MAkkL1ING II ASSIGNMLN1

CASL C1ICAL DIS1Ck1ICN INC

CCUkSL INS1kUC1Ck kCI k k IAASIMnA



WCkk SU8MI11LD 8 GkCU 9 SLC1ICN 8

An|rudh S|ngh 2011GS47
Ank|ta Sr|vastava 2011GSSS
8|shakha Ma[umdar 2011IM04
Mayank kumar 2011G718
kahu| Gaur 2011G808
S Shankar 2011G840
V|gnesh k 2011G93S






IDLN1IIICA1ICN CI 1nL kC8LLM

1he CpLlcal ulsLorLlon lnc ls a flrm operaLlng ln Lhe unlLed sLaLes of Amerlca whlch has come up wlLh
a new producL a conLacLlens for chlckens ln poulLry farms 1he lenses are deslgned Lo reduce Lhe
eyeslghL of Lhe chlckens 1hls ln Lurn helps ln curLalllng lnflghLlng and cannlballsm among Lhe chlckens
and also reduces feedlng cosLs Slnce Lhe producL reduces poulLry expenses slgnlflcanLly Lhe Cul
expecLs Lhe producL Lobehlghly popular among poulLry farmers ln Lhe unlLed SLaLes
As presenLed by Lhe case Lhe ma[or problems faced by Lhe Cul are as follows
1 1o declde on Lhe opLlmum launchlng sLraLegy of Lhe producL so as Lo derlve Lhe maxlmum
beneflLs ouL of Lhe flrsL mover advanLage whlle Lhe paLenL lasLs whlle keeplng ln mlnd Lhe
producLlon consLralnLs of Lhe flrm
2 1o declde on Lhe opLlmum prlce for Lhe producL glven Lhe value derlved from lL by Lhe poulLry
farmers
SI1UA1ICN ANALSIS
CCN1Lk1 CI 1nL kC8LLM
1he case deals wlLh Lhe CpLlcal ulsLorLlon lnc an upcomlng uS flrmLhaL ls golng Lo launch a new
producL a conLacL lens LhaL parLlally bllnds chlckens and Lhus helps Lo reduce wasLage and relaLed
cosLs ln poulLry farms
8ackground Informat|on
1he ldea for Lhe conLacL lens for chlckens evolved ouL of an ouLbreak of a caLaracL problem
among chlckens ln a farm ln Arlzona LhaLreduced Lhe vlslon of Lhe chlckens conslderably
Powever farmers found Lhe caLaracL Lo be a boon for Lhe followlng reasons
1 LCkING Chlckens of Lhe egglaylng age when kepL ln crowded cages Lend Lo develop
a soclal organlzaLlon ln whlch Lhe more domlnanL blrds hold Lhelr necks hlgh and Lend
Lo domlnaLe over Lhe more submlsslve blrds 1hls led Lo Lhe followlng problems
a lf a submlsslve blrd Lrled Lo dlsplay domlnanL behavlor lL was pecked back Lo
submlsslon by Lhe domlnanL blrds 1hls occurred Lo Lhe exLenL of cannlballsm
kllllng of chlckens resulLlng ln Lhe loss of producLlve chlckens and dlsLurbance ln Lhe
pecklng order
b 1he submlsslve blrds goL less chance Lo feed ln Lhe Lroughs and Lhus lald fewer eggs
ALLempLs have been made Lo counLer Lhe problem of cannlballsm by debeak|ng Lhe
blrds Powever Lhls has been found Lo be LraumaLlc for Lhe blrds affecLlng Lhelr egg
laylng capaclLles Also Lhls makes feedlng dlfflculL for Lhe debeaked blrds who have Lo
drool ln Lhelr food lurLher a debeaked chlcken could eaL only lf Lhe Lrough ls 3/8 lnches
deep resulLlng ln a wasLage of 078 pounds of food per 100 chlckens per day
2 Jhlle feedlng chlckens Lend Lo engage ln 'bllllng' Lhrowlng food ouL of Lhe Lrough
Chlckens LhaL cannoL see well are noL fussy and do less bllllng whlch agaln reduces
wasLage of feed

Jhlle Lhe caLaracL ls caused by geneLlc facLors and cannoL be caused humanly Lhe Cul came up
wlLh Lhelr conLacL lenses an arLlflclal means Lo repllcaLe Lhe effecLs of Lhe caLaracL whlle belng
less LraumaLlc Lo Lhe blrds 1he producL was successfully LesLed ln farms ln Callfornla and Cregon
leadlng Lhe owners Lo belleve LhaL Lhere ls an opporLunlLy Lo revoluLlonlze poulLry farmlng wlLh Lhelr
producL
MAICk MACkCLNVIkCNMLN1AL IAC1CkS
1 DLMCGkAnIC LNVIkCNMLN1 Lhe LargeLed cusLomers for Cul are Lhe poulLry farmers ln uS
1hey have shown openness and adapLlveness Lo new Lechnology lurLher Lhey are wllllng and
able Lo afford Lhe new Lechnology and lLs nuances
2 LCCNCMIC LNVIkCNMLN1 1he LargeLed cusLomers can flnance Lhe Lechnologlcal lnnovaLlons
and Lhe process of lenslng Lhe chlckens
3 1LCnNCLCGICAL LNVIkCNMLN1 Lhe Cul has lnvenLed Lhe conLacL lenses for Lhe chlckens and
hold Lhe paLenLlng rlghLs for Lhe nexL 3 years sLarLlng 1977 1hls glves Lhe farm Lhe flrsL mover
advanLage for 3 years before Lhe blg players arrlve
MAICk MICkCLNVIkCNMLN1AL IAC1CkS
1 SI2L CI 1nL IAkM 1he Cul presenLly has only 4 members all worklng parL Llme for Lhe
organlzaLlon Clven Lhe large poLenLlal markeL of Lhe flrm lL ls dlfflculL Lo caLer Lo such a large
markeL wlLh a small work force Pence expanslon may be needed
2 CAI1AL 1he flrm has llmlLed flnanclal resources whlch prevenLs lL from launchlng Lhe producL
on a naLlon wlde scale golng lnsLead on a reglonbyreglon rollouL Powever Lhe producL has Lo
be prlced adequaLely so LhaL Lhe early launches can be used Lo flnance Lhe markeLlng aL a laLer
sLage
3 SULILkS 1he Cul has a conLracL wlLh Lhe new Jorld whlch llmlLs Lhe laLLer Lo supply only Lo
Cul maklng Lhe enLry barrlers hlgh ln Lhe lndusLry

