Fiberglass reinforcement market analysis and methods to increase sales

For current and potential dealers

We manufacture fiberglass reinforcements in Saransk. We thank our dealers for good job in the elapsed 2012 year, looking forward to fruitful cooperation in the new year and invite new companies for cooperation.

In this letter I’ll try to tell you about the methods to increase sales of our products. The first thing to note is that currently the sales are performed by our sales department and eight dealers in Russia and Kazakhstan. The products are of seasonal nature; the season starts in the middle of March with the peak in June-July, a short “slowdown” period in August due to vacation seasons, and ends depending on the weather in the middle or at the end of November.

Direct customers may be divided into two groups: construction companies (legal entities) and private clients (individuals). Both the groups have their specific features and drastically differ in terms of promotion methods.

Let’s start with the companies. In general, any construction company can be a potential client except for decorators. Reinforcements are used almost everywhere, someone substitutes metal with glass fiber easily, others are totally against. The main inhibiting factor is the PROJECT. Re-agreement of the project is not quick and simple, and to achieve it, you have a lot to do with the client –   to persuade, provide samples, etc. The process requires much time and effort, but the game is worth the candle. If a company tries composite reinforcements once – chances are that it will be your permanent customer with permanent volumes. The following construction spheres are of the greatest interest:

1.  Organizations specializing on industrial floor mounting. (In industrial floors metal substitution with glass fiber provides for great economic benefits and better strength. Such companies often receive orders from business entities and small enterprises with no floor projects at all)

2.  Organizations specializing in monolithic construction. (In the monolithic frame of high-rise building glass fiber has not been used so far, as opposed to sandwich panels of heat insulating walls and fencing structures, for which purpose fiberglass rods are used. The so-called TIES are the same fiberglass reinforcements cut into 20-45 cm pieces.

3.  Organizations specializing in low-rise construction. (They are I suppose the easiest to deal with, the loads in low-rise construction are rather low, and fiberglass application is very cost effective.)

4.  Organization specializing in agro-industrial construction (cowsheds, open platforms, garages, etc. it’s often easier to prove  economic benefits at construction of such structures.)

The methods of product promotion for companies are normally personal meetings with management representatives (Chief Engineer, Unit Manager or General Director of a company). At the meeting we tell them about the products and their benefits as compared with metal (cheaper, lighter, stronger), and offer a pilot lot. If a dealer has no chance to arrange permanent meetings with potential client management, they may confine themselves to making a database of the above companies in the region and call them one after another, send product information with further calling. As practice shows, advertizing in periodicals, on the radio, in specialized construction magazines, on TV is very inefficient for attraction of companies, but the situation with private clients is quite opposite.

Private clients: For a start I’ll tell you a short story. When we just launched production, we were naturally focused on large-scale wholesalers and attraction of dealers. We made no advertizing at the intraregional market at all. In April of 2012 we faced the situation when the sales to retail customers constituted about one third of the total volume of sales according to the month results. We carried out analysis and found out that someone saw our products at his neighbor’s, someone heard about them from friends, in short, word-of-mouth advertising. Of course we started advertizing in newspapers, on the radio, on banners, and on TV. Efficiency assessment of all the methods showed that the highest efficiency of advertizing was achieved from ads in small specialized magazines distributed in construction stores, in office buildings and being in open sale, for example “Vse Dlya Doma”, “Stroyka”, “Dachny Sezon”, etc. A magazine should exist at the regional market at least for three years and have at least 5,000 circulation. TV advertizing is very efficient, though its cost is 2-3 times higher than the cost of other methods, but if the budget allows TV may produce a very good result in the very beginning of the season, when half of those who are going to build something is ready to get construction materials, and the other half is choosing what to buy.  It may also very useful to place ads in a weekly regional newspaper issued for mainstream audience. There are two-three most popular newspapers in every region. Basing on the advertizing budget, it is necessary to choose the most popular newspaper with the biggest circulation. In the article there shall be a photo of private house construction site and possibly an interview with a happy buyer of fiberglass reinforcements, which can be delivered in a baggage compartment, which are much cheaper, lighter, easier to mount, and stronger than metal. If necessary we can send a sample articles at a dealer’s request.

The second most efficient method is a banner; it should be located near cluster home communities and construction material warehouses – the number of clients attracted is less than as a result of advertizing in newspapers and on TV, and this method is expedient only if the price of advertizing is not higher than 6,000 rub per month. Then comes the radio – the lowest result, we consider it inexpedient.

The best advertizing strategy is as follows: At the end of February publish an article about reinforcements in a newspaper with a high circulation, the information may be combined with information about other new products the dealer is going to sell during the season. The information will be received by wide audience, someone will immediately write down the telephone number, someone will take interest and then forget. Re-publish the article with small changes in the middle – at the end of March in another newspaper with a high circulation. At the beginning of April publish advertisements in local construction and repair magazines (1-2 magazines will be enough) for the period from 1 to 3 months depending on the budget. In our region such campaign will cost about 30-40 thousand rubles.

For promotion and support issues please call 8 (800) 333-38-64, Sukharnikov Alexey.

Looking forward to cooperation with you,

Best regards, Malashkin Alexey.

Please note that since February 15, 2013 we offer seasonal discounts on our products, and now it is most  profitable to buy them for sale at the beginning of the season.

Price list for САС fiberglass reinforcement rods – “Armatura+”

Outer reinforcement diameter, САС, mm Price inclusive of VAT for 1 linear meter (rub.)

Theoretical weight

1 linear meter 

Linear meters in 1 ton of the product
4 6-50 0,02 50 000
6 8-50 0,05 20 000
 8 14-00  0,08  12 500
 10 19-00  0,12  8 350
 12 26-80   0,2  5 000

Please note that in 2012 we worked a lot on improvement of product and package quality. Now reinforcement can be transported in a baggage compartment without any risk of sand spattering.

Product coiling:

 

Certified.

For cooperation please call:

8 (800) 333-38-64

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