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    Ortho 500 Sales Strategy

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    Aparna Singh
    FormPrint is launching the Ortho 500 3D printing system for custom orthopedics. It will cost $18,000 and target the US outpatient market. While the Ortho 500 has strengths in ease of use and performance, its functionality was not as important in surveys. If it fails to gain market share by 2018, layoffs could occur in FormPrint's medical division. Management must decide whether to use independent sales reps or FormPrint's own reps to market Ortho 500. Blended direct and independent sales may yield better results given FormPrint's budget and experience managing independents. Independent reps have less fixed costs but less control, while FormPrint reps could struggle to recoup costs in the product's 90 day

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    Ortho 500 Sales Strategy

    Uploaded by

    Aparna Singh
    139 views4 pages
    FormPrint is launching the Ortho 500 3D printing system for custom orthopedics. It will cost $18,000 and target the US outpatient market. While the Ortho 500 has strengths in ease of use and performance, its functionality was not as important in surveys. If it fails to gain market share by 2018, layoffs could occur in FormPrint's medical division. Management must decide whether to use independent sales reps or FormPrint's own reps to market Ortho 500. Blended direct and independent sales may yield better results given FormPrint's budget and experience managing independents. Independent reps have less fixed costs but less control, while FormPrint reps could struggle to recoup costs in the product's 90 day

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    FormPrint is launching the Ortho 500 3D printing system for custom orthopedics. It will cost $18,000 and target the US outpatient market. While the Ortho 500 has strengths in ease of use and performance, its functionality was not as important in surveys. If it fails to gain market share by 2018, layoffs could occur in FormPrint's medical division. Management must decide whether to use independent sales reps or FormPrint's own reps to market Ortho 500. Blended direct and independent sales may yield better results given FormPrint's budget and experience managing independents. Independent reps have less fixed costs but less control, while FormPrint reps could struggle to recoup costs in the product's 90 day

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    139 views4 pages

    Ortho 500 Sales Strategy

    Uploaded by

    Aparna Singh
    FormPrint is launching the Ortho 500 3D printing system for custom orthopedics. It will cost $18,000 and target the US outpatient market. While the Ortho 500 has strengths in ease of use and performance, its functionality was not as important in surveys. If it fails to gain market share by 2018, layoffs could occur in FormPrint's medical division. Management must decide whether to use independent sales reps or FormPrint's own reps to market Ortho 500. Blended direct and independent sales may yield better results given FormPrint's budget and experience managing independents. Independent reps have less fixed costs but less control, while FormPrint reps could struggle to recoup costs in the product's 90 day

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    At a glance
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    FormPrint is launching a new 3D printing system called Ortho500 that can print custom orthopedic splints, braces, and casts. Its target market is outpatient departments across the US.

    FormPrint's new product is called Ortho500, a 3D printing system that can print custom orthopedic splints, braces, and casts. Its target market is outpatient departments across the US, which had a market share of 1.4 million US orthopedic patients.

    FormPrint may face challenges in establishing a leading market share for orthopedic bracing by 2018. Its medical product division could also face layoffs if Ortho500 is not successful. Management must decide how to market the new product effectively.

    Ortho 500 Sales strategy

    FormPrint
    FormPrint was established in 1998, and designed 3 dimensional
    prototypes through patent protected technology
    technology FormPrint
    FormPrint mainly
    !ocused on health"care application #y end o! $013, FormPrint had
    sales o! %&$9 'illion

    FormPrint
    FormPrint is launching ortho500,
    ort ho500, a new 3( printing system which
    could print custom e)os*eleton
    e)os*eleton orthopedic splints, braces and
    cast according to the body o! each patient +he planned price !or
    this Ortho 500 product is %8,000 and the target mar*et is
    outpatient department across -S, which had a mar*et share o!
    1.. million -S(

    Ortho 500 Strengths   ease o! use, o/erall per!ormance

    ea*ness  Functionality

    #ut as per the sur/ey !or 3( printing the !unctionality o! the


    system was not that important

    ! ortho500 !ailed to establish a leading mar*et share in


    e)os*eletal
    e)os*eletal bracing in $01&, Formprint2s
    Formprint2s medical product di/ision
    could !ace layos

    'anagement (ilemma
    4ow to mar*et Formprint2s new orthopedic 3( printing system
    Should they enter the mar*et through ndependent sales
    representati/e or should they go with Formprint2s sales
    representati/e

    hich will reap them a ma)imum bene6t


    Solution
    Since FormPrint is entering into a new mar*et and on tight
    budget n this situation, blended o! S7"(irect sales approach
    would result in more !a/orable results

    ach Formprint2s sales representati/e cost about % &00,000, this


    cost to company is not concerned or not with respect to selling
    ortho 500

    ! we allocate an addition o! % .5,000 to % &00,000, and


    considering the le/el o! e)pertise o! FormPrint sales
    representati/e o/er period o! 1$ months i! the Sales
    representati/e can achie/e target o! selling  Ortho 500 printing
    system Since the e)pected sales cycle is 0 days

    1 ost to Sales Person &00,000 -S(


    $ Ortho 500 Sales target allocation .5,000 -S(
    3 Sales cycle !or Ortho 500 0 days
    & )pected Sales o! 'achine in a 
    year
    5  +otal re/enue generation !rom &08,000 -S(
    Ortho 500:per sales person;
      +a) $3< &08,000"
    938&=398,1 -S(

    From the abo/e table, at 8,000 -S( pricing o! Ortho 500 the
    sales representati/e cannot achie/e their target co/ering the cost
    o! selling based on the Sales cycle o! 0 days #ut i! the
    allocation o! .5000 is considered within the + o! &00,000 -S(,
    then this will be a pro6table model

    #ased on the pre/ious e)perience employing S7 FormPrint has to


    hire to manage these S7 and the cost >umped to 3.< o! the
    sales #ut instead o! hiring management can assign $ S7 under
    the FormPrint sales representati/e

    ?ow let us consider the cost aspect with respect to ndependent


    sales representati/e
    1 ndependent Sales 7epresentati/e
    ost o! Sales :$3< o! Sales;@Plus 1.,$0& -S(
    ta)
    Sales ycle o! ortho 500 0 days  units Per Annum
     +otal re/enue generated &08,000 -S(
    7e/enue a!ter ta) 30&,.. -S(
    ost o! Sales on total re/enue 103,$$&

     +he #ene6t in case o! S7 is that, FormPrint will ha/e /ery less
    6)ed cost !actor ith S7 there is no initial ris* because FormPrint
    will not be responsible !or their health and retirement bene6ts

     +hus FormPrint has to shell out commission o! $3< plus $3< as


    ta)

    e can ha/e an agreement with S7, such that i! he !ails to


    per!orm his responsibilities they can terminate his contract, i!
    there is no producti/ity

    hen S7 deli/ers signi6cant amount o! re/enue to FormPrint,


    then FormPrint can hire him !ull time with + ait !or the sales
    cycle to complete and e/aluate the !easibility o! continuing with
    them

    ! the cost to company is less than annual sales done by them, we


    can train them !urther and continue with S7sB else !all bac* on in
    house sales reps

     +he only issue with S7 is

    1; +here cannot be complete control o! independent sales


    representati/e
    $; +he training aspect depends on the ability o! S7, which
    cannot be measured

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