JOSEPH
R. STEVENS and
CHARLES H. SLATER
J. T. Baker Co., Phillipsburg, N. J.
Switching to
CY
haboratory Market for Ion Exchange Resins m
1
HIS case history centers around a problem that concerns many chemical companies-what to do about small package requirements for products normally sold in bulk. A specific example is the recent addition to the J. T. Baker laboratory chemical line of a group of products manufactured by another company. This sounds simple and straightforward, but several problems arose in switching from centralized sales to a distributor-type organization. Early in 1957, the company recognized that ion exchange resins were finding
increased laboratory application, but had no plans to develop and manufacture these materials. Therefore Baker decided to approach Dow Chemical Co. regarding distribution of the resins. When Dow was approached, they were immediately interested. Many orders from laboratories were so small as to be unprofitable when handled by their centralized system. Equally important, they were unable to provide resins quickly to all markets by direct shipment and were thus concerned about good service to the laboratories.
Problem
Because of the obvious advantages to both companies, an agreement was reached for Baker to undertake the entire marketing program for laboratory quantities of Dowex ion exchange resins in the United States and Canada. Work began on the mechanics for getting these products to the consumer effectively on a basis that would motivate the laboratory supply house to perform its function. In formulating plans for marketing these resins, the eight specific problems described below were peculiar to this projected marketing program.
Solution
Product Line and Packaging The entire line was re-evaluated and reduced to 34 standard There were over 70 types or mesh sizes of the resins, with the products, a workable number. About half of these were dollar volume of some too small to attempt widespread stocking. supplied in both 1- and 5-pound sizes; the other half in only the The resins had been packaged in a variety of sizes to provide 1-pound size. each consumer with his exact needs. Product ldentiflcation Chemists who had been carrying on experimental work with The decision to use the Baker label (with Dow nomenclacertain resins would want to be sure of obtaining the same ture) was based on the fact that Dowex terminology had resins again. become part of the technical literature and had considerable acceptance. As for all Baker Analyzed reagents, each resin is labeled with an actual lot analysis. Avoiding Conflicts in Marketing Areas The distinction between bulk sales and laboratory quantities had to be clear cut.
Any order for 50 pounds or more of one resin is handled by Dow; an order for less than 50 pounds is handled by Baker.
Economics of Distribution Inventories Only a complete stock enables a distributor to do a thorough The answer was a minimum stock requirement-the amount job in his marketing area. Yet, the volume of resin business of each resin a distributor would be required to carry in order to would not be large enough to justify complete stocks of resins service his marketing area. Only oneor two distributors in each area could justify carrying the complete stock requirements. for all 85 domestic distributors. Distribution Costs Prices were increased to cover additional distribution costs. Dow’s nominal mark-up for laboratory quantities covered packaging costs but did not provide for promoting resins in the laboratory field or expenses of the laboratory supply house. Location of Distributors’ Markets Ion exchange resins were a new product line for most of the Dow provided names of all customers for the past year andIthe distributors, so there was no sales pattern to locate prospects. particular resin each purchased. Distributor Relations Over the years Dow has sold resins directly to quite a few Baker distributors-usually small quantities at a time to meet the requirements of some specific customer.
Dow informed these distributors that in the future Baker would handle distribution of the resins in laboratory quantities.
Timing of Referrals Baker did not want referrals until the distributor could render prompt service on the full line of resins.
Each week Dow was sent a list of distributors who had received full stock orders. They in turn notified their branch offices in the appropriate marketing areas.
VOL. 52, NO. 1
JANUARY 1960
19
