...Identify Your Competitive Advantage Christopher Mullins Janine Przybyl BUS 100: Introduction To Business July 20, 2013 The Cheesecake Factory Inc, is a business that knows how to utilize their strengths, capitalize off their weakness, take advantage of opportunities and evade threats. Business in a capitalism or a free market are competitive and can be brutal if you don’t do a proper S.W.O.T analysis and understand the internal and external factors that impact businesses. Even though the family’s business has alway been different and had little competition since the close of their small business in Detroit, the Overton family has had great pie. Yet, it was the relentless work ethic and the open mind to new technology that allows The Cheesecake Factory Inc. to currently have 151 restaurants under their name; not to mention being the United States distributor of cheesecakes. The way Evelyn, Oscar, and later their son, David, used the S.W.O.T analysis to build the American dream was difficult at times, but the Overton family made it look easy as a cheesecake pie. The moral and work ethic of Evelyn and Oscar was the backbone of this successful company, along with a warm, casual dining experience, and great menu options. In a free market you want to make your business and product different so that you can have an advantage; Evelyn’s recipe was this advantage. The Cheesecake Factory Inc. began in Los Angeles during 1972, where the elderly couple worked long...
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...successful exploitation of a unique market niche. The company has been able to achieve over 20% market share in a highly competitive industry. A number of industry changes are occurring at the time of the case, including the consolidation of major industry players. New strategic moves implemented by Enterprise’s management should take into account these new industry dynamics and an increased competitiveness. Enterprise participates in a highly competitive industry. The market is generally divided into two segments: airport rental businesses and home-city rental businesses. Customers in the rental car sector have significant bargaining power and demand seems to be very elastic, leading to significant price competition. Price wars are generally higher in the airport business. Switching costs are very low given the lower customer loyalty and high product substitution. That is, prices charged by rental companies are limited by the alternative option of hiring a taxi service. Furthermore, bargaining power of suppliers is moderate. Fleet costs account for nearly half of operating expenses and are highly dependent on Automakers’ performance. In years were automakers were in trouble, fleet costs reduced significantly as manufacturers were selling inventory at massive discounts. Yet, these discounts disappeared as the auto market improved. The ability of rental car companies to manage fleet costs effectively differentiates the costs structure of market players. Enterprise has been successful...
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...performance. A financial review of each product will be undertaken as well, focusing on sales, costs, profitability, prices, and unit margins. I will then conduct a market review which will cover subjects ranging from new sales, previous sales, and market saturation. Finally, I will propose an alternate strategy, specifically in terms of pricing and R&D allocations. Initial observations indicate the previous VP of Marketing, Mr. Joe Schmoe, was satisfied with his opening assessment of the three products and was therefore content with keeping the project on autopilot. His satisfaction was ultimately unworthy and premature, as the CEO, Ms. Sally Smothers, does not believe these products are being developed and marketed to their fullest potential. There are a few key areas in which I can find fault with Mr. Schmoe. First, his inclination to disregard changing market forces. This is demonstrated by lack of motivation to make any changes whatsoever, despite making observations that each product performs differently. He is also negligent to make any adjustments based on future predictions and estimates. Areas in which he could have made an impact include R&D, manufacturing, and obviously marketing and advertisement. His lack of imagination has proved to limit the potential of our three tablets. Though X7 is new to the market, it has failed miserably thus far, even though it is the least expensive to produce. His lack of attention to this potential profit maker is inexcusable, and...
