Baxton Case Analysis

I. Factual Summary: * Baxton Technology has a reputation for quality products, primarily in the wheel alignment segment. * By 1999, Baxton had sold 1,054 hoists and had sales of 9,708,000. 60 percent of the sales were in US, and 40 percent were in the Canadian market. The total number of hoists sold in the U.S was 632 for a sales figure of $5,824,800. However, the total number of hoists sold in Canada was 422 resulting in a sales figure of $3,883,200. * Sixteen companies competed in the automotive lift market in North America; 4 in Canadian, and 12 in the United States. The industry is dominated by two large U.S. firms, AHV lifts and Berne Manufacturing. AHV lifts has 40 percent of the market share and Berne manufacturing has 20 percent of the market share. * Approximately 49,000 hoists were sold each year in North America. Baxton Technology holds 1.29 percent of North American hoist market. * The European market is large and has little internal barriers. Establishing a firm in Europe can help Braxton increase global market share and profits due to fewer barriers for companies’ operating in the European Union means a reduction in tariff costs. * Baxton deals with US automotive wholesalers to represent the company in the United States; the wholesaler carries the Baxton lift and 4 other lifts. * Purchase decision is based on the type of hoist needed, and then the brand, although the buyers are not very knowledgeable with brands and products currently available out there.

II. Case Problem/ Opportunity:
Baxton Lift Company is studying whether operating in the European market will increase the growth of the company, or staying focused on the U.S. market that has unrealized potential is more profitable.
Baxton manufactures surface automotive hoists, a product used by garages, service stations, and other repair shops to lift cars the servicing. Before making a decision, Baxton must consider many facts in order to understand the