MKTG 310 Case Write Up
Matisse Company
Timothy Matisse came to the 4C’s with questions on what he should do with respect to the future of his business. Mr. Matisse is a middleman; the wholesaler for mill companies which produces lumber for local lumberyards, which are his customers. He works with 5 large lumber mills and until recently he was the only one in his area that sold on behalf of these mills. He is not limited by train carloads per month in what he has to buy from the mills. Matisse finds a buyer for the lumber and then directs the train car already en route to the customer.
For 20 years Matisse has worked for the lumberyard, and he knows his business well. He is also on good terms with the local lumberyards. Each month he makes sure to visit each client, and ensures they are happy with his business. However, he mainly does business thru emails or by phone. His rates are 4 to 6% higher than his competitors, which keeps him very competitive.
Matisse’s problems stem from competition by large home improvement chains that provide a larger quantity, lower prices, one stop shopping and consistent inventory. These large chains are even putting his local lumberyards out of business, thus reducing his current income and future income potential unless he gains new clients.
Now Matisse faces another issue. A competing wholesaler/middleman has moved into his territory. The competitor represents different lumber mills, and constantly undersells Matisse. This competitor is continually cutting into Matisse's market share. Even Matisse's most loyal customers are buying from his competitor based on pressure to keep prices low and thus compete with ...