The Secret Power to the Growth of Asbury Images - Case Study Example

The secret power to growth of Asbury Images Big businesses ordinarily start from being small or from being home-based. Ashbury Images is no exception to this. It started as a small vocational business program but today, it is celebrating its 25th year in the business that attests to its growth. It is also one of the companies being voted upon as a favorite business area in Bay, San Francisco, California.(7x7SF). This is an annual competition held during the Month every year in Bay. What is the secret of its staying power and growth? I. Overview of Asbury Images - Businesss name, location or product description Ashbury Images started as a project of the New Doors Ventures in 1989 as a vocational job training program for “ youth-in risks” in the basement of a homeless drop-in center in the Haight-Ashbury district of San Francisco. Its operation was first focused on silkscreen printing of T-shirts. Soon enough, it quickly became the favorite silkscreen printing shops in the area. Today, its offices and business is located at 3,000 square foot facility at1661 Tennessee Street, #3G, San Francisco, CA 94107 Ashbury Images mission is “ to rebuild lives one shirt at a time by providing paid employment, job training, and supportive services to at-risk youth recovering from poverty, substance abuse and homelessness”. II. MARKETING STRATEGY The general markets of this business are business firms, schools, organizations, and households in the San Francisco area. According to the U.S. Census Bureau, San Francisco has a population of 825,863 as of 2013, and listed business firms of 105,030 (2007 est.). It also serves orders of customers in other areas of California. The total firms of California as of 2007 is 3,425,510 and a total population of 37,999,878 in 2012. This is already a big market to serve for the company. Purchasing behavior for the typical customer (frequency, involvement, etc) Typical customers of Ashbury Images are business customers. They are different from day-to-day customers. Business customers are more concerned with quality and look. They also purchase a wide variety of goods/services depending on their business needs. This group tends to establish long-lasting relations than the day-to-day customers. Business customers have a new kind of purchasing behavior, that is “mass customization”. This is the process of delivering goods that are modified to satisfy a customer need. Sometimes it is called “made to order”. Similar to this, Weintrub, Artlene (November 15, 2013) argues that mass customization is becoming the trend for retail products. For example, customers might generate their own design or artwork that has to be printed on the t-shirts, bags, mugs, or umbrellas, etc. Product Strategy The company maintains a website wherein customers could browse at the catalogs and product information. Customer could either request for a sales representative to come over or just order on line. On line service is available 24/7, while the whole transaction from ordering to shipment takes 15 days on the average. Company assures 100% satisfaction of customers on all orders. It also appeals to customers in terms of humanitarian assistance because proceeds of fund go to its social mission of employing and supporting at-risk youth. Description of product Asbury products are composed of wearable for all ages and promotional items. It has expanded its product choices from T-shirts, to pants and shorts; work wears, (office uniforms); accessories (towels, aprons, blankets, gloves); active wear (sports wears), infants and toddlers wear and promotional items such as baseball caps, bags, coffee mugs, ball-pens, wall clocks and key chains and other office accessories. Product Quality Strategy Suppliers of Asbury Images are manufacturers of branded names that are categorized as standard tees, specialty tees, and U.S.A. made teens. Specialty tees are made from special materials like organics and eco—friendly ones. Product/ Service Strategy Ashbury Images is providing customized silkscreen and embroidered apparel for large corporations, churches, nonprofits, universities and small business in California. It offers on-line ordering service or thru their authorized sales representatives. Its product/service strategies are thru testimonials of satisfied customers and on-line advertisements. Competitive positioning of product Competitions in silkscreen printing are many in San Francisco CA. All of them use internet presence. But notably, Ashbury is one of the top printers, aside from producing quality products that satisfied its customers. Satisfied customers keep coming back for repeat orders. Distribution Strategy Ashbury Images has developed an ordering system wherein customers can order thru on-line or thru its authorized representatives. Distribution is direct: from Ashbury to the customers. When everything is finished (payment, approval of digital proofs, and order is printed): product is delivered to the customer within 4 to 5 days thru courier service, UPS Freight, UPS Ground, 2nd Day and Next Day delivery. Basic Pricing strategy Companies may use different pricing schemes depending on its goals and objectives. It could either use skimming or penetration scheme of pricing. Skimming is charging a high price for a new product then gradually lowering its price to attract thriftier customers. While penetration is pricing the product lower relative to competition to attract buyers and is more appropriate for small business. (Richards, Leigh, 2014). Ashbury uses penetration pricing since it is a non-profit business. Promotion Strategy – Promotion strategy is used by companies to let customers know of its products and services. Usually, it is done through advertising, personal selling, sales promo devices, and publicity. Ashbury Images communicates to its customers thru advertising, through internet and personal selling thru sales representatives. It maintains strategic promotional alliances with humanitarian organizations that support same views of helping. Sales promotional devices of Ashbury Image are through e-mails, posters, and joining competition like the favorite business area in Bay Area. Competitions of this sort increases awareness. Technological issues Like in other businesses, printing also uses modern technology. Up-grading of equipment is needed to respond to customers immediate needs. Asbury has just added its new "grande auto" 14-color press that brings total production capacity to over a million prints a year on a single shift. Financials Assumptions on its financials are stated below. (company data is not available) Sales is based on the capacity of its 14-color press machine that produces over a million prints in a year, and from a conservative estimate of target market. Price is based on the prevailing price in the internet. An estimate of 50% COGS is the standard costing. SALES VOLUME COST TOTAL 1,000,0000 (prodn capacity) $23/SHIRT/ $23,3000,000.00 LESS: marketing/service provisions (cost of goods sold) 50% of revenue 11,500,000.00 Estimated gross income 11,500,000.00 The estimated sales revenue is $23,300,000. After deducting the 50% of cost of goods sold, $11,500,000 is left for overhead expenses. Conclusion Clearly, the company needs a marketing strategy to attract the large business market of San Francisco. Although this is a non-profit organization, it has to protect the interests of its stakeholders, the New Doors Ventures whose mission to help the youth-at-risks. It still needs to monitor its market share, brand leadership and profitability in order to carry on with its mission. The company is one of the social enterprises that operate business in order to generate revenues to fulfill its mission. To do this, company needs a marketing strategy. Marketing strategy is a long term plan done for the purpose of achieving objectives. Supposing that my recommendation is for Ashbury to become a market leader by satisfying customers, my strategic plan is to conduct a marketing research, then come up with a marketing mix that will please customers. Marketing mix includes the right product, right price, right place and the right promotion. My marketing plan for Ashbury is the use of social networking and an aggressive community marketing. Company should not wait for customers to come; instead sales representatives go to them and find out their needs or suggest ideas. Community marketing caters to the needs of existing customers. This encourages loyalty, product satisfaction and promotes word of mouth in the community In social networking, aside from its own website, company can make use of Facebook and Twitter to describe its mission, products, promotions, and sales. It can also be an effective venue for testimonials or the word-of-mouth referrals. You Tube videos can be useful for demonstrating how the company helps the youth-at risks so that people can be convinced on the sincerity of the company. Works cited Ashbury Images. http://www.ashburyimages.org/contact.html Leigh, Richard (2014). Different types of Pricing Strategy. Small Business at Chron. Retrieved 15 April 2014 U.S. Bureau of Census (2014) San Francisco, Quick Facts. http://quickfacts.census.gov/qfd/states/47000.htm Weintrub, Arlene (Nov, 15, 2013) Is mass customization the future of retail? Entrepreneur http://www.entrepreneur.com/article/229869 Read More