Skil Corporation

GROUP 11 SECTION F

ANKIT BHARGAVA ANUJ THAKUR GIRISH MEENA NAWANG SHERPA NEHA HAJELA PARAMVEER SUMEET AGRAWAL

Skil corp!!!
Slow growth of Industry Mainly two types of customers are present : Professional customers Consumer ones Difference is not remarkable to gauge,what required is Price differentiation Heavy Investments Need for automation

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Understanding Skil corp in terms of: Product Marketing Manufacturing Channels

Product
Professional and consumer segments are covered 355 in number ,in various categories Circular saw is the strongest product Heavy emphasis on research and development

Marketing
Sponsored sales promotions and media advertising campaigns are occasionally done Relies more on product publicity than advertising

Manufacturing
Not followed Industry trend Not opted for automation Manufactures products through 13 plants

Channels
Extensive network of service centers throughout US -76 company owned service centers -427 authorized service centers Focuses on all distribution channels, i.e. consumers as well as professional/industrial

Financial Statement

Implications:Industry Average Gross profits are high and Skil corp has very low value of the same , indicating that the costs incurred for the product are comparatively higher.

Competitors Analysis
Aspect Skil Corp. Black & Decker Milwaukee Rockwell Sears, Roebuck
No. of products
355 280 280 130 50

R&D Expense

2.7mn

15mn

Total Sales

195(1978 data) Professional and Consumer

1205 Professional and Consumer(strong position)

1056.4

54

2598

Focus on channel

Professional

Mostly Professional

Consumer

Advertisement Spending

1.3mn(1978)

$47.3mn

$.321mn

$4.25mn

Issues
High cost of sales because of low gross margins. Lesser Advertisement,which leads to lack of communication to customers Case suggests that the operations from the foreign subsidiaries are not that efficient as compared to the operations in the US. Number of models disproportionate as compared with other companies, with respect to the sales.

Strategy???
Concentrate on hardware stores, with clear distinction for consumers and professionals Communicate quality of product to consumers by increasing ad budget

Channels

Advertisement

production
Reduction of cost by opting for Automation Form JV in other countries Scrap loss making units

Product

Drop down few of the product variants that have low demand from consumers Focus on quality

Observations
Very less differences between the consumer and professional segment is a point to be carefully taken care off- the professionals must not get a wrong image about the products of the company if he buys customer quality products instead of professional Skil Corp requires some time to get par with other competitors, then it can leverage on its competencies to boost sales.

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