28.8/36% | *3.2/4% | *32/40% |

Total $ | *62.4/78% | *17.6/22% | *80/100%* in millions of dollars |

Jones-Blair Co. (JB)...