In less then 20 years, Cumberland Metal Industries has grown from $250,000 thousand dollars in sales to $18.5 million dollars in sales. It started as being a company that sells highly technical products, as the finished product, then it transitioned to selling products that were used as work in progress materials. The company's big break came from the introduction of ERG valves in the U.S. automobile industry. Cumberland made their trademarked "Slip-Seal" that fixed the problems associated with ERG, with that they gained a huge market share. This lead to the company growing very rapidly in the mid-1970s. Now we are evaluating the merits of the curled metal cushions pads. It is a new technology that Cumberland Metal Industries want handle, which is something they were looking to do in the first place. Even though Cumberland has 80% of the market on their own products, they were planning to diversify. That is because they don't want to be reliant on the industrial and product. So curled metal cushion pads in an exciting industry application that must be carefully considered to the benefit to Cumberland Metal Industries.
Industry Overview.
The following is a educated estimate of the industry because (as mentioned in the case) there are no statistics for cushion pads in the U.S. market. According to a 1977 report by "Construction Engineering" magazine, that 13,000 pile drivers were owned by companies directly involved in pile driving. Also, anywhere from 6500 to 13,000 we leased. About 19,500 to 26000 hammers were in operation during 25 weeks in the year and while being used 30 hours per week. The actual driving figure, including times too change pads and other technical replacements/repair, was 20 feet per hour which worked out to be 290 million to 390 million piles driven annually. Although not direct purchasers, there are six influences identified that deal in the purchasing decisions for people who are going to buy.
