Dillon Control Group

Dillon Control Groups

Executive Summary

Dillon Controls created AquaWatch System, which is computer hardware and software that monitors and controls pressurized water flows. AquaWatch generated 70% of its sales from Ontario and Quebec, but the company was considering opening a branch in Vancouver to simplify its sales on the west coast, or consider tapping into the US market (Pennsylvania and New York) where they believed their product would noticeably increase their profits. Dillon Controls then hired Browning Group to do some market research. The research was broken into two phases; five one-hour interviews with water and sewage engineers, and a questionnaire done over the phone with utility managers, engineers and pumping operators in the Pennsylvania area. After completing the market research, Dillon Controls realized hat the sample size was too small, and no engineers or managers where contacted from the state of New York. Dillon Controls decided to remain in the Canadian market, as well as continue their specific research, which would take another three years to complete and cost $40,000.

Alternatives

Risks

Opportunities

1. Enter the U.S market

- Existence of possible strong competitors in the market. (incomplete research)

- Possible rejection of the product by managers or engineers in U.S. (incomplete research)

- Existence of possible regulations in each U.S state that would limit the penetration or the sales. (incomplete research)

- Risk of not reaching to the required profit margin, 35% in two years in U.S.

- The North American Free Trade Agreement; eliminated tariffs on computer products. This lead to more Canadian companies to look southward

- The North American Free Trade Agreement; eliminated tariffs on computer products, leads to have fewer costs.

- Product is recognized by U.S experts: U.S industry experts welcomed Dillon Controls' products and knowledge.

- Existence of less problematic transportation systems and payment arrangements with U.S

- Existence of a market that safety of product is more important than the price. (technological competition)

- Increase in profit

- Network opportunities

2. Sell to Canadian Companies

- Least riskiest decision