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C. STEWARTC. STEWARTJ. GIBSONJ. GIBSONJ. EMMONSJ. EMMONS

Intro to Stile & Rail….Intro to Stile & Rail….• TraditionalTraditional

National leader in S&R National leader in S&R

door manufacturingdoor manufacturing

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Established in 1985 in Grants PassEstablished in 1985 in Grants Pass

Mission Statement:Mission Statement:

RVD will continually offer an RVD will continually offer an extensive, high quality product in a extensive, high quality product in a time competitive mannertime competitive manner

Stile and Rail product Stile and Rail product

manufactured entirely from manufactured entirely from

Medium Density Fiberboard Medium Density Fiberboard (MDF).(MDF).

BBrand Extension rand Extension • Line Extension - New product in Line Extension - New product in

RVDs existing market RVDs existing market Product developmentProduct development

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STRENGTHS AND OPPORTUNITIESSTRENGTHS AND OPPORTUNITIES Cost effectiveness of MDF Cost effectiveness of MDF • Allows for higher marginsAllows for higher margins• Market Niche demands a premiumMarket Niche demands a premium

Ease of manufacturing Ease of manufacturing • Less waste involvedLess waste involved• Allows for shorter leads timesAllows for shorter leads times

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STRENGTHS AND OPPORTUNITIES:STRENGTHS AND OPPORTUNITIES: Core competencies Core competencies • GreenGreen compliance expands compliance expands

customer base to environmental customer base to environmental projectsprojects

• StileLine™ StileLine™ is conducive to paintingis conducive to painting• Brand recognitionBrand recognition• Mix-n-Match speciesMix-n-Match species

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WEAKNESSES AND THREATS:WEAKNESSES AND THREATS: Complexity involved with Complexity involved with

production and distribution of production and distribution of numerous small quantity numerous small quantity custom orderscustom orders

Exclusive distribution of Exclusive distribution of intermediariesintermediaries

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WEAKNESSES AND THREATS:WEAKNESSES AND THREATS: Labor costsLabor costs

• Even w/automation still very Even w/automation still very manualmanual

Competition – TruStileCompetition – TruStile÷ Law of Duality – TruStile & Law of Duality – TruStile &

StileLine™StileLine™

Imported productsImported products

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SOCIAL:SOCIAL: Society demands high quality Society demands high quality

custom building productscustom building products

Customers have become more Customers have become more involved in fulfilling their own involved in fulfilling their own needsneeds• One-to-one marketingOne-to-one marketing

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SOCIAL:SOCIAL: MDF products fit the “MDF products fit the “GreenGreen

TrendTrend””÷ Law of Acceleration - successful Law of Acceleration - successful

programs are not built on fads, programs are not built on fads, they're built on trendsthey're built on trends

LEGAL:LEGAL: Government standardsGovernment standards

and regulations:and regulations:• Fire CodeFire Code• Energy EfficiencyEnergy Efficiency• Sound Sound

TransmissionTransmission

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ECONOMIC:ECONOMIC: Lower interest rates: Remodel Lower interest rates: Remodel

and new constructionand new construction

Income distributionIncome distribution• Mid to High income customer Mid to High income customer basebase

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POLITICAL:POLITICAL: Trade policies dictate resources Trade policies dictate resources

such as raw materials such as raw materials • Tariffs are used to increase Tariffs are used to increase

domestic vs. foreign supplier domestic vs. foreign supplier purchasing.purchasing.

State and local lobbyists for State and local lobbyists for labor unionslabor unions

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TECHNOLOGICAL:TECHNOLOGICAL: Television/Internet have Television/Internet have

increased awareness of custom increased awareness of custom door optionsdoor options

Web based pricing allows quicker Web based pricing allows quicker MSRP quoting MSRP quoting

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TECHNOLOGICAL:TECHNOLOGICAL: AutomationAutomation• Computer Aided Drafting (CAD) Computer Aided Drafting (CAD) software allows customers to software allows customers to easily design their own product - easily design their own product - RVD.com

• Computer Numeric Control (CNC) Computer Numeric Control (CNC) machines improve speed and machines improve speed and design alternativesdesign alternatives

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Primary market will be the Primary market will be the new England States (Wealth)new England States (Wealth)• Due to existing demand created Due to existing demand created

by TruStileby TruStile• Existing customers desire a Existing customers desire a

product to competeproduct to compete÷ Law of the Ladder Law of the Ladder

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Potential to become direct competition

Competition to meet consumer needs

Our Point Of Difference is the Our Point Of Difference is the quality and product breadth quality and product breadth associated with RVDassociated with RVD

÷ Law of the Mind in termsLaw of the Mind in terms

of customizabilityof customizability

and qualityand quality

Market SegmentationMarket Segmentation

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Increase product awareness by Increase product awareness by 30% within the 1st year30% within the 1st year• Measured by customer surveysMeasured by customer surveys

$1 mm in sales within during 2010$1 mm in sales within during 2010

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Product Demand:Product Demand:

At 3,000 units per cycle (week), At 3,000 units per cycle (week), RVD anticipates 256 units per RVD anticipates 256 units per cycle for cycle for StileLine™StileLine™

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Sales are anticipated to Sales are anticipated to dramatically increase through dramatically increase through 2012 by over 100%.2012 by over 100%.

