Effective Case Study Analysis for EMR Innovations Case Study Solution
Economic growth
During the 2008 recession period, the industry of recreational vehicles has taken a massive hit but witnessed substantial growth since then. Aided by the growing popularity of van life movement and broader economic recovery, the RV industry is significantly recovered. The recreational vehicle industry had a positive economic forecast and an impact on the economy of the US. The target market of the industry is affluent, active & consumption oriented consumer groups. The substantial disposable income, active lifestyle and increased life expectancy most likely contribute to their strong demand for RVs. The low rate of interest encourages people to purchase leisure and big ticket items.
The RV industry surely holds promises as the baby boomers and the younger generation are more inclined to spend a considerable amount of money on experiencing that RV delivers. If the economy ofthe country remains strong and stable and continues to grow in the future, the sales of RV would likely get a boost, whilst improving the stock performance within an industry(Ph.D., 2001).
Target Markets for the Lock-Awn Anti-Billowing Device
Needs
The target Markets for the Lock-Awn Anti-Billowing Device need to be characterized by EMR innovations through the determination of their objective, introvert as well as interpersonal needs.
Identification
EMR Innovation needs to identify the products with a diverse customer base including millennials, baby-boomers, students, nature enthusiasts, employees and so forth.
Attractiveness
Launching an innovatively new product or service to the market most likely requires the changes in the business model; for example, if the product is complex it would require offer different distribution channels, installation service assistance or extended repair warranty conditions. In addition to this, the business model should be the focus of the innovative concepts implying changes in the product. EMR Innovation should explore the dynamics of innovation being comfortable with making rapid adaption for staying on the top of the change within the industry. Incorporating the uniqueness and innovation in the product would allow the company to gather a larger customer base.
Profitability
EMR Innovation is recommended to follow the Pareto Rule to determine which areas to focus its efforts and resources to achieve great success with the least possible efforts. With better time management and the right priorities, the company would be able to work more purposefully and efficiently. By using the 80/20 rule, each employee would be prioritizing their task and responsibilities so that they could direct their concentration on critical 20 percent thatwouldgenerate 80 percent ofoutcomes.
Positioning
The positioning of the product in the market needs critical assessment of characteristics of customers and seeking ideas for their perception that would help in modelling the positioning strategy.
FinancialAnalysis
In consideration of the financial analysis, the 0.5% rate of return is used to calculate the revenues of the company which amounts to $1374100. The total fixed cost includes onetime production cost, office equipment cost, assembly and packing equipment, product liability insurance, building lease and utilities. Combining all these costs amounts to $65433.33. The variable costs include material cost, packing cost and labor cost amounts $88326.
The sales units of 7010 are used to calculate the breakeven in unit and revenue. The breakeven point in units of the company is103862 where if the sales are higher than expected by 25%, the breakeven point would be 16617.99. Also, if the sales are lower than expected by 25% the breakeven point would be reduced by 24438. Additionally, if the sales are higher than expected by 50%, the breakeven point would be 9031.51 and if the sales are lower than expected by 50%, the breakeven point would be 10932. With the selling price of 13.23, the company would generate $1374100 from the sales of the breakeven quantity.
Reducing the sales of the product either by 25% or 50% would lead to reduced profits. So, the company is suggested to increase the price of the product in the future due to the strong economic growth & rising buyer’s power and inclination of customers to purchase the product. The calculations can be seen in appendices.
Marketing mix
The company intended to launch the innovatively new product or service to the market and incorporate the uniqueness and innovation in the product would allow the company to gather a larger customer base. The target market of the industry is affluent, active & consumption oriented consumer groups. The selling price of the product would be 13.23 because it would generate $1374100 from the sales of the breakeven quantity. As the product in its early lifecycle stage, Eric and Mary are recommended to develop the chat room discussion, promotional brochures and word of mouth to market the product, as it would be an efficient way to attract the customers at a lower cost.
Additional Required Information
Before seeking to finance the business operations i.e. new product development, Reynolds should assess the viability and acceptability of the product in the market. They should evaluate the feasibility of the project and annual cash flows generated from selling products. Examining the credit score before applying for funds is fundamental to assess the creditworthiness of the company. They should also collect the information about collateral that the financial institution would accept to guarantee and secure the loan. Knowing the value that would be offered to investors for their investment in the company is essential to increase the odds of securing the needed capital (Hall, 2012).
Recommendations& Conclusion
From the standpoint of qualitative analysis, it is analyzed that the market is strong and growing, hence providing long term profits potential for the business. The favorable economic conditions and preference of customers towards the private mode of transportation with reference to comfort options in the recreational vehicle provide the opportunity to Eric and Mary to tap the market opportunity and being optimistic about the approval and acceptance of the product in the market.
The most feasible option for product distribution is the individual dealers from the Workampers group. It seems to be the best option for them with their larger number of members as their target would be reaching at ease. As the product in its early lifecycle stage, Eric and Mary are recommended to develop the chat room discussion, promotional brochures and word of mouth to market the product, as it would be an efficient way to attract the customers at a lower cost. Beginning out small would most probably help the product to grow as well as reach its full potential.................................
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