Curled Metal Inc. Marketing Case Write-Up

Curled Metal Inc. Marketing Case Write-up

Based on total savings, what is the economic value to the customer, per pad, to that customer?

By using total hours per job we can figure out the cost per hour and total job and equipment cost. And then comparing the profits of the jobs by subtracting the cost from the revenue. It was clear that using CMI pads had a total cost savings of 22246 dollars.  By adding the total cost saving plus the cost of conventional pads per job and divided by the number of CMI pads used. We get an EVC of 4207 per pad.

We assume that the customer would be willing to pay more than what they are already paying. It would be pointless to set a per pad price, instead a pad set price because 3000 per set is what the customer is already paying. Not to lose the product attractiveness, it is recommended per set price of 3500, which means 583 per pad. We also assume curled metal set life of 10 times more than conventional pads, and a performance increase of 20%        

There are also safety benefits of using the pad, which will also serve as attractive features for customers to make the purchase.

        Kendrick                        Conventional   CMI

Total hours per job                                                      107          75

Diesel hammer        102                                10880         7657

Overhead        300                                32000         22520

Labor                122                                13013         9158

Leads                24                                2560         1802

Crane                156r                                16640         11710