Issue Identification
The case study presents a brand transition challenge by the management of Manchester Products following a success acquisition of Paul Logan, Inc. furniture division (PLFD). Since PLFD had developed a stable brand in the US furniture market through the effective distribution, Manchester Products had to initiate a proper transition plan that would see it incorporate the strong brand of PLFD with its. Therefore, the main issue presented in the case brand transition challenge for the company. MH requires a proper brand transition strategy that will ensure that it generates higher sales revenue from the furniture sales. The other issue presented in the determination of the optimal time for the brand transition and the sequencing of transition for the brand name. Finally, the promotion and advertising expenses mix that is required to support the brand transition process for MH is also addressed in the study.
Factors to be considered
There are a number of factors to be considered for the brand transition by Manchester. These factors have an influence on the option that the company will adopt. The first factor that the company can adopt in addressing the issues is the overall market performance. The management needs to understand the market performance as well its position in the market. In addition, MH should consider PLFD market position in determining the brand transition strategy to be used. An overview of the market performance through the annual household and office furniture sales growth is considered. The market analysis influences the decision on the brand transition option since it affects the division performance and determines whether the selected strategy will help the company achieve its goals.
The second factor that needs to be considered is the distribution channel. Before its acquisition, PLFD had developed a stable distribution channel that had contributed to the large market dominance unlike MH whose distribution process was not stable. Determination of the transition strategy considers the distribution channel for both the companies’ such that a brand that has a stable. Less costly distribution channels are the best option since it does not affect the product pricing for the company’s products.
The level of competition in the industry should also be considered in coming up with a brand transition strategy for MH. It should not adopt a strategy that will not affect the competition for the company. PLFD experienced fierce competition from large established companies that imported there products from countries such as Mexico that had low labor costs. Since MH’s competitors were ready to challenge its new market position, a brand transition selected needed to ensure that there is no advance effect on the market dominance. Finally, the products and prices of the products were to be considered in developing the most appropriate brand transition strategy.
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