Dominion Motors case Composition

Dominion Engines case

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LAND MOTORS AND CONTROLS, LIMITED.

Case Information:

Dominion Motor and Controls, Ltd. (DMC) was a organization producing motor of differing horsepower (hp) and other accessories for power generators like electric motor control and panel-board devices DMC was facing a threat of loss in market share because of some assessments by Hamilton Oil Firm – the greatest Canadian essential oil company The results of such tests weren't yet reported, but they had been rumoured to help make the complete engine market include some critical changes in the style of their motor in terms of starting torque, fluid-lifting requirements etc . and therefore, boost efficiency Mastery Motors and Controls, Limited. (DMC), had over fifty percent market share inside the Canadian petrol fields with a revenue of $323 million. The company's parts of difference were: 1 . Product quality

2 . Good salesperson (one)

a few. Varied horsepower motors

Mastery Sales:

1 . 80% of DMC's revenue were made immediately by provider's salespersons to OEMs and enormous industrial users. 2 . 20% of the sales were made to distributors pertaining to resale generally to little users and small OEMs.

Obtaining pattern were seasonal which started in 04 to Sept. 2010 Competition

Even though it is a very fragmented industry with many small players there were simply 3 significant players through this industry: 1 ) Spartan Engines

2 . Common Motors

a few. Dominion Motors

People involved with Buying Behavior:

Operations persons: They are usually influencers, users or buyers Engineers and Purchasers: Buyers

Geologist: Influencers

Standard Functionaries: Influencers and Gatekeepers

Rig Administrators and honcho, chief, gaffer boss: Very important influencers

PROBLEM:

To evolve a strategy for Dominion motors in order to maintain their particular competitive edge and business in the essential oil well water removal market Elements affecting the sales:

NEMA specifications: Almost all companies try to exceed these kinds of specifications to be sure that they continue to be competitive nevertheless the equipments are all safe. Any kind of alterations in the design of the motors will probably cause Mastery to fall season below the required specifications since given by NEMA Low winter season temperature: Since the temp in Canada had been extremely low in winters, the drillers needed extra torque to get the machine started. It was needed simply by all the firms. Electricity charges: A new changing mode of charges was introduced pertaining to electricity consumption. As per these types of changes using a higher horsepower motor was to get a lower cost for electric power. Thus the highest cost to get electricity will be incurred by the motor with lowest hewlett packard rating. Overmotoring: The government bodies realised that in order to reduce the torque necessity many companies employed a higher hewlett packard motor although a lower hp motor can easily find the oil for the surface. It was now charged and penaly was to be used on all those who had been found doing over car. Alternatives:

ALTERNATIVE 1:

Decrease the price of 10hp engine to match that or the 7. 5 hewlett packard motor. Advantages:

This is a short term fit in so that it will maintain competitive advantage for the buying season which was about to start It had been an extremely quick way to reply to client needs

No extra investment will be required for this option since no alterations are being done to the unit or the production Implementing this method is extremely convenient, and there would be few problems Cons:

It will be more pricey for the company as they must cut within their own margins. Profits decrease by $342 per device. Once they decrease the price, they do not be able to increase it back for the original value, thus they may have to decrease other prices as well While using power corporations penalizing buyers for over-motoring, it is skeptical if the buyers would easily accept using a high hewlett packard motor whether it is not needed

SP

Manufacturing Price

Sales Comm & Transfer (10% of SP)

Total

Profit

Current

1580

907. 8

158

1065. almost eight

514. two

Future

1200

907. almost eight

120

1027. 8

172. 2

OPTION 2:

Slightly change the design of the several. 5 hewlett packard motor

There are two ways by which this...