CPMR

1. CPMR Course 201 2010

2. John L. Schlacter is Professor of Marketing in the W. P. Carey School of Business at Arizona State University. He received his bachelor's degree from Western Reserve University and his MBA and Ph.D. degrees from Ohio State University. Dr. Schlacter is primarily interested in the behavioral aspects of organizations and the marketplace, as well as strategic market planning and the development of marketing intelligence systems. He has received the award for outstanding teaching and contributing to ASU's Center for Executive Development. He has also served as Assistant Dean for the College, and has published over eighty articles appearing in a variety of management and marketing journals and trade publications. Dr. Schlacter is an active participant in executive development programs at Arizona State University, has taught in the MBA for Executives program, and is also a consulting associate with Management Horizons, Inc., whose clients include members of the distributive trades. Dr. Schlacter consults in the areas of both marketing and management, and has over thirty years of experience in these fields. The majority of his work has involved organizational development, motivation and leadership and communication team building, as well as strategic planning, marketing research and work with salespeople and sales managers. He has consulted with a number of Fortune 500 firms as well as smaller owner-managed firms. His work has spanned industrial, wholesale/retail and service organizations and trade associations. In addition to his consulting activities, he has authored and participated in several hundred executive and management development programs over the past thirty years throughout the United States and abroad.

3. STRATEGIC MARKETING PLANNING FOR MANUFACTURERS' REPRESENTATIVES I. A Definition of "Strategic Marketing" II. Three Key Planning Questions III Situation Analysis: External IV. Situation Analysis: Internal V. Market Opportunity Analysis VI. Mission and Objectives VII. Strategies and Tactics VIII. Tools for Analysis A. Implementation Form: Activity Charting B. The Nine Cell Matrix

4. A DEFINITION OF STRATEGIC MARKETING

5. Strategic Marketing: Bringing Organizational Resources To Bear On Marketplace Opportunities Within the Constraints Imposed By The External Environment.

6. Three Key Planning Questions: 1. Where Are We Now? 2. Where Do We Want to Go? 3. How Do We Want to Get There?

7. WHERE ARE WE NOW?

8. A Strategic Marketing Model for Manufacturers' Representatives I. Situation Analysis A. External Environment 1. Political/Legal 2. Economic 3. Sociocultural 4. Industry/Competitive 5. Technology • Suppliers • Physical

9. A Strategic Marketing Model for Manufacturers' Representatives I. Situation Analysis A. External Environment 1. Political/Legal a. What is happening? b. What does it mean for me? 2. Economic a. What is happening? b. What does it mean for me? 3. Sociocultural a. What is happening? b. What does it mean for me? 4. Industry/Competitive a. What is happening in my industry? b. What does it mean for me? c. Who are my key competitors? d. What are their strategies and present situation? e. What does it mean for me? 5. Technology a. What is happening? b. What does it mean for me? 6. Suppliers a. Who are my key suppliers? b. What is happening in their business? c. What does it mean for me? 7. Physical a. What is happening? b. What does it mean for me?

10. A Strategic Marketing Model for Manufacturers' Representatives I. Situation Analysis B. Internal Environment 1. History/Mission (Who Am I?) 2. Financial Condition 3. Management/Organization Structure 4. Personnel 5. Technical 6. Marketing and Sales

11. A Strategic Marketing Model for Manufacturers' Representatives I. Situation Analysis B. Internal Environment 1. History/Mission (Who Am I?) 2. Financial Condition a. What looks good? b. What needs to be improved? 3. Management/Organization Structure a. Are we organized well with good management in place and a plan for succession? b. What needs to be improved? 4. Personnel a. Do we have enough of the right people in the right places? b. What needs to be improved? 5. Technical a. Are we up to date technically? (e.g., computers, data gathering and storing, e‑mail, fax, etc.) b. What needs to be improved? 6. Marketing and Sales a. Do we consistently deliver value to our customers (the right product, accompanied by the right service, delivered to the right people at the right place and time, and at the right price)? b. What needs to be improved?