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...Classic Airlines has expanded their service to over 240 cities, over 2,300 flights daily, and have over 375 aircraft in their fleet (Phoenix, 2012). As we assume how difficult and competitive airline business is by seeing the records of airline bankruptcies such as filing the bankruptcy of the Northwest Airlines in 2005, that of the Delta Airlines in 2005, and the US Airways in 2004 (Foxbusiness, 2011). The airline industry knows itself that the airline industry as a sector has had decreases in profits and reductions of consumer loyalty. Classic Airlines is no different from the rest of their industry so they have seen a 10% reduction in their share prices. They have the 19% decrease of Classic Rewards members and a 21% reduction in flights per remaining member. Because of the rising costs such as fuel and labor, Classic Airlines has experienced other external difficulties (Phoenix, 2012). These factors greatly have affected the corporate culture and employee confidence in the performance of Classic Airlines. A new marketing plan is essential in regaining a larger market share of the airline industry, through maintaining customer loyalty, and targeting new customers. There are many concepts that should be considered in a company’s marketing plan that will enable airline companies to be more competitive and successful. Marketing Concepts Some of the marketing concepts I can apply for Classic Airlines include: the selling concept, the marketing concept, the relationship...
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...early years of the company, it positioned it core competency in the upstream side of the business (research). But due to shift in value in the pharmaceutical industry, Millennium was forced to evolve from the research company tag. Since most of the big leaps in the realm of scientific knowledge had been made, this stage was not lucrative enough, resulting in migrating to the downstream (delivery) side of the business. Also, by remaining in the upstream Millennium had to compete with many companies in the pharmaceutical industry who were targeting their current research programs on the same diseases. Hence placing a premium on innovation in the value chain boosted the efficacy of a drug relative to that of other competing drugs. This transformation is analogous to the position of a ‘specialist’ to a ‘generalist’. Yet, this was not enough for long term sustainable profitable growth for the company. As the CEO and founder points out that it requires more than just two areas of specialization in the value chain to be a market leader. The aim was not easy but yet achievable through a series of long term strategy plans and a variety of short term tactics. They moved away from dealing in partnerships via equity based deals to fully fledged mergers and acquisitions. Millennium was laser focused on achieving the ultimate goal producing its own products and serving them to the consumer directly, in turn giving more power to the company. At the same time, importance is laid on the cultural...
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...Relevant Economic Trends With the exception of supercenters such as Costco and BJ’s, the fastest-growing portion of the overall retail industry in the United States during the past decade has been in the dollar store segment. From 2000-2005 dollar stores had a compound annual growth rate (CAGR) of 10.2% which was nearly double the 5.6% CAGR in the retail industry as a whole. Sales from these discount stores were $24.7 billion in 2000 and were expected to more than double to $51.1 billion in 2009 (Exhibit 8). Two main drivers fueled this growth trend. The first was a cultural shift in consumers towards a bargain-based mentality. This was spurred by an increased presence of retailers with a low cost strategy including Wal-Mart, Sam’s Club, and Target over the past three decades. The second was the rising number of Americans falling below the poverty line as well as the number of people on fixed incomes due to the rapidly aging population resulting from the baby-boom after World War II. While the CAGR of dollar stores was forecasted to slow to 6.2% during 2005-2009, the actual decrease is likely to be smaller as more consumers try to stretch their dollars further through these retail outlets because of the global economic downturn of 2008. Industry Analysis Dollar General (DG) operates as an extreme-value retailer in the dollar store segment of the retail industry. Other categories that dollar stores fall under are single-price-point retailers, close-out retailers...
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...• Choose the two (2) segments of the general environment that would rank highest in their influence on the corporation you chose. Assess how these segments affect the corporation you chose and the industry in which it operates. EBay Inc. Is one of the leading internet companies in the world. Founded in 1995 by French Iranian Pierre Omidyar, eBay is employing more than 15500 people while generating total revenue of 11.65 billion dollars as of 2011 (eBay Inc 2011 Results). The company was founded in San Jose, California with a vision of connecting people rather then sells them goods. The company has now about a billion registered users and is the most popular shopping site on the Internet. EBay’s mission is to provide a global segment platform where practically anyone can trade practically anything. It features a variety of international sites, specialty sites, 50,000 categories of merchandise, and services that aim to provide users with the necessary tools for efficient online trading in both auction style as well as fixed price formats. Recently eBay added a Want It Now and Best Offer format providing new ways for shoppers to find and buy what they want on the website. Europe, Asia and cross-border trade are major areas of growth for eBay and an immense source of revenue. The firm offers localized sites in 24 countries. On any given day, millions of items are listed on eBay in thousands of categories. People from all over the world buy and sell on eBay (Hellriegel...
