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INSTITUTO POLITECNICO NACIONAL

Escuela Superior de Comercio y Administración

Unidad Santo Tomas

FROYLAN RIVERA PEREZ


GROUP: 4NX32
ACTIVITY: Estrategies and tactics
ASSESSOR. Pérez Badillo Jemina Alejandra

June, 2015
Estrategies and tactics

INTRODUCTION
ASHBURY GUITARS

BACKGROUND

The Kim Guitar Company (KCG) in Seoul, South Korea, makes electric guitars for
Japanese manufacturers and distributors in Europe and the US.
A major US distributor, Ashbury Guitars, has contacted KGC about marketing a
range of guitars under its own brand name for the Californian market. , Ashbury
Guitars is a well - established company with an up-market image. It has had no
previous dealings with KGC. Ashbury’s owner, Richard Grant, plans to put three
models on the market: the Ashbury SG100 (the most expensive model), the SG500
and the SG200. The body of the guitars will have and experimental shape as well
as advanced technical features.

It is now early January, KCG has agreed to manufacture the guitars for Ashbury,
even though it is a very busy time of the year for them. The two companies have
had some initial correspondence by e-mail and now a face to face meeting is
required.

Several points of the contract need to be negotiated. KGC’s owner, David Kim, has
flown to San Francisco to meet Richard Grant. At the meeting is to make a deal
acceptable to both sides, and which could be the basis for a long term relationship.

Froylan Rivera Pérez


Estrategies and tactics

Task
You are a member of the KCG Team: David and Marketing Director
Read the information files. Identify your priorities and work out your strategy and
tactics. Then negotiate so that you get the best deal for your company.
Case Study: Ashbury Guitars

Froylan Rivera Pérez


Estrategies and tactics

ESTRATEGIES OF NEGOTIATION
INFORMATION AND SPECIFICATION
The Kim guitar company, established in 1997, is a specialized manufacture in
electric guitars and classic guitars and acoustic guitars and musical instrument parts
and accessories.
Ashbury musical instrument is a company dedicated to the design and
manufacturing of high quality musical instruments and accessories at affordable.
First of all, we would like to briefly introduce the electric guitar. An electric guitar is a
guitar that uses the principle of direct electromagnetic induction to convert vibrations
of its metal strings into electric audio signals. Invented in 1931, the electric guitar
became a necessity as jazz musicians sought to amplify their sound. Since then, the
electric guitar has become the most important instrument in popular music. It has
evolved into a stringed musical instrument that is capable of a multitude of sounds
and styles. It served as a major component in the development of rock and roll and
countless other genres of music.

Specification of SG1000
-Body : Arched Maple top mahogany back
-Neck : Mahogany (set-in Neck)
-Fingerboard : Ebony 22F (350R)
-Bridge : SGB-IIIG
-Pickup : "SGH-1SOB" (Alnico V) x2
-Control : Front volume, Front tone (Bi-Sound SW), Rear volume, Rear
tone(by Sound SW),3P selector SW
-Scale (mm) : 628
-Hardware : Gold
-Finish : BS(Brown Sunburst) , RS(Red Sunburst) , BL(Black)
- High quality Hard Case include(SGFC)

Later 1970's model. 2 x HB .. pretty "stock" set up. Maple topped, decorative
headstock + fret markers. Mine is red. Set neck, MIJ. With original case. "Les Paul"
type set-up. Nothing fancy: 2 x PU, 4 x controls. Pretty sure it is maple cap (not sure
of base timber) and ebony board.

Froylan Rivera Pérez


Estrategies and tactics

SG-200 offers a superior combination of electrical and mechanical properties -


properties such as dielectric strength, flame resistance, arc and track resistance,
high and impact strength. These fiberglass-reinforced polyester thermoset sheets
will not melt under heat and have excellent overall electrical properties.
SG-200 electrical insulating laminates have inherently good dielectrics. SG-200 has
been engineered to maximize the specific properties required for a electric guitar.

PERSUASION TACTICS AS BASED ON EVENTS

“So electric guitar is a strong demand on this market of Californian, upcoming


have music festival, with quantity 2,000 guitars will not have any problem to
sell the stock during the music festival”

NEGOTIATION

To reduce costs of production, we want 40% of the order to be manufactured


by other Korean firms.

-About transportation costs, we will be all prices include transport costs to


Pusan, Korea.

- Delivery before 8th June

About price for the SG1000, we couldn’t reduce price for product SG1000

Offer an additional 5% discount on all purchases of the SG1000, and 7% for


second and further orders. An agreement is to be ironed out on the optimal...
hope Ashbury guitar will satisfied with our method.

About guarantee, we usually offer a guarantee of 5 years.

Froylan Rivera Pérez