Jones – Blair Company Case Report
Industry, market, and buyer behavior
The Jones-Blair Paint Company competes in an industry characterized by the mass production of low-margin homogenous paint products. The concentration of the industry over the last 25 years has created large manufacturing conglomerates that utilize economies of scale to offset rising costs. Smaller companies like Jones-Blair compete on quality differentiation by producing high quality, regionally specific paint products. The market consists of three primary segments, do-it-yourself painters, professional painters, and contract painters. The do-it-yourself painters desire a “covering” paint at a low price and view quality as an order qualifier, not an order winner. Contract painters are even more price sensitive, viewing paint as a commodity, seeking the lowest possible price for large scale projects. Professional painters rely on the quality of the paint they use to augment their reputation, so quality is of critical importance in the paint products they purchase.
The Organization
Jones-Blair produces high quality paint that is designed specifically for the southern climate. They compete successfully against larger manufactures by offering a high priced, high quality product that fulfills the needs of regional professional painters. The Jones-Blair offering adds significant value to the quality of the professional painter’s work and the overall quality of the professional painter’s reputation. The company has experienced ten years of constant sales growth, but within the last five years the total volume of paint sold has remained constant. Although the company has raised price to maintain contribution ma ...