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...Microsoft struggles as consumeres replaced traditional pc ‘s for tablets and smartphones. Critics say microsoft has been to slow to respond to the booming market mobile devices. It is a necessary gamble for microsoft to break into mobile, but given its complete reliance on nokia for windows phones devices and competitive position of apple and google with rival phone plattforms an understanable move… WTF ???? Background: nokia founded in 1871 1987 launches 1st phone. = mobira cityman 2000 stock market value: hits 186billion euros ( now worth 11) 2003 basic 1100 launched and become sthe most popular consumer electronic device. 2011: abandons symbian mobile phon operating system and switches to the windows platform instead. 2013 : launches Lumia 1020 boasting a 41 megapixel camera. Sold 53.7 million devices during the quarter ( which one ) and down to 27% down sales on last year. ( does not make sense) Microsoft signed a dela to 10 year licensing arrangement with nokia to use their brand on current mobile phone products. Microsoft deal= strategy to transform microsof into an all – encompassin technology business covering hardware and software that can compete with apple and google. Deal disussed by elop and ballamar feb 2013 at the congress in barcelona taking place in feb. Nokia remaining business will encompass the worlds 3rd largest telecom equipmnet . a patent profolio generating 500 million a year and a large mapping...
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...so, how to price or what sustainable competitive advantage it needs to adopt during the next strategic period, given that it holds a large inventory of its now inferior product. This issue concerns the steel and plastic rings which the company, Precision Worldwide, Inc. (PWI) is opting to produce as a matter of competing intensively with a French company, Henri Poulenc, which was at the same time posing a big threat to the viability of the steel rings PWI is producing. . PWI is confronted not only with a substitute product which is both cheap and durable. Compared to PWI’s steel rings, the plastic rings being produced by Henri Poulenc is both cheaper and lasts longer. PWI is also facing the risk of earning the ire of its customers if it manufactures but selectively introduces the cheaper plastic rings in areas where it is faced with the ‘plastic’ competition. As a result, PWI is now confronted with a dilemma of differences in strategic measures to undertake given the differing opinions of its key people. Questions Posted for this Note: 1. You have to analyze the existing data, the conflicting views of the sales manager and the Development engineer. And make a decision as to whether PWI should begin the manufacture of a plastic ring. Answer: From the standpoint of the qualitative aspect of competition, PWI is encouraged to start manufacturing of the plastic ring if it is to avert a more serious consequence of being eased out of the market due to a cheaper, more durable plastic...
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...so, how to price or what sustainable competitive advantage it needs to adopt during the next strategic period, given that it holds a large inventory of its now inferior product. This issue concerns the steel and plastic rings which the company, Precision Worldwide, Inc. (PWI) is opting to produce as a matter of competing intensively with a French company, Henri Poulenc, which was at the same time posing a big threat to the viability of the steel rings PWI is producing. . PWI is confronted not only with a substitute product which is both cheap and durable. Compared to PWI’s steel rings, the plastic rings being produced by Henri Poulenc is both cheaper and lasts longer. PWI is also facing the risk of earning the ire of its customers if it manufactures but selectively introduces the cheaper plastic rings in areas where it is faced with the ‘plastic’ competition. As a result, PWI is now confronted with a dilemma of differences in strategic measures to undertake given the differing opinions of its key people. Questions Posted for this Note: 1. You have to analyze the existing data, the conflicting views of the sales manager and the Development engineer. And make a decision as to whether PWI should begin the manufacture of a plastic ring. Answer: From the standpoint of the qualitative aspect of competition, PWI is encouraged to start manufacturing of the plastic ring if it is to avert a more serious consequence of being eased out of the market due to a cheaper, more durable plastic...
