Start Up Watch Producer And Distribution Company example essay topic

Austin Watches is a start-up watch producer and distribution company. Its strategy is to serve the upscale niche markets of the watch industry. It will capitalize on the German engineering and manufacturing used to build the watches. There are many untapped potential markets within this industry that desire high-quality, stylish goods, but do not think they can afford them or do not know where to purchase them.

It is the firm's intention to build and export its products to the United States and to make Austin Watches the number one selling European watch in the Western U.S. To do this the company's long-term goals are to achieve a 20% market share in the U. S, build brand image and brand equity through marketing, achieve a sustainable 55% profit margin, and eventually produce luxury watches in addition to the initial, moderately-priced line. Mission Austin Watches is a watch company that produces wristwatches for sale in the United States - initially in California. The company will build its image, as a quality watch first, and then will begin selling higher profit, luxury watches. Austin Watches sells quality watches and provides excellent customer service for customers seeking a reliable watch.

In the future Austin Watches intends to enter the luxury watch market The Company and Ownership Austin Watches is a privately owned international corporation. Production takes place in Germany and sales and marketing are focused in California, United States, for the short-term future. Ownership is divided among three principal individuals who are putting up the initial investment. These include: Franz Austin- head of production department, Henry Winston - head of American division and sales and marketing division, and Walter Johns - vice president of American division.

1. Franz Austin: 55% (Germany), 2. Henry Winston: 30% (U.S. ), 3. Walter Johns: 15% (U.S. ). Company Locations and Facilities The German factory is located in Frankfurt, Germany at 210 Automotive Drive. The factory is 1,000 square meters and should be large enough for the first three years of the company's growth.

The watches will be shipped to and distributed from Henry Winston's house at 343 Palm Avenue, in Los Angeles, California. The watches will be initially sold in upscale watch stores in Los Angeles and San Francisco. The watches will be shipped to and distributed from Henry Winston house at 343 Palm Avenue in Los Angeles, California. Sales Strategy Austin's sales force will consist of Henry Winston and two freelancing sales representatives. Order processing will be achieved through communication between Henry Winston in the U.S. and Franz Austin in Germany. The Products Austin Watches are elegant analog watches with sporting characteristics, able to be used to depths of 100 meters under water.

1. The Sport watch will be made of a durable steel and hard rubber combination that will provide both style and durability. 2. The night watch will be all black including the face with minimal white writing for the numbers on the face and will feature white hands as well. Pricing The price per watch is expected to be around $100-$200. The pricing strategy will be to initially undercut our main competitors by 10%, using a market penetration strategy.

Then, pricing will be adjusted to be directly competitive with the other major competitors. The Market Entry into the high-end watch industry comes as a pro pious time. Over the past two years, the purchase of mid-level and high-level European watches has increased by 50 percent in the U.S. and this trend is expected to continue. One of the most important recent trends is that potential watch buyers are willing to spend higher amounts on watches because of the enhanced image appeal.

Therefore, a company that can build a substantial brand image in this industry gains a significant competitive advantage. It is the aim of Austin to capitalize on its high quality and reasonable price while pursuing the innovative styles necessary for brand building. Financial Considerations The Company's start up costs will be $226,000. Owners equity will be provide $171,000, $30,000 will consist of short-term borrowing, and the rest will be long-term loans. The majority of the start-up costs will consist of rent, research and development, initial inventory, and a strong cash account. Objectives To make Austin Watches the number one selling European watch.

To eventually produce luxury watches in addition to the moderately priced line. To achieve a 55% profit margin. To achieve a 20% market shares in the U.S. Marketing Strategy The marketing strategy will focus on two segments: The company will benchmark the objectives for promotion, outlet selling, and personal selling. The marketing budget will be $36,000 per year.