Margaret and Anthony Simon (brother and sister) of Jackson, Wyoming, took over their parents failing western boot company, gave it a new name, Cima Mountaineering, Inc. and transitioned it into a successful, regional manufacturer of quality hiking boots. Cima's target market was primarily the outdoor enthusiasts and the company became known for its' traditional styles and innovative methods of manufacturing. Under the brother and sister team, the company experienced growth and product expansion. Cima Mountaineering is now faced with slow growth due to increased foreign and domestic competition, seasonal demand for goods, and changing market preferences.
             Cima Mountaineering, Inc. must decide on a marketing strategy for increasing the sales and profits of the company, and which segment to target for this expansion.
             Cima Mountaineering, Inc. currently holds 3% (18,738,529/600mil) of the mountaineering and hiking boot industry, targeting the serious outdoor enthusiast; mountain climbers and advanced hikers. Its most lucrative segment is the hiking category since it accounts for 84.10% of 1994 sales, with revenues of $14.4 million (see appendix 1). However, with increasing foreign competition, the company is finding it difficult to keep sales growing. The executives are considering expansion opportunities by diversifying in either a new line of boots for a less experienced weekend hiker (Project 1), or expanding the existing line of boots for mountaineers and hikers (Project 2).
             Project 1 presents the opportunity of targeting the recreational hiker by offering two new boots. This proposal is in light of the fact that the market demands are changing, which may threaten the company's current positioning strategy. Inexpensive, lightweight hiking boots are becoming popular and a new category of comfortable light shoes is being manufactured by competitors.
             The projected profits from 1997 to 2002 for this...