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Apex Case Study Essay

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Given the limited information in this case, which product would you recommend that Apex commercialize? Why?

Apex, a chemical manufacturer, has the option of commercializing one of its compounds due to resource scarcity. Apex needs to examine both choices and take into consideration the analysis of market size and trend, value proposition, market knowledge and share, and forecasted revenue for each of the compound before it decides which compound to commercialize.

Compound A-115:
The first is Compound A-115, a new electrolysis agent. The electrolysis agent market is stable at $10 million a year with Hamfield occupying 95% of the market and customers are currently satisfied with Hamfield. Since Apex is not known in the electrolysis …show more content…

But Apex is not currently in the beta market and has been losing 10% of its sales per year and customers are insisting on betas. Even though there are three other competitors and a number of smaller, off brand competitors, Apex can utilize its existing distribution channels and brand advertising to attract new customers. If Apex decides to enter the beta market, Compound B-227 will be a line extension in the plastic oxidizer market for Apex.

My recommendation would be for Apex to commercialize B-227. Even though Apex is not currently in the beta market it still has a strong presence in the plastic oxidizer market based on stigones sales. Apex has no presence in the electrolysis agent market and is dominated by Hamfield. It will be extremely hard for Apex to compete in this segment. Also, there seems to be a lot more room for growth in the plastic oxidizer market compared with the electrolysis agent market ($40 million and growing versus $10 million and stable). Entering the beta segment would also tie into Apex’s overall strategy and would be considered a line extension for Apex. Apex already has an advantage in the beta market such as brand recognition, distribution network has already been created, and sufficient staffing and equipment. Apex would only need to capture 25% of the market share in order in the betas to get the same revenue potential which is more realistic than capturing 100% of the market in the electrolysis agent

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