[Canty International] Marketing Plan

1. [Canty International]Marketing Plan [Castling, Chaudhry, Jones, Phan, Wang, Wong]

2. Introduction • Canty International received a request for an important customer in the hotel industry. • Decoline’s characteristics are that it is a durable, stain-resistant, sound conscious product that is also pleasing to the eye. • It is custom designed for each client. • Canty International must determine a reasonable price point that works both for Bryant Inns and themselves.

3. Problem • What price point should Decoline be put at to be viable to produce and be purchased?

4. Key Findings • Facts • Single client, Bryant Inns. • Competitive Advantage • Competitors product priced at $81.50 • Contacted Designlab, developed Decoline

5. Assumptions • Only product being considered • Cost of production will not substantially increase • Bryant Inns has intent to purchase • Can maintain sales of 500m² per month

6. SWOT Analysis • Strengths • No current competition • Products fit buyer’s needs • Reliable and cost effective • Parent company helps with development • At cost production materials and no input transportation costs

7. SWOT Analysis • Weaknesses • Each design has to be custom made • No production capacity to expand • Small target market • Customers must wait for 2 weeks

8. SWOT Analysis • Opportunities • Create monopoly of wall tiling market • Market expansion while taking away from other wall coverings markets • The Inn’s gain: • Less transportation cost • Less installation cost • Less maintenance • Custom tailored product to their specification • Less lost revenue due to construction

9. SWOT Analysis • Threats • Possible new competition • Increase of inputs rising • Unable to satisfy market demand • Market looks for other alternatives because of cost to buy and install • Cost of installation increases • Market changes from current track system

10. Competitive Analysis • One competitor • Competition product lifespan of two years • Sells for $11.50m² not including a $4.80m² installation fee • Does not offer same benefits as our Decoline • Uses same track system as Decoline

12. Competitive Analysis (11.50+4.80) x 5 = $81.50 X+5.40 = (11.50+4.80) x 5 X+5.40=81.50 X=$76.10 m2 $76.10 is the price equal to the competitor

13. Target Market • Niche market within the hospitality sector • B2B sales through professional buyers • Micro marketing catered towards consumer • Operates 150 Inns and growing • Bryant Inns is not satisfied with current product

14. Fixed Costs(For 1 Month) • Supervision 1080 • Inspection 165 • Misc. Indirect Labour 84 • Floor space 327 • Small Tools 30 • Selling/Admin = 4300 – 1310(2/3) = 3493.33 • Cutting Machine Amort. Expense 4 • Tables Amort. Expense 38.75 Total $5222.08

15. Variable Costs $7.28/m2 $3.30/m2 $0.797/m2 $1.306/m2 $12.68/m2 • Techno-fibre = $6.55/0.9m2 = • Bamboo = $2.97/0.9m2 = • Cement = 0.83L/m2 X 0.96c/L = • Direct Labour hours = .184 hours/m2 X 7.10/hr = • Total Costs per square meter=

16. Alternative 1 • Price Skimming • Advantages • Able to price Decoline at a high price • Built in value as it caters to customers • Competition will not be able to enter the market easily Competitor price= $81.50 for 10 years Decoline price= $90 for 10 years

17. Alternative 1 • Price Skimming • Disadvantages • Relatively high unit cost • Produces small volumes of Decoline (maintains image) • Discontent for consumers. Buyers remorse

18. Alternative 2 • Value-based price • Advantages • Profitable for Canty. • Accurate reflection of value to customer. • Introduces Decoline to the market as a high value product. Competitor price = $81.50 Decoline price = $62.90 Over a 10 year period

19. Alternative 2 • Value-based price • Disadvantages • Esoteric. • Substantial jump in price from previous product. • Market perception.

20. Alternative 3 • Price Penetration • Advantages • Competitor based • Simple to price • Customer responsive Competitor Price = $81.50/m2ten year period Decoline Price = ($23.12/m2 x 30% markup) + $5.40/m2 = $35.46/m2ten year period

21. Alternative 3 • Price Penetration • Disadvantages • Not-profitable. • Predatory pricing? • Not really substitutes.

22. 10 Year Price Alternative Comparision

23. Solution • Value-based price • Competitor price = $16.30 every two years = $81.50/m2 every 10 years Decoline price = $62.90/m2 every 10 years = Savings of $18.60/m2 every 10 years • Offers good value to customers and at the same time is still profitable • Price although higher is still attractive to customers because of benefits

24. Implementation Plan • Price: $57.50 (installation fee not included) • Product: Customer Specific Decoline • Place: While we don’t have stores, we use sales representatives to go to our customers • Promotion: Our initial asking price is value based and lower over 10 years than competitors

25. Implementation Steps

26. Plan B Alternative 1 Price Skimming • Implementation plan the same • Sales representatives quote the higher price and advantages over competition • Will allow production to remain low as problems are worked out of the production line

27. Course Concepts • SWOT Analysis • Marketing mix (Target Market & 4Ps) • Price Skimming (Alternative 1) • Value-Based Methods (Alternative 2) • Market Penetration Pricing (Alternative 3) • Break Even Analysis • B2B development and sales • Market Expansion • Niche Marketing • Micro Marketing

28. References/Bibliography • Marketing. Canadian ed. USA: McGraw-Hill, 2009. Print. • Case Study 2