Bolster Electronics
Bolster Electronics: Dealing With Dealer Demands
SITUATION ANALYSIS
Northern Alberta, the oil sands development area surrounding Fort McMurray, is the fastest growing economic area in Canada for several years. Obviously Bolster’s total market share in this area was the highest with one third of the total market share it held national wide. Vickers based in Edmonton, Alberta covered 50% of the local market share and 75% of servicing in that area in spite having a national distributor, National Electronics (National). Also local firms preferred to do business with Vickers than National which has their nearest warehouse in Calgary, Sothern Alberta around 750 Km from Fort McMurray. (Exhibit 1)
Neither Bolster nor National had a video system design team in northern Alberta. Since one third of the total market share is concentrated in northern Alberta, it is imperative to have a system design team there. If not it leads to a huge potential loss because there are competitions among the top 4 players who have 15% of the market share each. The management tried to convince National to work in northern Alberta in 2007 but it went vain. At the same time Vickers was well established in northern Alberta, its main office, warehouse and engineering team are in Edmonton with a warehouse and sales team in the proposed oil sands area of Fort McMurray which is a six hours drive from Edmonton.
Vickers is in the business for the past 20 years and their salespersons were highly trained and serviced the northern Alberta more effectively than national distributors. This is what the customer exactly wants in terms of good track record and service support in addition to lowest price. They also proved as an effective dealer by taking responsibility of warehouse, inventory storage, engineering expertise and services, relationship with local dealers and end-users, and increasing the Bolster’s business in their area. Hence they requested Bolster a better pricing discount and wanted
SITUATION ANALYSIS
Northern Alberta, the oil sands development area surrounding Fort McMurray, is the fastest growing economic area in Canada for several years. Obviously Bolster’s total market share in this area was the highest with one third of the total market share it held national wide. Vickers based in Edmonton, Alberta covered 50% of the local market share and 75% of servicing in that area in spite having a national distributor, National Electronics (National). Also local firms preferred to do business with Vickers than National which has their nearest warehouse in Calgary, Sothern Alberta around 750 Km from Fort McMurray. (Exhibit 1)
Neither Bolster nor National had a video system design team in northern Alberta. Since one third of the total market share is concentrated in northern Alberta, it is imperative to have a system design team there. If not it leads to a huge potential loss because there are competitions among the top 4 players who have 15% of the market share each. The management tried to convince National to work in northern Alberta in 2007 but it went vain. At the same time Vickers was well established in northern Alberta, its main office, warehouse and engineering team are in Edmonton with a warehouse and sales team in the proposed oil sands area of Fort McMurray which is a six hours drive from Edmonton.
Vickers is in the business for the past 20 years and their salespersons were highly trained and serviced the northern Alberta more effectively than national distributors. This is what the customer exactly wants in terms of good track record and service support in addition to lowest price. They also proved as an effective dealer by taking responsibility of warehouse, inventory storage, engineering expertise and services, relationship with local dealers and end-users, and increasing the Bolster’s business in their area. Hence they requested Bolster a better pricing discount and wanted