Introduction: Haverwood Furniture‚ a medium-to high-priced manufacturer of wood furniture for bedrooms‚ living‚ and dining rooms‚ has just acquired Lea-Meadows‚ Inc. Lea-Meadows is a manufacturer of upholstered living and family room furniture. A decision now needs to be made concerning the selling approach. Haverwood has 3 options: Give the upholstery line of chairs and sofas to the current sales force. Continue to use Lea-Meadows sales agents. Merge the sales representatives together.
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Amy Weaton Professor Drago Haverwood Furniture Haverwood Furniture Individual Summary Introduction: In 2008‚ Haverwood Furniture and Lea-Meadows Inc. merged into one company. The issue at hand involves merging the selling efforts of the two companies. They both go about selling their products differently and the best plan of action is uncertain. John Bott‚ of Haverwood‚ believes that Haverwood sales representatives implement the best selling strategy whereas Martin Moorman‚ the national sales
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Haverwood Furniture‚ Inc I. Summary of Facts A. Market – Furniture Industry 1. Customers a. Retailers b. Older crowd 45-65 year old c. Public crowd 2. Purchasing Furniture a. Consumers b. Price c. Promotion d. Looks 3. Economic market – Monopolistic Competition B. Product 1. Haverwood Furniture a. Furniture that’s easy to assemble b. Wood tables c. Everyday furniture d. Different types of styles 2. Benefits a. Priced aggressive to show that furniture is good quality b. Product looks distinct
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about 30% of the industry sales. As I said above‚ the furniture industry is cyclical‚ any change in disposable income‚ new housing starts‚ consumer confidence‚ and disposable personal income will have a dramatic effect on the furniture industry. Haverwood relative position in this industry is a high quality wood furniture manufacturer. They pride themselves on distributing their product to 1‚000 high quality department stores nationwide. Since they have a high quality product they do not distribute
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Haverwood Furniture Inc. (B) Background on the merger In April 2008 Haverwood Furniture merged with Lea-Meadows‚ a manufacturer of upholstered furniture for living and family rooms. The merger was not planned in any conventional sense. The merger proceeded smoothly since the two firms were located on adjacent locations and the two companies would maintain as much autonomy as was economically justified. The only real issue that still remained was merging the selling efforts. The question was straight-forward
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and knowledgeable but not pushy Consumer tendencies: Associate high price with high quality Get redecorating ideas or guidance from magazines Read furniture ads before actually needing furniture Enjoy buying furniture somewhat or very much Haverwood Furniture‚ Inc. Background Wood furniture manufacturer Medium- to high-priced items Bedroom‚ living room‚ and dining room furniture Financial standing 2008 contribution margin will be 20% Company objective of 5% net profit margin before taxes
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Haverwood Furniture‚ Inc. Q1 How would you characterize the HH wood Furniture Industry? • Haverwood L Room & Bedroom • Haverwood has own sales force 10 sales/ 2 Reg • Upholstered 50%/ Wood 40% • Total Ind Sales 3 Mil • Top 10 Wood Manu = 1/3 of total sales • Asia imports driving down prices (BPuerto) • US Manu downsized – 100 Manu • $15 million sales = 6% mkt share • Hwood uses 1000 specialty style (Selective distribution) • Gallery concept prevalent • Do not have full line in all
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economic conditions which may directly impact a consumer’s purchasing power. A few furniture companies have decided to outsource different process in order to be cost effective. 2. What is Haverwood’s relative position in this industry? Haverwoods position in the industry is reflected in the product it produces. It is a mid to high price furniture manufacture. Its sales are good with a least six percent of market share. The growth of the company is expanding with the addition of Lea-meadows
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Case: Harverwood Furniture‚ Inc (A) Eduardo Barroca de Moura 04/09/2015 1. State the Central Strategic Issue A. State the central strategic issue identified in your situation analysis. Haverwood needs to decide whether go with their agency ad suggestion or else. Mike Hervey‚ from Hervey and Bernham suggested increasing their expenditure by $225‚000 by 2008‚ through various shelter magazines ads. However‚ that approach is lightly out of line with the current policy of budget of 5% of expected sales
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