Image is a key factor in making in-roads into the higher echelons of interior designers. Their work is desirable because it is less price-sensitive. Cutting Edge Drapery's strategy is to lift its image, through advertising in prestigious trade publications, joining and net-working ASID membership, and actively marketing a selected group of 15 interior designers located in close proximity to the company's target market area.
The company seeks to establish a competitive edge in its new target market segment by increasing the level of customer contact and service that other competitors seem to oftentimes lack. Additionally, Cutting Edge Drapery possesses the necessary skills to produce the high quality products that are needed in this field. The establishment of the previously mentioned work processes that will ensure greater service will strengthen the contacts that promote word of mouth marketing and networking.
As mentioned in the previous section, it is important to the marketing strategy to develop an attractive image to the trade. This can be done in a number of ways:
In addition to the above-mentioned activity designed to elevate the company's image, it is essential to market directly the selected 15 target clients who are all members of ASID. Most of them are associate members while some are professional members. Success in making in-roads into these names would set the stage for entry into the more prestigious Boston designers.
Marketing these prime prospects must be carried out in a thoughtful organized way. Color literature including the newly designed logo should be completed as a first step. When marketing these prospects it will be important to present a portfolio of Cutting Edge Drapery's most innovative work. A relaxed face-to-face meeting, resulting in good communication between designer and the owner, should be all that's needed to generate a first order.
Networking is also very useful. It is important, once the logo and artwork materials have been completed, for the owner to make a point of introducing herself to important players in the design world surrounding Boston. A good example is major upholstery businesses, custom carpets, suppliers of tile, etc. who often need to color-coordinate or fabric-coordinate with workrooms.
Pricing of workroom products is not cut and dried. An attempt was made to compare prices charged by various workrooms. Three rather generic items were chosen and interior designers were asked to submit prices based on what their workrooms charge. The three items were:
The few respondents quoted:
* * All names have been omitted for confidentiality purposes.
The fact that so few designers contributed to the survey is an indication of the relative unimportance of the workroom cost. The fact that only one was willing to share the name of his/her workroom is an indication of how close to the chest designers/decorators hold their cards in respect to workrooms. Cutting Edge Drapery's pricing, based on the scheme mentioned elsewhere in this plan, and which is used for purposes of financial projections, places the company slightly below the average for item one, slightly over the average for item two, and 30% more expensive for item three. None of the respondents quoted prices charged by the high-image workrooms (see section on competition) which have been tagged as members of a community of workrooms to which the company would like to belong. All indications, based on numerous interviews, is that prices charged by the more prestigious workrooms are at least double the prices of the company, and perhaps even more.
In view of the image that Cutting Edge Drapery intends to create, consistent with its quality and skill level, it is advisable from a marketing point of view not to try to be the cheapest price-wise.
The marketing strategy discussed previously in this business plan will generate the desired sales. These sales will begin with a phone call to Cutting Edge Drapery. It is a stated objective to transfer the administrative burden away from the owner, freeing up her time to meet with clients, to network at ASID and Design Center functions, and to market the list of 15 prospective clients. This means that someone else will be answering the incoming calls. This person must be carefully trained to recognize who must be called back immediately by the owner. The interior designer needs--and expects--close contact with the workroom principal. The designer is under pressure to get a quotation together, for example, and being told that "she isn't here right now" is not going to foster sales. The owner must be armed with a cell phone and a pager. The important caller should be told that the owner will "call right back." The more successful the marketing strategy is in making in-roads into the designer share of the workroom market, the more important this communication response will become.
In respect to the prospect list of clients, it is essential that a "salesman's" approach be adopted to insure an organized, orderly approach to each prospect. Notes need to be kept on each client. Follow-up and persistence will pay off.
The Sales Forecast is divided up into the major categories of sewing products the workroom creates. Unit sales includes the yearly forecast of each unit per category, based on an average of 10-15 labor hours per item and forecasted capacity given the personnel changes mentioned in the Personnel Section. The unit prices reflect the average cost per item, based on past pricing strategies. Since the company deals with providing custom services, this can vary wildly between items. Due to target market shift, estimated increase in unit prices is reflected in years 1999 and 2000. Direct unit costs reflect direct costs in producing the items but does not including labor and fabric.
It is estimated that by year 2000, revenues will reflect an 11% market share of the local soft window treatment market.
Cutting Edge Drapery has a big year forthcoming. In order to achieve the sales and marketing goals that have been outline in this business plan, the company has deadlines to meet and ideas to implement. Some of these are outlined below: