Product details

Utex Industries of Houston, Texas, is a manufacturer of industrial fluid sealing devices for pumps and valves. As a result of the oil depression in early 1980s, the company suffered a decline in sales of one-third, but stabilised near the $20 million level. It finds growth opportunities in its traditional industry and home country market limited and has recently looked overseas for new prospects. Unlike even its larger competitors, Utex is a full line manufacturer, producing commodity-like packing seals as well as highly sophisticated mechanical seals with price tags up to $4,000 per unit. The case focuses on the strategic efforts of the owner/CEO to develop overseas markets in which Utex already had a toe hold. Having spent 50% of his time in the last two years on international, only 14% of sales are international, of which 8% are from Canada alone. Of strategic interest are the process for overseas distributor selection, the types of distribution arrangements, the management of distribution relationships, the nature of efforts undertaken by the CEO, the product mix targeted at overseas markets, the comparative competencies of the firm to enter the export or overseas investment arenas, and the difficulty of bringing the company''s staff on board to support the new thrust.