The Clifton Industries Case Study
The current situation of our company
Table 1 the comparison between North American and European market | market | Competition | volume | margins | lead times | price | North American | Huge | significantly more competitive | Huge | | shorter | More price-sensitive | European | | | smaller | satisfactory | | Pressure on price |
The characteristics of its marketing
1 two major market areas: The first was to supply products of a type similar to our current electromechanical designs to North American aircraft manufacturers. The second was to design and manufacture electronic products for Europe and North America.
2 time was pressing. the lead time between contracts being signed and initial deliveries got increasingly shorter.
3 The U.S. market (dual sourcing) is already served by four large companies, all U.S.-based, with sound experience and highly competitive. the volume provides for low-cost manufacturing. With dual sourcing, delivering on time is now even more important, as failure would directly affect our supplier rating and hence future sales.
4 merit: There are not many European suppliers who have an electronics capability—in terms of design through to manufacture, so less competitors. Our decision to go into electronics was almost preordained. Margins on electronic products were similar to existing OE contracts.
Table2 | electromechanical business | Electronics | | OE Requirements | Spares and repairs | | market | No growth | decline | large | margin | | High | high | Competition | | | |
From table 2,
1For electronic products, it has large market in the future. The market is potentially very large with apparent high profit margins at least at the early stages. What is more, there are not many European suppliers who have an electronics capability—in terms of design through to manufacture, so less competitors we have. Orders are won at this time on the technical merits of the product, not on price.
Table 1 the comparison between North American and European market | market | Competition | volume | margins | lead times | price | North American | Huge | significantly more competitive | Huge | | shorter | More price-sensitive | European | | | smaller | satisfactory | | Pressure on price |
The characteristics of its marketing
1 two major market areas: The first was to supply products of a type similar to our current electromechanical designs to North American aircraft manufacturers. The second was to design and manufacture electronic products for Europe and North America.
2 time was pressing. the lead time between contracts being signed and initial deliveries got increasingly shorter.
3 The U.S. market (dual sourcing) is already served by four large companies, all U.S.-based, with sound experience and highly competitive. the volume provides for low-cost manufacturing. With dual sourcing, delivering on time is now even more important, as failure would directly affect our supplier rating and hence future sales.
4 merit: There are not many European suppliers who have an electronics capability—in terms of design through to manufacture, so less competitors. Our decision to go into electronics was almost preordained. Margins on electronic products were similar to existing OE contracts.
Table2 | electromechanical business | Electronics | | OE Requirements | Spares and repairs | | market | No growth | decline | large | margin | | High | high | Competition | | | |
From table 2,
1For electronic products, it has large market in the future. The market is potentially very large with apparent high profit margins at least at the early stages. What is more, there are not many European suppliers who have an electronics capability—in terms of design through to manufacture, so less competitors we have. Orders are won at this time on the technical merits of the product, not on price.