Case Analysis on OEL

Case Analysis on OEL - Case Analysis On Ontario Engineering...

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Case Analysis On Ontario Engineering Limited Executive Summary Ontario Engineering Limited (OEL) was a privately owned company that manufactured and wholesaled products to the residential heating and ventilating industry . As president of Ontario Engineering Limited, Mr. Paul Kirkpatrick met problems when he pondered the future course of his company in February 1989.
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And the major problem should be the difficult situation of his company which was because they were involved in two different kinds of activities-manufacturing and wholesaling. They manufactured sheet metal products for the heating and ventilating industry, which accounted for only 35% of their total sales volume. However, most of their remaining volume was made up of other heating and air conditioning equipment that they didn't manufacture, but did buy and resell as wholesalers. They acted as wholesalers for a full line of heating and air conditioning equipment, so most other wholesalers would not stock their manufactured sheet metal products due to the competition. Mr. Kirkpatrick also assumed responsibility for its marketing activities. He was particularly concerned about Ontario Engineering's declining profit position in recent years, and felt that at least part of the answer to this problem may lie in making some basic changes in marketing. So how to change the current marketing style should be the major problem he was facing. Statement of the Problems About the short term problem, in 1988, 35% of corporate sales volume was derived from manufactured sheet metal products, 9% from humidifiers, and 56 % from resale items. These proportions had remained virtually unchanged during the period of Mr. Kirkpatrick's ownership of the company. It is the major problem as well as a big short term problem now. The root cause of the problem should be the low manufactured technique and low-level machines in the factory, as well as the high competition on manufacturing. The industry was not highly automated, and the machinery and skills required were not
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particularly complex or expensive. And they had a lot of competitors. So the problem appeared then. In addition, another short term problem should be Ontario Engineering's declining profit position in recent years. And the root cause of the problem should be high levels of selling and delivery expenses, administrative expenses, and miscellaneous. Certainly, it was also because of the sales, too. In a long term, the problem might be competitive force in the market in order to get more net profits. Due to huge amounts of competitors in both manufactured sheet metal products and resale items, it was so significant for OEL to change their marketing plan that they could be more competitive than others, simply, it was to be able to gain more profits. The root causes of this problem were the marketing organization. The five-person sales company did not have enough force to handle such a big area of customers. In addition, the duties of the salesman were so flat that they could not focus on one kind of
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Case Analysis on OEL - Case Analysis On Ontario Engineering...

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