Fabtek Case

1347 Words Sep 17th, 2012 6 Pages
Case: Fabtek

EXECUTIVE SUMMARY
Fabtek has the ability to position themselves for profitable growth, but they need to fix their business, focus on key business drivers, and re-evaluate the area. Listed below are the key issues they face and the recommendations for improvement. Focusing on these issues and developing selection criteria for quoting would help Fabtek improve their current profitability and position them for growth. Fabtek should accept the Pierce Pike order as it closely matches Fabtek 's selection criteria for selecting orders.

Issue Recommendation
Lack of Sales Focus Fabtek states anyone can make a sell. This indicates the company places a low priority on training sales people. Fabtek needs to focus on direct selling
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Fabtek has appointed a former marketing expert, Lightfoot, to lead operations. Lightfoot has indicated the need for a greater mark-up on labor due to uncertainty. However, customers are unlikely to pay for uncertainty. This approach will only inflate a quote and hamper the ability to make a sale based on "value" provided to the customer.
Reducing manufacturing overhead improving labor estimates on quotes is important because currently the marketing department does not trust cost estimates from the operations department. Marketing typically adjusts quotes to reflect market and corporate goals. This is a poor approach to address the bidding process and is likely a contributing factor the low success rate of quotes.
Manufacturing Costs are unreliable and the Bidding Process has a low success rate. Fabtek needs to train its manufacturing and marketing group to work together in estimating accurate costs, lead-times and understanding customer value in quoting a job. Fabtek should only quote business opportunities that fit the company 's selection criteria defined by Marketing and Operations. This strategy would increase Fabtek 's hit rate on quotes.

Too Many Markets
Fabtek currently serves 11 markets. They need to prioritize the business portfolio and reduce the number of markets served. Fabtek needs a new marketing approach with an increased focus on growth. The company 's methodology and the strategy should be adjusted to reflect market fluctuations, competitor

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