Cumberland Metal IndustriesCase study
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Situation Analysis:
Company:
Cumberland Metal Industries is one of the largest manufacturers of curled metal products. They are about to introduce their pads into the market as an alternative to the asbestos pads that are already available. The CMI pads take only 4 minutes to change as opposed to the asbestos pads that take 20. They also require to be changed fewer times, which in the long run could potentially save a contractor a lot of money. The decision that needs to be made is how much to price the new pads at. If they price them too low, they will be losing out on a lot of money available to them. But, if they price them too high, customers will not want to buy them and they will have lost money. CMI's net sales and net income have decreased from 1978-1979, which is all the more reason that they need to price this correctly to have an increase in these areas. They do not have a very large market to sell to and because the pads are a necessity, they will have to really show why theirs is better to get a customer to purchase it over the asbestos.
Customers:
The customers who would purchase the CMI pad would be construction and independent pile driving contractors...