Om Scott & Sons

EXECUTIVE SUMMARY

Between 1955 and 1961, management of The O. M. Scott & Sons Company launched a number of new programs aimed at maintaining and increasing the company's past success and growth. Largely in response to these activities, Scott's field sales force grew from 6 to 150 men, several entirely new and expanded production facilities went on stream, and the number of products in the company's product line tripled. Sales increased from about $10 million to $43 million. In late 1961, company officials were preparing to review the results of all these changes to ascertain how, if at al1, Scott's plans and financial policies should be changed. The O. M. Scott & Sons Company commenced operations in 1868, when it began processing the country's first clean, weed-free grass seed. Scott's early business came from a small but rapidly growing local market in central Ohio.

Later, however, the company went through several stages in its growth. At about the turn of the centurythe company turned from supplying its local market to selling grass and other farm seeds over a wider geographic area by mail. As its success with its mail-order business increased, the company began to advertise extensively and in 1927 added a free magazine called Lawn Care, which has been widely distributed ever since. In all of these early promotional activities, the company sought to sell the Scott name and products as well as the idea of improved care of lawns. In the 1920's a special lawn fertilizer developed for home use was added to the company's product line. During the 1930's the company began to distribute its products on a small scale through selected retail stores and garden centers. Sales and profits grew steadily throughout these years. Scott continued to grow along these same general lines until 1945, by which time sales reached $2.7 million and net profits after taxes were about $30,000.

Over the decade following the Second World War, the company's pioneering research led to the development and introduction of a wide range of new chemical weed and garden pest controls and special-purpose lawn fertilizers. In addition, the company's grass seed lines were upgraded and supplemented. This research and development reaped a successful sales increase to $11.4 million and profits to over $210,000 in fiscal 1955.

PROBLEM

A. Institutional

What strategy should OM Scott implement do to position itself to capture the emerging market of potentially $100 million.

CORPORATE OBJECTIVE

- To improve distribution methods for the suburban market

- To improve their collections system

AREAS OF CONSIDERATION

A. ENVIRONMENTAL OPPORTUNITIES AND THREATS

Macro-Economic Indicators

Political / Economic

During the 1950s in the United States, manufacturing and home construction were on the rise as the American economy was on the upswing. The Korean War and the beginning of the Cold War created a politically conservative climate in the country, and the Cold War between the Soviet Union and the United States played out through the entire decade. Fear of communism caused public Congressional hearings by both houses in Congress and anti-communism was the prevailing sentiment in the United States throughout the decade. Conformity and conservatism characterized the social mores of the time. The 1950s in the developed Western world are generally considered both socially conservative and highly materialisticin nature. The beginning of decolonization in Africa and Asia occurred in this decade and accelerated in the following decade of the 1960s. The Library of Congress has dubbed the 1950s as the decade with the least musical innovation. The 1950s are noted in United States history as a time of both compliance and conformity and also, to a lesser extent, of rebellion.

(soruce: http://en.wikipedia.org/wiki/United_States_in_the_1950s)

Demographic

In the years after WWII, the United States, as well as a number of other industrialized countries, experienced an unexpected sudden birth rate jump. The cause of the baby boom was millions of men from the US who had to fight in WWII which prevented women from starting families and women also had to take the place of men in the workplace. The millions of men coming back and couples eager to start families led to the sharp rise in the US birth rate. Since the men came back got jobs in the workplace again, women became strongly pressured to once again stay home to take care of the house and children and let their husbands be the breadwinner of the household. Women felt great pressure to be married by her early 20s or else she would be considered lonely later on in life.

During the baby boom years, between 1940 and 1960, the birth rate doubled for third children and tripled for fourth children.

The total fertility rate of the United States jumped from 2.49 in 1945 to 2.94 in 1946, a rise of 0.45 children therefore beginning the baby boom. It continued to rise throughout the 1940s to reach 3.10 in 1950 with a peak of 3.77 in 1957. Declining slowly thereafter to 3.65 in 1960 and finally a steep from decline after 1964, therefore ending the baby boom.

(source: http://en.wikipedia.org/wiki/Demographic_history_of_the_United_States)

Socio-Cultural

During the 1950s, a sense of uniformity pervaded American society. Conformity was common, as young and old alike followed group norms rather than striking out on their own. Though men and women had been forced into new employment patterns during World War II, once the war was over, traditional roles were reaffirmed. Men expected to be the breadwinners; women, even when they worked, assumed their proper place was at home. Sociologist David Riesman observed the importance of peer-group expectations in his influential book, The Lonely Crowd. He called this new society "other-directed," and maintained that such societies lead to stability as well as conformity. Television contributed to the homogenizing trend by providing young and old with a shared experience reflecting accepted social patterns.

(source: http://countrystudies.us/united-states/history-117.htm)

Market Profile and Outlook

Post war mainstream thinking about success was about