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    Soren Chemicals

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    Rizki Setyo Pratomo
    Soren Chemical's new swimming pool clarifier product, Coracle, is not meeting its first year sales goal of $1.5 million despite being effective at removing contaminants. An analysis found issues with the product's launch timing, lack of promotion to end users, and higher price compared to competitors. The report recommends restructuring pricing, promoting directly to consumers, educating them on Coracle's benefits, and negotiating better margins for distributors to increase retail sales and meet goals.

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    Soren Chemicals

    Uploaded by

    Rizki Setyo Pratomo
    3K views17 pages
    Soren Chemical's new swimming pool clarifier product, Coracle, is not meeting its first year sales goal of $1.5 million despite being effective at removing contaminants. An analysis found issues with the product's launch timing, lack of promotion to end users, and higher price compared to competitors. The report recommends restructuring pricing, promoting directly to consumers, educating them on Coracle's benefits, and negotiating better margins for distributors to increase retail sales and meet goals.

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    Soren Chemical's new swimming pool clarifier product, Coracle, is not meeting its first year sales goal of $1.5 million despite being effective at removing contaminants. An analysis found issues with the product's launch timing, lack of promotion to end users, and higher price compared to competitors. The report recommends restructuring pricing, promoting directly to consumers, educating them on Coracle's benefits, and negotiating better margins for distributors to increase retail sales and meet goals.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    3K views17 pages

    Soren Chemicals

    Uploaded by

    Rizki Setyo Pratomo
    Soren Chemical's new swimming pool clarifier product, Coracle, is not meeting its first year sales goal of $1.5 million despite being effective at removing contaminants. An analysis found issues with the product's launch timing, lack of promotion to end users, and higher price compared to competitors. The report recommends restructuring pricing, promoting directly to consumers, educating them on Coracle's benefits, and negotiating better margins for distributors to increase retail sales and meet goals.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    of 17

    Soren Chemical Why is the New Swimming Pool Product Sinking

    Prepared by :

    Iwan Kurniawan Anita Hutahayan Yan Anantakusumo Rizki Setyo P

    Company Background
    Founded in 1942 by Timothy Soren

    Sell :
    Industrial-strength cleaning solutions Industrial chemical for lubricants and

    fuels Chemical solution for treating drinking water and wastewater. 350 products line 2006 revenue is $450 million.

    Product Background
    Kailan MW Flocculants. (Clarifier)

    Flocculants can be thought as chemical nets

    that works in water to filters particles as small as 0.5 microns. Effective in dealing with: Oil (deodorant, hair spray, lotion cause odoor and Cloudiness) Combat organic debris (algae, dangerous pathogens such as E.Coli and Cryptosporidium)

    Product Specifications
    Soren sold Kailan MW and Coracle are

    flocculants chemicals that suspended particles in liquids to angglomreate into larger, heavier particles called flocs Kailand MW found in 2002 that effective in dealing with oils that come from deodorant, hair spray and lotions hiwch cause odors na dcloudiness in water (safety hazard) One gallon of Kailan MW could effectively threat approximately 500,000 gallon of water Soren estimated for 2007 US Market for specialty commercial use clarifiers to be approx USD 30 Millions

    PRICING

    PRICING
    Pricing - Coracle & It's competitors
    60 50 40 30 20 10 0 Coracle
    Cost per container, retail price

    Purity

    HydroPill

    ClearBlu
    Annual cost, retail price

    Cost per treatment, retail price

    PRICING
    Pricing Simulations Retail Price Retailer - gross margin Retailer - gross profit Distributor Price Distributor - gross margin Distributor - gross profit Soren Chemical Price Soren Chemical gross margin Soren Chemical gross profit If Distributor Margin 30% 20% 25% 25 22 23 15% 15% 15% 3.75 3.28 3.50 21.25 30% 6.375 14.88 35% 5.21 18.6 20% 3.72 14.88 35% 5.21 19.84 25% 4.96 14.88 35% 5.21

    Problem Identifications
    Coracle as one of clarifiers product that produced by

    Soren Chemical which targetiing residential pools that have smaller size againts commercial pools The Targeted residential pools of coracle have a lower volume of water, lower volume of swimmers, and less intense maintenance program Estimated thered are 9 millions residential pools in US Currently corracle has 3 leading competitors for residential pools clairifiers (each of competitor has a 15% to 20% share: Keystone Chemical Kymera Jacson Laboratories

    Problem Identifications
    The first year goal for coracle is USD

    1,5 Millions The frequency of usage of residential pools and residential pool chemicals will be increased from May (the average months of pools usage are 5 months), normally people will swim in summer time (May-September)

    The Analysis

    The Analysis
    Consumers, wholesales distributors, pool

    services professionals, pools specialty retailers, mass retailers neet to take time to know the Coracle brand The Stock in the consumers sides, pools services professionals sides, pools speciality retailers sides and mass retailers will also impact the sales of coracle. If consumers decide not to use the pools until next may, they may not maintain the pools, and no need to purchase the clarifiers like Coracle Consumer market of residential pools emphasized more on aesthetics and

    The Analysis
    30% of the renspondents recalled receiving the

    corracle materials that soren Chemical had sent in response to their inquiries. Furthermore, 70% of the renpondents stated that their distributors had not offered Coracle or it seems Coracles sales team did not deliver sufficient efforts to introduce this kind product Ther is unclear gap between Kailan MW and Coracle even though kailan MW targets at the segment of commerical pool and water parks, meanwhile Coracle targets at residential segment. At least 2 formulators who dilute Kailan KW with a private label and sell to distributors for consumer market and this will compete with coracle The Retail price for Sore per container of 0,5 Gallons has been settled as USD 25, and this is based on a

    Coracle SWOT
    Strength Has Kailan MW advantage as product. Reducing pools owner annual chemical cost by 20% to 30% Weakness New product/Entry. Higher unit price than competitors. Distributors does not attracted enough to promote Coracle. Coracle only promotes to distributor, retailer, and profesional. End users do not realize the value of Coracle relative to other clarifier.(from price perspective and advantage)

    Coracle SWOT (Contd)


    Opportunity
    Potential Great Demand 70% respondents had not receive Coracle material yet. 70% respondents states that coracle had not been offered by distributor.

    Threat
    Need additional $600,000 as advertising

    budget. Different purchasing behavior between professional (from wholesale distributor) and consumers. ( buy from retailers, aesthetics

    The Alternatives
    Soren had launched Coracle in insuitable

    month because September is the last busy month for swimming season, it can not refered as good season for sales. Accept Morrits marketing budget proposal, to promote to end user not only to distributor chain.
    Consumer education. Can be add some physical evidence and free

    testing.
    Review the pricing and package strategy

    because it has sensitive to end consumer.


    Review the agreement between Soren and

    distributor about differentiated Chemical Agent,

    Action Plan
    Priority the restructuring of pricing product

    strategy.
    Renegotiating with wholesale distributor about

    gross margin about 20% decreasing retail price. 20% $22 25% $23
    Promote aggresively to end consumer. Educate consumer about the advantage of products. Re-launch the product to the market on summer. (swimming seasons). Soren has to try to bypass the wholesale

    distributors, selling limited range to wall mart and homedepot.

    Conclutions and Suggestions


    Opportunity exists in terms of margins for the

    distributers and retailers Deliver clear message to the end users, and make then aware about the facts the product offering Define clear margins for the distributers who may sell the diluted product

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