SWC1 ANALSIS
S18LnC1PS JLAknLSSLS CC81unl1? 1P8LA1S
O lnnovaLor has
Lhe 1
sL
mover
advanLage
O Polds Lhe
paLenL Llll 1980
hlgh enLry
barrlers
O ConLrols
suppllers new
Jorld
O roducL ls
effecLlve low
cosL and well
accepLed by
poLenLlal
cusLomers
O ScarclLy of
Managerlalresourc
es no full Llme
employee
O ScarclLy of
flnanclal resources
O ow on
manpower
salespersons or
Lechnologlcal
personnel
O no Lralnlng
lnfrasLrucLure as
yeL
O CapLurlng Lhe
vasL uS poulLry
markeL as Lhe
1
sL
mover
O ueveloplng as a
mulLl producL
flrm
O lg players
enLerlng Lhe
markeL ln
1980
O roblem of
replaclng
lenses may
render
producL
unpopular

IDLN1IIICA1ICN AND CkI1ICAL ANALSIS CI 1nL AL1LkNA1IVLS

1 NA1ICNAL VLkSUS kLGICNAL kCLLCU1 1o declde on Lhe opLlmum launchlng sLraLegy
of Lhe producL so as Lo derlve Lhe maxlmum beneflLs ouL of Lhe flrsL mover advanLage
whlle Lhe paLenL lasLs whlle keeplng ln mlnd Lhe producLlon consLralnLs of Lhe flrm
Clven LhaL Lhe Cul has a monopoly over Lhe markeL for Lhe flrsL 3 years lL ls necessary LhaL lL
has a sLrong fooLhold ln Lhe lndusLry by Lhe Llme Lhe ma[or players begln Lo arrlve ln Lhe 1980s
Powever glven Lhe managerlal and flnanclal consLralnLs of Lhe flrm lL ls unllkely LhaL Lhe flrm
would be able Lo handle a naLlonal level launch (requlremenLs 3892 salespersons and 1179
Lechnlcal represenLaLlves for around 471284 poulLry farms 1969 census)
Clven LhaL Lhe Cul would go for a reglonal level rollouL Lhe approprlaLe reglon appears Lo be
Callfornla norLh Carollna and Ceorgla LhaL house 23 of Lhe naLlon's chlckens for
maxlmum lmpacL of Lhe markeLlng sLraLegles lurLher Lhe producL has been flrsL LesLed ln
Callfornla glvlng lL an advanLage of famlllarlLy
no of farms wlLh flock slze above 10000ln Callfornla 114 + 87 201
no of chlckens 30412227
Assumlng 30 peneLraLlon amounL of sales for Lhe 1
sL
year 13206114 palrs
1he pro[ecLed cosLs for Lhe Callfornla offlce are as follows
$
1oLal annual cosLs

196000
Sales rep 40000
1echnlcal represenLaLlve 33000
AdverLlslng 100000
1rade falr expenses 100000
8esearch and developmenL 230000
lcense fees 23000
ln[ecLlon mold* 2 24000
CosL prlce of13206114 palrs 48639363
12S6S9S6S

2 1o dec|de on the opt|mum pr|ce for the product g|ven the va|ue der|ved from |t by the
pou|try farmers
1o break even Lhe Cul should yleld a comparable revenue of $ 123639363 from Lhe buyers AL
a pro[ecLed prlce of 008 per palr Lhe revenue yleld would be $ 121648912 resulLlng ln a loss
of abouL $ 4010633
An analysls of Lhe farmer's beneflLs ln Lerms of savlngs on feed wlLh Lhe lenses show Lhe
followlng
Savlngs on feed 13206114*363*136 /20000 $ 4329180636
Savlngs per blrd $ 2847
CosL per blrd $ 01136 + prlce of lens
Pence Lhe maxlmum prlce for Lhe lens can be 2847 01136$ 2833
1o break even Lhe Cul may Lherefore prlce Lhelr producL aL 1236393 / 13206114 $ 0083
Clven LhaL Lhe farmer derlves addlLlonal advanLages such as reducLlon ln kllllng due Lo
cannlballsm and reducLlon ln loss of producLlvlLy due Lo pecklng or debeaklng Lhe producL may
be prlced hlgher Lo flnance laLer cosLs of a naLlonwlde launch
CSI1ICN
1he producL should be prlced aL $ 0083 or more Lo break even and Lo flnance Lhe addlLlonal
cosLs of a naLlon wlde launch up Lo Lhe llmlL of $ 2833 per palr of lens