DECISION MAKING

A Professional Approach to Marketing Decision Making



A Professional Approach to Marketing Decision Making

Cima Mountaineering Inc.

Business is making profits, and to make profits, a business must take a certain amount of risk. Hopefully, in the long run, that risk is minimized, and profits that once seemed unreachable are the entire sudden true. This mere set of statements really sums up who I agree with. Margaret's idea is both daring and risky, taking into account the fact of established players in the market, and the amount of head start they already have on Cima. While her idea is quite risky when you look at it (no equipment or experience in making the kind of boots to sell) and the time to market being probably 6-12 months away assuming fast turn around, and you have yourself some major risk.

Problem

Cima Mountaineering is a mature company that has undergone several major changes in the past 20+ years. As a specialty producer of hiking and mountaineering boots, this family owned business is built on craftsmanship and field-tested durability. The Cima product line has traditionally been sold in the Western region and sold directly at sporting stores that service the outdoorsman. However, the competitive environment over the past few years has steadily changed, with more foreign competition and lower priced lines of hiking and casual boots. Anthony Simon, Executive Vice President, and his sister, Margaret, find themselves once again in the position of redefinition. The problem to be solved is whether to market a new line of boots for the less experienced, weekend hiker, expand the current product lines for mountaineers and hikers.

Company History

Cima Mountaineering was founded as a Western boots maker by the name of the Hoback Company, based out of Jackson, Wyoming. In the 1960s, and into the 70s, as the demand for Western boots began to decline, the company's profit share steadily declined until Anthony and Margaret took control of the company in 1975 and showed a profit on 1.5 million in sales of $45,000. It was after this stabilizing trend that Anthony Simon drew on his college experience in mountaineering and suggested the Hoback Company develop a line of hiking/mountaineering boots. After 12 months of extensive research of the market the product was tested and received high marks among instructors of the mountaineering school.

The hiking/mountaineering product line consists of 2 styles of boot. One is for the more serious outdoorsman, designed for all-weather climbing. The second is for men and women who are advanced hikers. As the popularity of outdoor sports and recreation boomed through the 80s, so did the demand for Hoback Boots' hiking and climbing product line. With a new sales peak at 3.5 million in 1986, the company expanded distribution with the aid of independent sales representatives to handle sales and service, and this allowed the expansion into neighboring states through sale at retailers that's specialize in hiking/mountaineering equipment. It was at this time that Hoback boots changed its name to Cima Mountaineering, ...