InPart Case
...$5.814 million (8.3%). After successful penetration of Pro/Engineer Seats, InPart should make efforts to be fully compatible to the major CAD systems. The decision now, however, should be to concentrate its efforts with Parametric. 2) InPart is considering four options for distribution channels. Which one do you recommend? Why? InPart is employing a model which leverages the Internet similar to the ASP model. The model has cost advantages (“one to many” offering) while allowing for a short sales cycle. InPart should pursue several distribution channels concurrently with emphasis in launching the channel most consistent with the overarching strategy (to launch with Parametric) and pursue a focused market share strategy. This will allow InPart to gain immediate traction/sales and allow for the product to be “evangelized” by individuals within larger companies, thereby making company wide sales easier. Resellers are an attractive option given widespread distribution and cost. But InPart’s solution is a new one which certainly needs education (a message best controlled by InPart). An exclusivity arrangement with resellers should not be pursued due to a loss of control. A direct sales force is too costly but I would recommend that InPart establish a relationship with Pro Engineer’s sales force (Parametric’s direct sales force). Parametric already has established relationships and the only downside would be that new channels would have to be established after a fully compatible CAD offering is available (perhaps resellers or an inside sales force). Moreover, Parametric’s sales force can go after company wide accounts and manage a 3-6 month sales cycle. I would also recommend that InPart establish a small inside sales force. Consistent with a lower price market strategy, an inside sales force is an extremely effective distribution channel. Advertising in trade journals, trade shows, targeted direct mail and word of mouth will generate leads most effectively served with an inside sales force. 3) InPart hasn’t decided how to price their service, What is your recommendation to them regarding how they should set pricing? Why? A perpetual license or by-the-part pricing is not the way to go gi...