Kalpesh Bramhankar

PGX 103

Topic-In a Bind, Peak Stealing Technologies’ Product line Extension Dilemma

COMPANY PROFILE

• Name-Peak sealing technologies's(PST)

• Corporate Headquarter –Dallas,Texas

• CEO & President-Mr. Ethane Sloane

• Product Line-Carton sealing & Industrial tapes, Specialized adhesives, other

packaging tapes and Complementary packaging tapes

• Brand Mission-Continue development of cutting edge technology to provide

stronger, more secure, efficient sealing solution to our customers

• Competitive advantage-Technological leadership & Intensive R&D

Increasing with an average of 30%

PRODUCT DESCRIPTION

• Name-K2 https://www.youtube.com/watch?v=hr7yWWq5ZZs

• Application-Pressure sensitive carton sealing

• Manufacturing Technology-Pressure sensitive hot melt adhesive patented technology

with a premium polyester backing

• Characteristics-Tensile strength and tear resistance, durability, holding force and higher

heat and cold resistance than BOPP(bi-axially oriented polypropylene)

• Value proposition-Lower overall cost to the end user through superior performance

• Available in variety of widths, lengths, thickness, adhesives and backing material

COMPETITORS

• Inferior, economy grade and 25-30% cheaper – I-PackBOPP, Lacked K2 strength28.5 million sales in 2012

• Massachusetts based competitor-TensileEconomy, BOPP backed sealing tapeSales in 2012 $2.7 million sales

• Few distributors have already shifted to competitors product

INDUSTRY-Adhesive and sealant

•SEGMENTATION

Product Type-Natural Adhesives, Emulsion and dispersion chemistries, hot melt formulation and other reactive & solvent based adhesives

End User Type1. Packaging

2. Manufacturing & Assembly

3. Construction

4. Consumer/Other

• Pricing: All tape were sold through the distributors. The company employs a premium price strategy.

• Sales-Key Factors in company Success

Manpower-40

Scope-spend time with customers and solve problem

Contribution for the positioning of the brands

Hurdles due to expansion in packaging system• Before 22 people were spending 80% now only 35%

Being most knowledgeable and talented in the industry

Salary

DISTRIBUTORS• Highly selective 125 distributors with 55 being “Distinctive

Distributors”

• One Stop for packaging & Steering

• Order processing and fulfillment

• Joint Call with the sales team

• Hurdles due to expansion of PST

• Sales team less time devotion as compare to 2009

COMPETITIVE THREAT

• Market is open to new low price product

• Customers are extremely price sensitive

• Lack of brand loyality

• Taylor(K2 Product manager) analysis from lab results for I-Pack and Tensile products I-Packs products are very inferior Tensile products are halfway decent for uncomplicated, regular duty application Initial opinion is that Tensile’s Ecoslim might become a competitor to K2-Tape’s RD-48 and Ecoplus to

RDS-72

• Robinson(Nort-Eastern Regional sale manager ) believe that Tensile’s success to date came at the expense of I-Pack, not K2-Tape

SUGGESTIONS

• Some members of PST’s Executive committee suggested that the best way to defend against the threat is to add similar lower quality, less expensive product to the PST line-up

• President & CEO was not convinced and had asked Product manager of K2, Emma Taylor, to give formal suggestion on how to avoid the economy product threat.

Product manager recalled President and CEOs’ speech-

MAINTAIN PREMIUM PRODUCT

LINE OR FOLLOW DOWN-MARKET?

THANK YOU

THANK YOU