Mueller-Lehmkuhl GmbH Case Analysis

By Balaji (FT12206) Debdyuti (FT12208) Phani Kiran (FT1281)

1/28/2012

Question :

Analyze the competitive environment faced by ML. Why does

the new entry by the Japanese manufacturing threaten Mueller s marketing strategy?

Japanese Companies were pricing 20% less than that of ML (eg: Hiroto Industries) Hiroto fasteners came with much more flexibility

and were compatible even with ML s attaching machines whereas ML offered fasteners which were compatible to assemble only with their attaching machines These qualities gave the Japanese Companies an edge over ML in terms of preference by the dealers and customer choice.

Question : How should Mueller respond to the Japanese threat?

ML should avoid
bundling the price of attaching machines with their fasteners price

This should eventually reduce the price of the fastener The attaching machines should be upgraded by ML by making it compatible with the
fasteners manufactured by various manufacturers in the market.
2

Question 3:
Description Direct Labour Cost (DLC) Correct DLC DLS Correction Factor Old Cost

Exhibit 5 shows the reported product cost. What is your

best estimate of the product cost?

S-Spring 1.32 13.69 42.46 28.77 Ring 1.43 14.83 38.59 23.76 Prong (B) 0.14 1.45 9.42 7.97 Prong (S) 0.27 2.8 13.63 10.83 Tack 0.66 6.84 29.17 22.33

16.7/1.610=10.37

New Cost (Old Cost - Corrected DLC)

1/28/2012