Pyramid Door Case Analysis

1611 Words May 3rd, 2016 7 Pages
I. Problem statement
Which strategy should Pyramid Door, Inc. implement, along with increased advertising for 100 dealers to achieve the sales goal of $12.5 million for the year of 2006? The four strategic options are increasing the number of non-exclusive dealers by 100, developing a formal executive franchise with 27 dealers so they would exclusively sell Pyramid Door products, reduce the number of non-exlusive dealers by 100, and the last plan was to only do a better job with current distribution policy and network.
II. Industry Analysis
A. National industry analysis:
In the residential garage door industry sales are projected to be $2.25 billion representing a 2.4% increase. There are several large national
…show more content…
Steel garage doors were preferred to wood garage door by a 9 to 1 margin. With everything being said, it is important to be available in as many stores as possible so consumers don’t have to seek out Pyramid Door brand garage doors and they can find them just by walking around a store.
In 2005 the residential garage door industry sales were expected to reach $2.2 billion with 90% of sales being steel garage doors. Demand for replacement garage doors was driven by the continued aging of the housing stock and the conversion of homeowners from wood doors to lighter weight, easier-to-maintain steel doors. Also, product innovations such as insulated steel doors, new springing systems, and residential garage doors with improved safety features have made steel doors increasingly popular.
B. Industry analysis in Pyramid’s trade area:
Pyramid Door’s projected market share for 2005 was 2.6%. Independent dealers typically sold 3 different brands and there was a clearly dominant brand which accounted for 60% of total garage door sales, the second brand which accounted for 30% of sales, and the weakest brand which accounted for 10% of sales. Since there are 50 exclusive dealers serving 50 markets and 300 non-exclusive dealers serving 100 markets that means that there are 3 non-exclusive dealers per market.
Exclusive dealers accounted for 70% of total…

More about Pyramid Door Case Analysis