Fenix Del Sur Llc

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Category: Business and Industry

Date Submitted: 01/11/2013 06:08 PM

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Step 3: Alternatives

Jones Blair senior management team has developed four different suggestions to solve the company’s marketing problem as below:-

c. Hire additional sales representatives

Vice president of Sales has proposed that the company should hire additional sales representatives. Hiring an additional sale representative will allow Jones Blair to focus on new markets in non-DFW area. This is because non-DFW area has a potential growth of market. They would develop new retail account leads and presentation or call on professional painters to solicit their business through the dealers.

Sales of non-DFW territory are crucial for maintaining competition in the market especially as the peak painting seasons approaching soon. A sales rep would cost the company $60,000 a year. So the company would need about $171,428.58 ($60,000/.35) of additional profits to cover this yearly cost. Current existing 120 retailers are located outside of DFW. From the current achievement, $4,200,000 is the amount needed to be maintained in order for Jones Blair to stay profitable. Profit amount required from each retailers in order to maintain the profit is $35,000 ($4,200,000/120). From the figure, Jones Blair would acquire at least 5 ($171,428.58/$35,000 = 4.89) new accounts in order to get breakeven return on new representatives’ investment.

d. Continue to guard margins and control costs

Vice president of Finance has proposed that the company should maintain their current marketing objectives and operate their business as usual as Jones Blair has continually making profits year by year. So, Jones Blair should keep on doing their best as before by watching the margins and controlling costs and this is still will permit Jones Blair Company to continue making profit. The company will not need to spend any additional money and they will not contribute in any risk.

e. Gives 40% price cut and redirect advertising