Fulham Furniture Manufacturer--UK
Strategy and Implementation Summary
We focus on a special kind of customer, the person who wants very high quality office furniture customised to work beautifully with modern technology including personal computers, scanners, internet connections, and other high-tech items. Our customer might be in larger comanies, small or medium business, or in a home office with or without a home-office business. What is important to the customer is elegance, fine workmanship, ease of use, ergonomics, and practicality.
Our marketing strategy assumes that we need to go into specialty channels to address our target customer’s needs. The tie-in with the high-end quality catalogues like XXX is perfect, because these catalogues cater to our kind of customers. We position as the highest quality, offering status and prestige levels of purchase.
The product strategy is also based on quality, in this case the intersection of technical understanding with very high quality woodworking and professional materials, and workmanship.
Our most important competitive edge is our assembly strategy, which is based on interlocking wood pieces of such high quality that assembly is not only a pleasure for our customers, it is actually a feature that enhances the sense of quality.
5.1 Strategy Pyramid
Our main strategy at Fulham Furniture Mfr. is to position ourselves at the top of the quality scale, featuring our combination of superb technology and fine old-fashioned woodworking, for the buyer who wants the best quality regardless of price. Tactics underneath that strategy include research and development related to new designs and new technology, choosing the right channels of distribution, and communicating our quality position to the market. Programmes are mainly those listed in the milestones table, including new design programmes, new equipment to keep up with design, channel development, channel marketing programmes, our direct sales, and our continued presence in high-end catalogue channels and new presence in the web.
5.2 Value Proposition
Fulham Furniture Mfr. gives the discriminating personal computer user, who cares about design and quality furniture and quality of working environment, a combination of highest quality furniture and latest technology, at a relatively high price.
5.3 Competitive Edge
Our competitive edge is our dominance of high-technology ergonomics and traditional high-quality furniture workmanship. Although there are many computer furniture manufacturers, and many computer lovers, few have brought the two crafts together as we have.
5.4 Marketing Strategy
Our product is positioned very carefully: this is high-quality office furniture combining workmanship and ergonomics for the customer who understands quality, is a user of high technology equipment, and is willing to spend money on the best. Unlike the mainstream products, we do not use laminates or cheap manufacturing technology.
Our marketing strategy is based mainly on making the right information available to the right target customer. We can’t afford to sell people on our expensive products, because most don’t have the budget. What we really do is make sure that those who have the budget and appreciate the product know that it exists, and know where to find it.
The marketing has to convey the sense of quality in every picture, every promotion, and every publication. We can’t afford to appear in second-rate catalogues with poor illustrations that make the product look less than it is. We also need to leverage our presence using high-quality catalogues and specialty distributors.
5.4.1 Pricing Strategy
We will maintain our pricing position as a premier provider. We are the best product available, for the most discriminating consumer. We intend to maintain our separation from the price competition at the lower end of the business. Our plan calls for no significant changes in pricing.
5.4.2 Promotion Strategy
Our most important vehicle for sales promotion is the direct mail catalogue published by the specialty retailer such as Sharper Image and its competitors. Our advertising budget goes mainly for space in the specialty catalogue.
We also participate in major industry events, including both the Spring and Fall national computer furniture shows and the fall computer show. Our total budget for events is £XX,000 plus about half of the travel budget.
This year we will also promote our products with an in-house catalogue including our own products plus related merchandise of interest to the same target market.
5.4.3 Distribution Strategy
Our most important marketing programme is [specifics omitted]. Ivy Bells will be responsible, with budget of £XX,000 and milestone date of the 15th of July. This programme is intended to [objectives omitted]. Achievement should be measured by [specific concrete measurement].
Another key marketing programme is [specifics omitted]. [Name] will be responsible, with budget of £XX,000 and milestone date of [date]. This programme is intended to [objectives omitted]. Achievement should be measured by [specific concrete measurement].
5.4.4 Positioning Statement
For discriminating personal computer users who want to integrate their PCs with fine furniture, the Fulham line offers exquisite workmanship and design combined with state-of-the-arts ergonomics and technology. Unlike the Devonbrooke line, Fulham Furniture makes no design compromises for standardisation.
5.5 Sales Strategy
Our strategy focuses first on maintaining the identity with the high-end buyer who appreciates the best available quality, but is also very demanding regarding computer systems and technology. We’ve been able to find these customers using a combination of direct mail catalogues and direct sales to distributors.
