Jack Tyler
Joined: 30 Nov 2010
Posts: 400
Location: Recently moved to Jacksonville, FL
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| Posted: Wed Jan 19, 2011 8:32 am Post subject: |
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This is helpful information, as it paints a picture of how different CSA's current business goals are from what Piper's financial aspirations probably were. (As expected, 'differing philosophies' boils down to money). CSA is floating an IPO and concurrently trying to broaden its markets (military trainer sales, broader international distribution, more instructional sales). IOW it wants to grow internationally. However, we don't see in its announcement any reference to increased manufacturing capacity. That boils down to a relatively fixed supply of a/c needing to fill a potentially expanding number of sales slots. If we were Piper - and of course, business growth would be our goal as well - we would be seeing this as an undesirable restriction on growing your domestic sales while overhead costs associated with the master distributorship are probably somewhat fixed.
From a macro perspective, both companies appear to be making rationale decisions. From a (N America) customer perspective, it may end up meaning little in the near term, given the alliance of regional distributors that was announced. From the individual distributor's perspective, slowish sales volume probably fits the financial realities of the current economy that they must accept for now. But it appears that all of this is driven by the financials (no surprise; we are talking business here...) rather than decisions being being made on some high philosophical plain. That's my take, anyway... |
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