Crafton Industry Essay example

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Subanti Mortuza MK 4900 MW 4:45- 7:15 Crafton Industries, Inc. 1. Situational Analysis -The U.S. Flooring Industry · In 2009 businesses spent near $17 billion for floorcoverings. · The largest floor covering product is carpet and rugs followed by ceramic tile, vinyl, hardwood, stone, laminate and rubber floorings. · Residential sales accounted about 11.33 billion sales (2/ 3 of the sales) in the flooring industry and commercial accounted 5.67 billion sales. · The dollar sales of U.S. floorcoverings went down from $23,227 million in 2007 to $17,122 million in 2009 leaving a difference of $6,105 million. · In 2007 the industry sales tumbled 29% at the current prices and 27% after adjusting for inflation. -The…show more content…
· Carpet One and Abbey Carpets, two main buying groups asked their members not to do business with Shaw. · After all these, in 1998 Shaw industries announced it would sell of its retail stores to Maxim Group for $93 million. And later Home Depot started stocking Shaw carpet once again. -Crafton Industries, Inc. · Sells premium priced carpeting to rich residential segment of the industry. · The company had sales of $75 million in the year of 2010 and 72% of the sales were attributed toward residential market. · The company’s net profit before taxes were $3 million while they only accounted 0.4% of the market. · Crafton distributes the product to seven floor covering wholesalers, who supply to 4000 retail accounts. · The wholesalers are located all over West, East and Midwest Coasts. · Half of the company’s retail accounts provide for about 80% of the overall sales. · The company has wholesalers who represented the company for about more than 20 years. · The company employees 10 salespeople who mains extensive sales organization. · The wholesalers for the company received a 20% margin on sales billed at the price to retailers and wholesalers typically applied a markup on cost of 125% for carpeting sold to retailers. 2. Problem While the retailers are becoming more conscientious about the price Crafton industries has
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