Peak Garage Doors Inc.

1690 Words Nov 20th, 2008 7 Pages
INTRODUCTION Peak Garage Door Inc. has set a goal to increase their sales for 2004. Garage door industry is expecting a growth of 2.4% while the management of Peak is looking to increase company’s sales 26.4%. The company currently has 50 exclusive dealers and 300 non-exclusive dealers. Management has three proposals in front of them. The first suggestion is to increase the number dealers in their existing markets. The second recommendation is to develop an exclusive franchise agreement with existing non-exclusive dealers. The third recommendation is to decrease the number of dealers and focus company’s resources on increasing support for the existing dealers. Of course there is an option for them to leave everything as it is. My …show more content…
Peak currently serves 150 markets that are equivalent in terms of population size. The second proposal would be an exclusive franchise agreement with some existing independent owners. 27 independent dealers have inquired to Peak about becoming exclusive dealers for their areas. This would involve Peak providing more marketing support for these areas as well as a franchise fee paid for by the dealer. This would require Peak to drop all other independent dealers in these markets since they do not want them to be in the direct competition with one another. The remaining 73 markets would not be affected. Either party can cancel the contract with 90 day’s advanced notification. The third proposal suggests eliminating a number of the independent dealers. It is stated in this proposal that 70% of the sales for Peak are made through their exclusive dealers. The argument made by this proposal is that there has not been an exclusive dealership program in place before, and the company might not need one. The franchise program could also make Peak less flexible to future changes. This plan would have the number of non-exclusive dealers in the 150 markets decreased by 100 to a total of 200 while the 50 exclusive dealers would remain as they currently are. Ultimately, company can choose to stay as it is. However, this would mean that their chances of reaching their sales goal are slim.
POTENTIAL RESULTS The first proposal would be to increase the number of dealers in the

More about Peak Garage Doors Inc.

Open Document