JONES BLAIR COMPANY Problem Recognition The Jones Blair Company sells top quality architectural paint, accessories

and OEM to various mar ets! Theorga organi"ation is currently headquartered at #allas, Te$as! %t mar ets its paints and sundry items in over &' counties in Te$as, O lahoma, (e) Me$ico and *ouisiana! Jones Blair mainly deals )ith customers loo ing +or a high end product! Jones Blair caters to mainly do,it,yoursel+ customers -&'. o+ sales/ and pro+essional painters -0&. o+ sales/ loo ing +or great point o+ purchase service, ease o+ application, and durability! The Jones Blair Company has increased sales on an annual basis, but the sales volume has stayed the same! Jones Blair needs to determine )here and ho) the company )ill mar et its architectural products! 1lternative 1nalysis a/ 2pend additional 34&',''' on corporate advertising! The mar eting department proposes a television campaign targeted at the #56 do,it, yoursel+ mar et! The advantage o+ doing this )ould be that the consumers )ill become a)are o+ Jones Blair! and also #o,it,yoursel+er7s account +or 8'. o+ volume in the #56 area! But,the problem )ith corporate advertising is that it )ill almost double the current advertising costs -349',''':34&','''/, also 8&. o+ the vie)ing audience does not buy paint and Consumer buying process sho)s household buyers choose a store +irst, not a brand; b/ Cut price by 0'. %+ the company cuts price by 0'. , it )ill sell more products because it )ill be able to compete )ith its competitors in price! But, i+ priced more competitively, it may not be loo ed at as superior quality! c/ <ire an additional sales rep 2ales outside o+ home territory #56 are crucial +or maintaining competition in the mar et as ne) clients may bring more opportunity to the table through )ord o+ mouth )ithout costing much to the company!But it also means not concentrating on the pro+itable mar et )ithout garuntee o+ ne) customers! d/ #o nothing -2tatus =uo/ Jones Blair )ill not change any o+ their mar eting strategy! Currently company is ma ing pro+it so the need +or change in strategy is not there! But in a long term perspective and )ith increasing investment in R># it )il be become important to employ ne) strategies in order to stay competitive! Recommendations Jones Blair needs to loo into %t7s vision and mission and +ocus on the +uture to compete )ith the competitors! %t is best to +ocus on the consumers in its main home mar et, #56a as advertising there )ill sooner or later least to )ord o+ mouth advertising in other areas )ithout incurring additional cost! %+ they spend 34&',''' they have to ma e a Minimum o+ 3?,''','''! Right no) Jones Blair can a++ord this and still have a 3@'',''' pro+it! This option is better than price cutting as the product is +or high end consumers and decreasing price might seem li e a compromise in quality! 1nne$ure ? 1dditional Cost A 34&',''' Contribution Margin A !4& Brea even Point A 4&!'''B!4& A ?,'',''' There+ore, company has to atleast ma e 3?,'',''' through #o it Coursel+ advertising! 1nne$ure 0

2ales DolumeE 3?0,''',''' ContributionE !4& Brea even A 3?0,''','''F!4&A 3@,0'',''' %+ price is cut by 0'. margin decreases by ?&. because 1s per E$hibit & *ast brand brought percentage +or (ational Paint Brands is 4'. and +or Jones is at ?&. ! To be at parity )ith (ational Paint Brands margin change is ?&. -3?0,''',''' : $/F!?& A 3@,0'',''' $A 3?9,''',''' %+ the company drops the price by 0'. the company )ill see a 44. increase in sales! ?9,''',''',?0,''','''A@,''',''' ?0,''','''B@,''','''A !44 1nne$ure 4 1 sales rep )ould cost the company 39',''' a year! 2o the company )ould need -39','''B!4&/ about 3?8?,@0G!&G o+ additional pro+its to cover this! (o o+ 2tores A ?0' Pro+utablity to be mainteained A 3@,0'',''' 3@,0'','''B?0'A 34&,''' 3?8?,@0G!&GB34&,''' A & 2o the company )ould require a ne) sales rep to acquire at least & ne) accounts a year to brea even!