Hot Wire

In: Business and Management

Submitted By richajariwala
Words 695
Pages 3
Hot Rod Marketing
Terry Walsh knew the time was right to move from being a small, “garage-based” company to a much larger enterprise. After spending years as a research chemist, Terry had launched out on his own. His goal was to develop a top-of-the-line fuel injector cleaner for both domestic and foreign automobiles. For 2 years, he worked with various formulas until the right one emerged. The product was named Hot Fire Fuel Injector Cleaner, and the company’s name was Hot Fire. Terry was positive Hot Fire would perform well against any competitive product. The market for fuel-injector cleaners is diverse. Numerous backyard mechanics sell limited amounts of their concoctions to local merchants and over the internet. Several formulas are even available on eBay. There is no guarantee of quality for these products, some of which may actually harm engine performance. At the other extreme, major companies such as STP, Gumout, and Dupont offer various grades of cleaners, from low-end products selling for around $3 per unit up to high-end versions priced as high as $30. The primary price determinant is the degree to which the product reduces congestion in a fuel injector. The higher-priced entries are more powerful and remove more “gunk.”
Terry’s Hot Fire Fuel Injector Cleaner was at the high end. The price would be $17 wholesale, per can. He hoped that dealers would charge no more than $25 as a retail price. Hot Fire sold in single containers as well as in multipacks of 6 and 12 cans. Each can held two treatments or applications.
Several potential markets are available for fuel-injector cleaners. The first is auto repair shops, including simple “lube and oil” change stores and more traditional repair shops. Many times, the proprietors of these stores welcome the idea of a small display of an auto repair or maintenance product, as long as the owner believes the…...

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