Marketing Strategy

Marketing Strategy: In contrast with the research findings of Scherer at al. , it is that in the pharmaceutical company large number of the diversified portfolio might not return huge profits. The strategy of the Rumack pharmaceuticals was that they expanded their product range to sustain and then capitalize upon the market share, which the product variants would secure for the company. In case of the pharmaceutical industry the rate of growth often demanded by the market to be sustainable for the company, usually would coerce the pharmaceuticals to engage in the low risk activities which was the same as in the case of Rumack. Usually in the case of the pharmaceutical companies producing and marketing a wider range of drugs would reduce the dependence on the so called specialized drugs. The strategy that has been employed in the case of Rumack seems to fit into the module of core model. The company has eventually diversified into a number of drugs rather than being dependant on a single most drug thereby taking advantage of the opportunity costs of the product ranges. Product choice of a company depends much upon the internal capabilities of the company which is evident from the fact that the company after closing operations in one of the particular plant transferred the packaging capabilities into the Bakersfield, in order cater to the growing demand of Restaolvic and Hedanol products. In case of this company they have tried to combine the mutually supportive capabilities. They have tried to develop a business model by integrating the drug line and the production capabilities. Furthermore, packaging is arranged as a line hybrid process. ”Pharmaceutical industry project, equity, sustainability and industry development Working paper series” , 2002)1 From the volume of the production being made it is implied that the company aims at developing the secondary sales figures, by fiddling with the availability of the products and increasing the liquidation of the product into the mainstream market. implication in manufacturing process: To study about the implications the foremost activity is to determine whether the product is innovative or functional. We may classify the product to perform a greater degree of the functional component. Hence, it can be understood that the market mediation costs of such pharmaceutical products will be very less because of the fact that we could ascertain the demand level of the commodity. Hence, the average margin of error in forecast when the time of production is committed is usually around 10% and the average stock out rate for such functional products could be around 1 to 2% respectively. The production facility at the Bakersfield was forced to cater to the rising demand level. Hence, a number of the product variants had to be produced. The manufacturing process is developed into a complex process with the production of each commodity and a dedicated process line for packaging of each commodity was developed. Even though the increased activity in the Bakersfield plant did not cause any problems in the manufacturing process, there were problems beginning to arise from the packaging function of the plant. Due to the rise in the demand and the company’s decision to diversify the portfolio the company did used the left over floor space by assembling additionally two more packaging lines in the same unit, but there was an inherent problem. The capacity of the additional two lines was very much underutilized i. e. the additional lines had to wait until the process was completed in the previous lines. Hence, this caused a delay in the production process as a whole. More time was being lost in the transition process than the original production process. Sources of problem for the company: As discussed in earlier section with the increase in the production capability and the under utilization of the packaging lines ,there is a ncrease in the lag time between the two processes, resulting in delay and leading to increase in time for the commodity to be produced. The production facility of the line 1 has been in such a manner that it can cater to one specific product range at a time, with the notion that the transition period is at minimal level, taking up to 4 hours. To avoid this, there was a strategic design taken. Line 2 was dedicated to pack bottles with with three different sizes resulting in the transition period of more than 5 hours. This directly affected line 3 and 4. Here, they had much more differing bottle sizes to pack, resulting in an increased transitional period of up to 8 hours which means that the time delivery of manufacturing in the lines 1 and 2 had been largely negated in the subsequent packaging. Proposed Strategies: •Can focus on process improvements to increase the run length. •Can focus on increase in capacity to decrease transitional period. •Analyse the impact of installing a new packing line to relieve the bottle neck. Reference 1. https://www. cfses. com/documents/pharma/01-Business_Strategy. PDF

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