Cardon Carpet Mills

Duy Dao

Marketing 495

4-2-12

Case Study #8

Cardon Carpet Mills, Inc

Problems statement

The competitive industry between the four different types of floor covering by manufacturers is a constant competition on who can get a bigger market share. Whether it is carpet and rug, resilient and vinyl, hardwood, ceramic title, or laminate, the competition between these different types of floorcovering is fierce. Suzanne Goldman met with Robert Meadows who is the president of Cardon Carpet Mills, Inc in early July 2000 to discuss whether or not they should implement a plan to set up their own distribution center or their own wholesale operations and continue with their tradition business model of just sell to wholesalers. Cardon Carpet Mills, Inc is a privately held manufacturer of a medium price to high priced carpet that is mainly targeted for residential use. The sales for carpet and rug industry from 1994 to 1999 is declining while the sales for non-carpet and rugs are on a steady growth. In order for Cardon Carpet Mills to implement a wholesale or distribution center business plan, they need to be able to examine their competitors and it the market will allow this new business plan to be profitable and take effect. In this case study brief, I will be analyzing the company's opportunity with a SWOT analysis and opportunity recognition.

Situational Analysis

Since the 1980's, whole and retail distribution in the U.S. carpet and rug industry has been undergoing changes in the market. It has gone through three different changes through the 1980s and 1990s decade. The first trend was in the 1980's with the direct distribution of the larger carpet and rug manufacturers being able to sell directly to retailers. During this process, they were able to skip the wholesale process and thus getting rid of the margins that they would have cost if they went to wholesalers. The second early 1990s, retail buying groups began...