Du Pont

Overview In 1972, Du Pont found itself in a fortunate spotlight as it was faced with the following two options: 1.Continue with its lively strategy and maintain its current revenue stream; or 2.Modify its strategy and invest additional capital to summation its revenue stream in the future. As one throne imagine, multi-million dollar investment decisions such as these are not easily made and require a tremendous numerate of due diligence to include financial forecasting, labor ramifications, and massive research. Market Position Du Ponts position in the market place was fortunate for some(prenominal) reasons. First, Du Pont was a leader in the Titanium Dioxide industry possessing the highest talent for use of the ilmelite chloride process. Two recent developments in the industry, sharp increases in the cost of rutile ore required for the sulfite based process and the heightened environmental regulations enacted against domestic help sulfur based plants made the ilmelite chloride process more attractive. Du Pont had a emulous service in the ilmelite chloride process accounting for slightly 60% of the total market production in 1970. This advantage was strengthened by the fact that the trope two producer, NL Industries, was passing leveraged and the other producers in the market were relatively much smaller.

This competitive advantage translated to an average pre-tax profit margin of 40% double that of its competitors in the industry. Therefore, the company could afford to cut prices as necessitate to keep future competitors out of the industry and maintain market share. Finally, Du Pont was a large diversified company that spanned a number of different industries. While the blushers department, responsible for the production of titanium dioxide, was an authorized part of Du Ponts holdings, it was still the second smallest of Du Ponts ten departments. Therefore, the risk associated with the pigment department was fairly mitigated. The Issue The issue... If you want to get a unspoilt essay, order it on our website: Orderessay

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