Hi-Temp Products Corporation Case Study

Revenue and Profit Maximization for Different Market Models

HI-TEMP PRODUCTS CORPORATION:

To introduce you to this research, it will be necessary that I give you the history of this company and its affiliates. I will use this company as a model of profit maximization, which is one of the pillars of economic theory, explaining how companies seek to achieve an elevated level of profit to maximize their wealth and Benefits, just as individuals do with their level of utility.

This is a family business that my husband worked for in the early 2000. But first I must describe its supplier known as Kanthal. As of 1998 Kanthal Corporation had a monopoly in the United States being the only manufacturer and seller of Hi-Temperature materials.

Products fit in. This is really a rag to riches story. An employee named Antonio Silva, who worked in the furnace division seen the shutdown of Kanthals furnace division as inevitable and prepared for his dismissal.

There are many details to this story and it could be a novel if I chose to, but let’s keep it simple. Without anyone knowing, he strategically set up Hi-Temp Products corporation less than a mile from Kanthal corporation where he would be close to the raw products needed so that he could offer quick turn arounds. So now let me get to the point. Kanthal at first seemed disappointed that an employee could do this but later realized they could offer their furnace products through Hi-Temp products and Mr. Silva was a millionaire overnight. It seems that their marriage continues to grow since the name Kanthal is on all Hi temperature products that Tony sells. Today Hi- Temp Products Corporation. is one of Fortune 500 fastest growing company’s thanks in part to Kanthal. By the way I would like to mention that in the agreement between these two companies Mr. Antonio Silva, got access to everything that was once The Kanthal Furnace Division, and I mean everything from Storage of inventory to everything he needed to continue producing Kanthal products as long as he promises to buy from them