Product Life Cycle indicates Product Life Cycle indicates maturity by 2012 w/$2MM in maturity by 2012 w/$2MM in yearly salesyearly sales

Profit Margin EBIT @ 5%Profit Margin EBIT @ 5% ROI @ 7%ROI @ 7%

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THETHE

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RELATIONSHIP MARKETING:RELATIONSHIP MARKETING:• ARCHITECTURAL INSTITUTE OF AMERICAARCHITECTURAL INSTITUTE OF AMERICA• CO-OP PROGRAM –CO-OP PROGRAM –• 1% OF GROSS SALES SET ASIDE FOR CUSTOMERS TO USE 1% OF GROSS SALES SET ASIDE FOR CUSTOMERS TO USE

FOR ADVERTISINGFOR ADVERTISING

INTEGRATED MARKETING – 4 PS:INTEGRATED MARKETING – 4 PS:• PRODUCT – 5 YEAR WARRANTY, REPUTABLE BRAND PRODUCT – 5 YEAR WARRANTY, REPUTABLE BRAND

NAMENAME• PRICE – QUANTITY DISCOUNTPRICE – QUANTITY DISCOUNT, CASH DISCOUNT (1%/10 , CASH DISCOUNT (1%/10

NET 30) NET 30) PRICE DISCOUNTS TO CUSTOMERS FOR PAYING ON TIME PRICE DISCOUNTS TO CUSTOMERS FOR PAYING ON TIME • PLACE – FREIGHT ALLOWANCE BASED ON VOLUME, PLACE – FREIGHT ALLOWANCE BASED ON VOLUME,

DEDICATED CUSTOMER/SUPPLIER NETWORKDEDICATED CUSTOMER/SUPPLIER NETWORK

• PROMOTION – CATALOG, WEBSITE, PRODUCT DISPLAYS PROMOTION – CATALOG, WEBSITE, PRODUCT DISPLAYS FOR THE DEALER NETWORK, STORY IN “WINDOW & FOR THE DEALER NETWORK, STORY IN “WINDOW & DOOR” MAG, DOOR” MAG,

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INTERNALINTERNAL• TRAIN CUSTOMERS ON THE SPECIALIZED TRAIN CUSTOMERS ON THE SPECIALIZED

PRODUCT – ENVIRONMENTAL BENEFITS, PRODUCT – ENVIRONMENTAL BENEFITS, QUALITY, - TO BE ABLE TO HIGHLIGHT THE QUALITY, - TO BE ABLE TO HIGHLIGHT THE SELLING POINTS OF THE PRODUCTSELLING POINTS OF THE PRODUCT

• DEVELOP INTRANET WITH TRAINING DEVELOP INTRANET WITH TRAINING MODULES ALLOWING SELLER CUSTOMERS TO MODULES ALLOWING SELLER CUSTOMERS TO REFRESH THEIR MEMORY OF THE PRODUCTREFRESH THEIR MEMORY OF THE PRODUCT

SOCIALLY RESPONSIBLE:SOCIALLY RESPONSIBLE:• PROMOTE THE “GREEN” FACETPROMOTE THE “GREEN” FACET• EFFICIENT PRODUCTION – NO WASTEEFFICIENT PRODUCTION – NO WASTE• PERCENTAGE OF SALES DEDICATED TO PERCENTAGE OF SALES DEDICATED TO

CONSUMERS CHARITY OF CHOICECONSUMERS CHARITY OF CHOICE

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Law of duality – TruStile & StileLine Acceleration - successful programs

are not built on fads, they're built on trends

Ladder - Law of mind – in terms of

customability

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. Define the core competencies – Week 1 Slide 113 Mission statements – wk 1 sl. 119 SWOT – sl 136 Marketing plan – wk 1 sl. 147 (market overview) Slept – wk 2 #113 Income distribution – mostly high incomes

We need to state average cost!! Target marketing – wk 3 #104

Identify as a niche market – need fulfillment and demand a premium

Medium to high incomes Those remodeling or building

One to One ******* #112 What's our pattern? #115 Law of duality Law of extension Acceleration

Custom doors and Green is a TREND -

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Week 5 #129 Holistic Requires external, internal, and interactive marketing efforts External includes marketing mix activity Internal includes training and motivating employees Interactive marketing describes employee’s skill in serving the consumer

Wk 6 #92 - Brand extensions Two types Line - parent brand used on new product Talk about benefits of…

Wk 6 #119 – Our PO Difference is the quality level associated with RVD We have a POParity with TruStile Market Competitive Landscape - #141 TruStile’s weakness is h=their lack of Brand Name (share of

the mind)

Wk 7 #59 – Exclusive distribution of intermediaries #62 – discussing channel members 5 Ms W8 #75

Consumers like catalogs – wk 8 #58 RVD creates the Umbrella price – sets the new ceiling

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