For the next year we continue to focus on growing presence in the high-end direct mail catalogue that finds our specialty customer. We will work with XXX and YYY more than ever, and we expect to gain position in the major airline catalogues as well. Specialty retail is a new channel that could become important for us.
Our work with distributors has been promising. We hope to continue the relationship with distributors selling directly to larger comanies, even though this takes working capital to support receivables.
5.5.1 Sales Forecast
Our sales forecast assumes no change in costs or prices, which is a reasonable assumption for the last few years.
We are expecting to increase sales vigorously in the next year, about doubling in size. The growth forecast is in line with our last year, and is relatively high for our industry because we are developing new channels. In 2007 and 2008 we expect growth closer to 50% per year, to a projected record total in 2008.
We are projecting significant change in the product line, or in the proportion between different lines. The key to our growth is the growth of the new channels, with the main desk.
Our seasonality, as shown in the chart, is still a factor in the business. We tend to sell much better in Spring and Fall, and sales drop in the summer.
|Executive desk oak||209||350||600|
|Executive desk cherry||31||30||30|
|Other furniture oak||45||50||50|
|Other furniture cherry||7||10||10|
|Total Unit Sales||298||450||700|
|Executive desk oak||£1,600.00||£1,600.00||£1,600.00|
|Executive desk cherry||£1,750.00||£1,750.00||£1,750.00|
|Other furniture oak||£900.00||£900.00||£900.00|
|Other furniture cherry||£1,000.00||£1,000.00||£1,000.00|
|Executive desk oak||£334,400||£560,000||£960,000|
|Executive desk cherry||£54,250||£52,500||£52,500|
|Other furniture oak||£40,500||£45,000||£45,000|
|Other furniture cherry||£7,000||£10,000||£10,000|
|Direct Unit Costs||2006||2007||2008|
|Executive desk oak||£400.00||£400.00||£400.00|
|Executive desk cherry||£525.00||£525.00||£525.00|
|Other furniture oak||£180.00||£180.00||£180.00|
|Other furniture cherry||£300.00||£300.00||£300.00|
|Direct Cost of Sales|
|Executive desk oak||£83,600||£140,000||£240,000|
|Executive desk cherry||£16,275||£15,750||£15,750|
|Other furniture oak||£8,100||£9,000||£9,000|
|Other furniture cherry||£2,100||£3,000||£3,000|
|Subtotal Direct Cost of Sales||£113,825||£174,000||£274,000|
5.5.2 Sales Programs
Specific sales programmes:
- Catalogue sales: develop placement with one additional catalogue catering to the high-end office executive, paying of course for space and positioning. The budget is £10,000 for this programme, due March 15, with Jan responsible.
- Distributor sales: we need to develop at least new distributor, spending for co-promotion as required, and making direct sales calls. The specific responsibility is Jan’s, and due date is May 15, with a budget of £15,000.
- Direct sales: we will do a mailing of a new in-house catalogue, developed by the marketing department, to add to our direct telephone sales. Jan will be responsible, without a budget or a deadline because the catalogue is a marketing programme.
5.6 Strategic Alliances
The accompanying table shows specific milestones, with responsibilities assigned, dates, and (in most cases) budgets. We are focusing in this plan on a few key milestones that should be accomplished.
|Milestone||Start Date||End Date||Budget||Manager||Department|
|Third catalogue placement||5/15/1998||6/15/1998||£54,000||Jan||Ads|
|Our in-house catalogue plan||1/31/1998||2/28/1998||£0||Terry||Other|
|In-house catalogue design||4/1/1998||5/1/1998||£2,000||Terry||Other|
|In-house catalogue mailing||5/1/1998||6/1/1998||£5,000||Terry||Other|
|Laptop product test||6/15/1998||6/20/1998||£1,000||Jim||Other|
|Laptop product release||1/1/1998||10/15/1998||£15,000||Terry||PR|
|Spring trade show||1/1/1998||5/15/1998||£10,000||Terry||PR|
|Fall trade show||5/15/1998||10/15/1998||£8,000||Terry||PR|
|Fall trade show||5/15/1998||10/15/1998||£20,000||Terry||Events|
|Spring trade show||1/15/1998||5/15/1998||£20,000||Terry||Events|
|Spring trade show||1/15/1998||5/15/1998||£6,000||Terry||Travel|
|Fall trade show||5/15/1998||10/15/1998||£6,000||Terry||Travel|