Cima Mountaineering-final

8/7/2019 Cima Mountaineering-final

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OutlineOutline

Background

SWOT analysis

Current situation Key issues

Recommendations

Alternatives


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BackgroundBackground

Hoback Boot Company, founded inJackson, Wyoming

Began as a Western-style boot company

Inherited from parents (president- Margret& VP- Anthony)

Company was refocused to increase

revenues 1981 Hoback was renamed to Cima

Mountaineering


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SWOTSWOT

STRENGTHS Test hiking boots on trails

Discuss marketing strategies to increase profitsand increase sales

Sales & Profits have grown steadily

Anthony & Margaret (owners) grew up learningthe boot business

Quality emphasized throughout product line

Each line has different styles & features to covermany of the important uses in the market


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SWOTSWOT

WEAKNESSES

Growth has slowed down as a result from

foreign competition & a changing market Market wants more casual, stylish boot for

weekend hikers

Not much modification to the current boots Decided not to use mail order catalog

companies


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SWOTSWOT

OPPORTUNITIES

Market wants more casual, stylish hiking

boot for a variety of uses Ideas to extend the line & expand

distribution

Make boots at lower prices Light weight hiking boot for less

experienced hikers


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SWOTSWOT

THREATS Risk in new line of boots

New boots = new set of marketing,

competitive issues, and financing a newline

Asolo, Hi-Tec, Salomon, Raichle, Reebok,Nike, Vasque, and Merrell

Rocky Mountain Sports & Great WesternOutfitters dropped Cima and picked uptheir competitors (more to come?!)


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Current SituationCurrent Situation

Revenues are increasing but at a slowing rate

Cima is looking to expand but they cant decide whichalternative to choose

Losing business due to high prices Competitors are becoming increasingly popular with a

less expensive weekender style of boot

Cima currently only focuses on more expensive boots for

a medium to advanced level of hiker and climber Cima only sells using personal selling to specialty

retailers while their competitors sell through mail ordercompanies and chain sporting goods stores


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ProblemsProblems

Distribution

Price

Competitors Foreign

Domestic

Promotion Slow to moderate market growth


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ProblemsProblems

Distribution Currently, Cima boots are only distributed in Western

Canada and the Western United States

Only sell in 10 states in the US

Cima Mountaineering only sells their boots to retailersthat specialize in mountaineering, backpacking, andhiking equipment

Do not use catalogs Do not use sporting goods chains

Do not use internet


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ProblemsProblems

Competitors Foreign

Foreign companies exporting their boots aggressively intothe United States

Asolo, Hi-Tec, Salomon, Raichle marketed on performanceand reputation, usually to the mountaineering serious hikerand weekender segments of the market

Domestic Vasque and Merrell market boots that compete with Cima,

but are offering products for segments of the market whereprospects for growth are better

Reebok and Nike new entry to boot market-- appearance anddurability of hiking boot with the lightness and fit of athleticshoes-- expanding into markets that demand lower levels ofperformance


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ProblemsProblems

Price

Current prices are too high to reach some ofthe market

Losing retailers due to high prices

Great Western Outfitters replaced Cima withMerrell due to customers asking for lower-pricedboots


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ProblemsProblems

Promotion Cima needs to expand their promotion techniques

Personal selling

Print advertising

Trade shows

Point of sale displays

Only have 10 sales reps All independent and sell complementary equipment

Print advertising is only placed in backpackingmagazines Summit,Outside, Backpacker


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ProblemsProblems

Slow to moderate market growth

Mountaineers only make up 5% of the marketshare and are seen as having slow growth

Serious hikers make up 17% of the marketshare and are seen as having moderategrowth

They are in no high growth markets and onlyreach 22% of the boot market


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Key IssueKey Issue

How to expand the company in order toincrease growth and keep up withcompetitors

Management is torn on which expansionapproach to take

Expand existing Line

Develop new line


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RecommendationsRecommendations

Introduce a less expensive, more versatile CimaWeekender boot

Lightweight, comfortable, durable, versatile

Young to middle aged men and women

Recreational hikers, enjoy outdoors and spending time withfriends and family

Price range ($80-$100)

Benefits

Appeal to a new target market High potential for growth

Low prices while maintaining quality

Expand distribution


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RecommendationsRecommendations

Increase product distribution of all lines

Expand throughout the U.S.

Expand to chain sporting goods stores Dicks Sporting Goods REI

Gander Mountain

Distribute through mail order catalogs

Distribute through internet Allows customers to order on company website

Allow customers to order through retailer websites


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AlternativesAlternatives

We Chose not to expand existing bootlines

Smaller target market

Mountaineering and serious hikers only make up 22% of the bootmarket

Weekender boot market makes up 25% of the boot market

Less growth potential Mountaineering is a low growth market

Serious hiker is a moderate growth market

Weekender is a high growth market

Already have multiples styles in those brands Have three mountaineering styles

Have 5 serious hiker styles

If weekender brand proves successful, they can always

expand their existing boot lines in the future


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Questions?Questions?

Cima Mountaineering-final

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