MARTHA'S DESIGNS Martha Millwork needs to make some important decisions regarding her clothing manufacturing business. Started as a hobby in the mid-2010s, the business has grown to the point where she has opportunities to expand the scale of operations so that it can become a full-time commercial enterprise. She is unsure of which markets to pursue, which marketing channels to use, and the extent of product line that would be the most effective Martha lives in Grente, Saskatchewan, and she had started sewing clothing for herself and her children in 2009. Her skal and talents were first shown publicly during the summer Agribition celebration in Regina in 2018 at a fashion show she organited. As a result of this initial show, she received orders from interested buyers, and the hobby soon became a part-time business that she operated out of her home in Grenfel. Company sales have grown steadily since that time and reached close to $30,000 in the latest fiscal year. Although this only brought a profit of $5000, Martha has fine-tuned the business so that an Increase in sales also means a larger profit percentage Martha's Designs specializes in high-quality, fashionable women's and men's coats made from canvas. denim, and Hudson's Bay and Pendleton wool blankets. The coats are Riesigned to be comfortable, sophisticated, and original. They also feature fut and leather trims. Several cost designs are available, and Martha modifies existing designs and creates new ones on an ongoing basis. The coats are well-made with high-quality materials, and are priced from $300 to $600. The clothes are fashionable and modem. This blend of fashion, function, and tradition make a unique finished product that she has successfully sold to buyers from across North America and Europe, As the owner-manager, Martha designs the coats and cuts the fabric. She usually orders materials only after receiving an order for a particular coat. The cut pieces, trim, and notions are sent to one of two part-time local seamstresses who do the sewing in their own homes. Martha carefully inspects each garment on completion. The purchasing of materials is an important aspect of the production process, since the cost of materials is such a large part of the cost of goods. Fabric is purchased at the lowest possible price, but Martha is aware that better prices are available if she increases the size of her orders. The unique trims used on the seats are purchased primarily from local suppliers 0 Recently, Martha was approached by the town of Wolseley (estimated population 1000), which is about 15 kilometres from Grenfel, to be a part of a sewing plant that the village is planning to establish. The village intends to purchase sewing machines and other equipment and contract out the sewing services of the workers to interested firms, such as Martha's Designs, Martha realizes that to make such a change in operations worthwhile, Martha's Designs wil have to increase its production volume dramatically. This proposal is attractive because of its low financial risk, the opportunity for increased production officiencies, and the flexibility to produce a greater volume of coats Martha's marketing efforts to date consist primarily of fashion shows, displays of events, a basic website, newspaper advertising, a small amount of social media activity, and a brochure Each year she organizes several fashion shows in Alberta, Montana, North Dakota, and Saskatchewan in the past, some of these were in conjunction with other events, such as the agricultural exhibitions, rodeos, and athletic events. Each show is the result of coordinating the individual efforts of models, commentators, hairdressers, make-up artists, sound specialists, musicians, and publicity staft Displays are set up at various trade shows and even at events such as Canada Day celebrations, in addition, a small amount of advertising has been done in newspapers, such as the Regina Leader Post and other local papers, Martha uses advertising to promote general awareness and to promote good community relations with a potential increase in production capacity, Martha has to plan the company's future marketing strategy. She is confident that demand for her company's unique clothing exists and that volume could be increased enough to result in significant material purchase savings, which would lower production costs. A major decision is which marketing channel to use Until now, sales have been made directly to purchasers of the clothing, Martha thinks she might achieve an increase in volume by selling through retail stores or clothing wholesalers, but she is unsure which type of retail store would most effectively reach ther target customer. An alternative is to continue selling directly to customers but to expand her online presence. Her current website amounts to a few pictures and her contact information. She would have to invest roughly $10,000 to have a fully functional website, and she has done very little to promote her business on social media. She is wondering if creating a website and using social media wouldn't lead to a significant increase in sales. Martha is also unsure if people would buy her unique products without seeing them in person Martha is also thinking about increasing the sales of men's and children's coats. Although this strategy would add to her product line and create additional design work, it could also make the line more marketable by broadening its appeal, A final decision to be made is how to support the sales efforts. Should she use more advertising, or should she concentrate on setting up soles booths at trade shows? There are many trade shows, and deciding which to attend would be difficult As Martha considers the alternatives available to her, she is beginning to realize that her company is at an important crossroads - to continue its growth, it would have to enter new markets and expand production capacity. Martha's Designs is a cottage Industry on the verge of becoming a small manufacturer Questions 1. Discuss the implications of Martha Millwork's potential expansion 2. Evaluate the distribution channel options and promotional implications associated with them if Martha's business expanded