Raise Price to Improve Revenues and Margins
CHOICE 1 OBJECTIVE: RAISE PRICE, RECOVER THE INCREASED COST OF CURRENT PERFORMANCE
CHOICE 2 ISOLATE SEGMENTS: DUE TO A UNIQUE FUNCTION
CHOICE 3 COMPONENT: CHANGE THE BENEFIT PACKAGE
| No. | SIC | Year | Notes |
| 1 | 3621 | 1997 | Baldor primarily serves industrial customers and sells very little into the consumer area (e.g. appliances) where the customers are large and can impose extreme pricing pressures. Baldor supplies more than 8,000 companies, the largest of which accounts for only about 3% of revenues. No one client has considerable pricing leverage on the Company. And sometimes Baldor is even able to get pricing up as it did in 1996 when pricing was up by 1%. This broad customer base would be hard for a competitor to replicate. Baldor finds itself in a favorable position with a fragmented customer base and competitive forces have not yet made it necessary for it to relocate its manufacturing facilities to low cost labor markets overseas. |
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