12. A Strategic Marketing Model for Manufacturers' Representatives II. Market Opportunity Analysis A. Existing Principals B. Potential Principals C. Existing Customers D. Potential Customers E. Who Will We Choose to Target Among Our Existing and Potential Market Targets?

13. A Strategic Marketing Model for Manufacturers' Representatives II. Market Opportunity Analysis A. Existing Principals 1. In what industries are our present principals? 2. How much of these markets do they control? B. Potential Principals 1. What new industries might offer opportunities? 2. Who are some of the key players (potential principals) in these markets? 3. What do we know about each of them? 4. What else do we need to know? C. Existing Customers 1. In what industries are our present customers? 2. How much of these markets do we control? 3. Who are our key accounts in these markets? 4. What is happening in these markets and with these accounts that we need to know about? 5. What is the "potential" of these targets? D. Potential Customers 1. What new industries might offer opportunities? 2. Who are some of the key players (potential accounts) in these markets? 3. What do we know about each of them? 4. What else do we need to know? 5. What is the potential of these targets? E. Who Will We Choose to Target Among Our Existing and Potential Market Targets? 1. In what industries will we be active? 2. Who will be our key principals? 3. Who will be our key accounts?

14. WHERE DO WE WANT TO GO?

15. A Strategic Marketing Model for Manufacturers' Representatives III. Mission Statement and Objectives A. Mission Statement: What kinds of products and services do we want to sell to whom? B. Objectives: What key standards need to be met in order to successfully exploit our market targets? 1. Financial 2. Management and Organization 3. People 4. Marketing and Sales

16. Sample Mission Statements Lewis Marketing is a quality driven MR agency striving to be of #1 value to our plumbing irrigation, utilities and water systems wholesalers in North & South Carolina and to the principles we represent in those industries.

17. Sample Mission Statements NDB & Associates, Inc. is a Sub Chapter S Corporation headquartered in Devon, Pennsylvania. We are a Manufacturers Sales Representative Organization specializing in Office Products and Office Furniture covering Pennsylvania, Southern New Jersey, Delaware, Maryland, D.C. and Virginia.We sell to Wholesalers, Contract Dealers, and Retailers of Office Products. NDB strives to meet or exceed our principles sales and marketing goals by providing world class professional service and training to our customers.

18. Sample Mission Statements The Wild Company is a premiere manufacturer rep organization servicing the northeast United States in partnership with quality manufacturers whose products are used or resold by styling salons. We are committed to quality performance for our manufacturers, through our field and tele-sales team to our distributors.

19. Sample Mission Statements Zaslow Sales Company is an electronics manufacturers’ representative firm committed to the technical selling and marketing of component and engineered power, control and system packaging products through direct and distributor sales channels in order to provide design solutions and continuing sales support to commercial, industrial and military/ aerospace customers in New England.

20. Sample Mission Statements We are a national manufacturers representative firm servicing the Canadian distribution network, multi-unit chain operations and volume feeders with high quality commercial food service equipment and supplies.

21. Sample Mission Statements Rudolph & Co., Inc., Electrical Manufacturers Representatives, in partnership with it’s Principal Manufacturers, is committed to providing the highest quality electrical products to the residential, contractor, commercial, industrial, and utility markets through wholesale electrical distributors.

22. HOW DO WE WANT TO GET THERE?

23. A Strategic Marketing Model for Manufacturers' Representatives IV. Strategies and Tactics: What do we need to do to accomplish our objectives? (What activities need to occur, who will be responsible for these activities, and over what period of time will they be completed?) A. Financial B. Management and Organization C. People D. Marketing and Sales

24. A COMPLETE MODEL OF THE STRATEGIC MARKETING PROCESS

25. A Strategic Marketing Model for Manufacturers' Representatives I. Situation Analysis A. External Environment 1. Political/Legal 2. Economic 3. Sociocultural 4. Industry/Competitive 5. Technology 6. Suppliers B. Internal Environment 1. History/Mission 2. Financial Condition 3. Management/Organization Structure 4. Personnel 5. Technical 6. Marketing and Sales II. Market Opportunity Analysis A. Existing Principals B. Potential Principals C. Existing Customers D.Potential Customers E.Who Will We Choose to Target Among Our Existing and Potential Market Targets? III. Mission Statement and Objectives A. Mission Statement B. Objectives 1. Financial 2. Management and Organization 3. People 4. Marketing and Sales IV. Strategies and Tactics A. Financial B. Management and Organization C. People D. Marketing and Sales

