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Cmr Enterprises Essays

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4383 Case 1 CMR Enterprises
CMR, originally Mike’s Cabinets, is an architectural millwork business that competes in two different market segments: commercial and residential. In order to effectively compete in both markets, the nature of CMR’s business varies slightly between them.
Commercial business provides two-thirds of the company’s projects as well as 80% of its sales. Due to the higher volume in demand, the commercial sales force is larger than the residential sales team, which relies heavily on CMR’s showroom. The market for commercial business is larger than residential market with projections of its value at upwards of $5 billion. Commercial contracts are also harder to secure than their residential counterparts. They must be
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Marcus saw that the residential side of the business had great potential for future growth, and he knew that this was a great way to get his company involved. The additional emphasis on residential work used more of the company’s resources, but it proved to be worth it with the increased revenue and cash flows.
CMR Enterprises is confronting an issue with one of its most valuable clients, Blackstone. Blackstone as one of the biggest customers in the area, giving CMR an opportunity for immediate market share and his volume supported its goals to standardize its processes into flexible cells. They approached CMR looking for a new partner to work on a business that represented 25% of CMR’s residential business during the first year of this relationship. Sam Marcus was counting on further growth with his customer to pay his debt and fund expansion efforts. But relationships with Blackstone had become increasingly intense on residential construction.
Marcus had aggressive goals of reaching $70 million in sales by 2007 by creating a scalable and replicable business model. Moreover, build close relationship with the Blackstone will gave CMR an opportunity to standardize its business processes to be able to benefit from improved operational efficiencies that comes because of scale of operations.
However, the relationship between two companies had evolved
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