26. The Strategic Marketing Process Model 1. Where are we now? External Environment Market Opportunity Analysis Tool: 9-cell matrix Internal Environment 2. Where do we want to go? Mission and Objectives 3. How do we want to get there? Strategies and Tactics Tool: Implementation Plan

27. STRATEGIES AND TACTICS:ACTIVITY CHARTING

28. IMPLEMENTATION CHART FOR: (MARKET SEGMENT/ OBJECTIVE) • 1. • 2. • 3. • 4. • 5. • 6. • 7. • 8. • 9. • 10. Person responsible ACTIVITIES TIME

29. MARKET OPPORTUNITY ANALYSIS: THE NINE-CELL MATRIX

30. PRODUCT PORTFOLIO MATRIX: MARKET ATTRACTIVENESS AND BUSINESS STRENGTH

31. INVEST/GROW Market Attractiveness High Medium • Premium: Invest for • Growth • provide maximum investment • diversify worldwide • consolidate position • accept moderate near-term profits • Selective: Invest for • Growth • invest heavily in selected segments • share ceiling • seek attractive new segments to apply strength High Medium Business Strength • Challenge: Invest for Growth • build selectively on strengths • define implications of leadership challenge • avoid vulnerability, fill weaknesses

32. HARVEST/DIVEST Market Attractiveness Medium Low • Restructure: • Harvest or Divest • provide no unessential commitment • position for divestment or • shift to more attractive segment Medium Low Business Strength • Harvest or Divest • exit from market or prune product line • determine timing so as to maximize present value • Opportunistic: • Preserve for Harvest • act to preserve or boost cash flow • seek opportunistic sale or • seek opportunistic rationalization to increase strengths

33. SELECTIVELY INVEST/HOLD • Protect Refocus: Selectively Invest for Earnings • defend strengths • refocus to attractive segments • evaluate industry revitalization • monitor for harvest or divestment timing Market Attractiveness High Medium Low High Medium Low • Prime: Selectively Invest for Earnings • segment market • make contingency plans for vulnerability Business Strength • Opportunistic: Selectively Invest for Earnings • ride market • seek niches, specialization • seek opportunity to increase strength (e.g., acquisition)

34. 5,5 3.67 2.33 1 Steps 1. Identify criteria for market attractiveness and business strengths (see below for example). 2. Weight criteria for market attractiveness (divide 100 points) and business strength (divide 100 points between criteria for rep. and criteria for principal). 3. Rate the particular market segment and the particular rep/principal on each criterion for market attractiveness and business strength respectively (use 1-5 scale). 4. Multiply the wt. x rating for each criterion on each axis and sum the score for market attractiveness and business strength. 5. Place principal/product in matrix. Business Strength Market Attractiveness 3.67 2.33 1 Market Attractiveness Expected lifetime (cycle) “Need” = excess demand Growth Competition Barriers -capital/plant technology political/legal/cultural Size Cyclicality/Seasonality “Fit” (synergy) Profitability Business Strengths Marketing know-how Capacity (physical plant) Size Growth Profitability Product synergy Distribution base Mgt People Financial Brand name/image Technical know-how Market share

36. Market Attractiveness 5,5 3.67 2.33 1 Strengths 3.67 2.33 1

49. 1993 1% 14% 1 40% 6 16% 5 2 4 3 14% 15% 1994 1995 1% 6% 21% 21% 7 32% 7 8 2% 1 14% 6 6 1 4% 5 12% 5 2 16% 2 9% 4 3 3 4 20% 15% 6% 21% EXHIBIT 7.8 The McKenzie Company’s Principals • 1 Elm Grove Capacitor • 2 Circuit Specialists • 3 Genesis • 4 Waltham Resistor • 5 Pronto Circuit • 6 Flexico • 7 Alba Electronics • 8 Hosunwa America