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...In the first quarter, it was the goal of the company to focus on higher quality products, for a more discerning market willing to pay more. There was a secondary goal to use the prestige of the brand to incite interest in the lower end models that would be offered to the Workhorse level client. It was also the goal of the company to offer an affordable product that offered a higher value for the lower end of the market. With those goals in mind, customers needs were assessed for both sectors of the market to help determine what to include in each brand. For the Mercedes line, the Elite, any item that showed that there was either a clear or marginal need was added to the product. This same process was used for the Workhorse or Pro brand. One thing that was added to create value and differentiation from the rest of the market was each model was to have the fastest processor. Each quarter in the beginning we held almost 25% of the market, with three other competitors, we neither were behind or dominated it. Each Quarter would bring an updated model to each brand, with a focus on needs. Market research would tell of where items hit or missed the mark, and the brands would be redesigned to compensate for the misses. As the fourth quarter approached it became clear that the traveler market was interested in the type of products the company offered, so to corner that market a third brand was introduced (the Mobi), with a focus specifically on the traveler’s needs. As for the relationship...
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...------------------------------------------------- LVMH Moët Hennessy Louis Vuitton Purpose The purpose of this report is to fully analyze the conglomerate, LVMH Moët Hennesy Louis Vuitton SE at both an internal and external level in order to come up with a synopsis of the business’s current performance in the stock market. This project includes research of LVMH’s company background, competitive strategy, the industry: a financial study of the macroeconomics, short and long-term goals, the organizational structure, and financial management. This report will depict LVMH’s present position at all industry aspects to reach the final evaluation of its performance in the stock market. Introduction LVMH Moët Hennessy Louis Vuitton is the world’s largest multinational luxury goods conglomerate, formed in 1987 when Louis Vuitton merged with Moët Hennessy in a $4 billion deal. This group was formed after the 1971 merger between Moët & Chandon and Hennessy. The French conglomerate is headquartered in Paris, France. The LVMH group comprises 70 houses. It is the only group present in all five major sectors of the luxury market, selling: Wines & Spirits, Fashion and Leather Goods, Perfumes & Cosmetics, Watches & Jewelry and Selective Retailing (LVMH Company - An Operational and Functional Model). LVMH has 70 brands, consisting of a retail network of over 3,700 stores and employing 120,000 employees worldwide (LVMH Company - An Operational and Functional Model). With...
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...Question 1 – why large companies find it difficult to create new businesses Large companies like IBM usually have organisational architecture, routines and culture that have evolved and matured with its successful businesses. But being tailored to mature businesses, they may be a barrier to creating new, different, businesses. Consequently, large corporations may be upstaged by smaller companies armed with new ideas that subsequently become dominant in the market place. Reasons why large companies find it difficult to create new businesses include: • A focus on currently successful businesses (culture) As Clayton M. Christensen argues, when a firm’s core businesses are profitable, starting new growth ventures seems unnecessary (Christensen, 1997). Senior managers don’t focus on launching new growth businesses when the core units are strong, so miss potentially lucrative future business opportunities. Eastman Kodak, for example, lost the industry leadership it had held in the photographic media and equipment markets since 1888 because it remained focussed on film and film cameras and failed to offer digital cameras early enough. • A reluctance to take risks (culture) Related to this focus on current businesses, large, successful companies are sometimes more reluctant to take risks on new growth directions. One example of a risk-taking firm is NTT DoCoMo. Rather than invest in expensive bandwidth to provide greater support to existing customers with existing services as...
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...Automotive Market Structure CADILLAC AUTOMOTIVE Cadillac Automotive is a U.S based automobile manufacturer that manufactures luxury vehicles. The company is owned by General Motors. Cadillac originally used to make carriages. The company sells in more than three dozen countries with its major operations centered in North America. It is known to be the second oldest automobile manufacturer in U.S. after GM and Buick. The industry Cadillac operates in is highly lucrative and money making (SWOT analysis of General Motors, 2013). The luxury cars do not make money by mass production rather by selling on premium prices. Here is the analysis of the industry Cadillac serves in and a discussion of its market structure (Automotive Strategy, Planning & Analysis: IHS Automotive, 2013). MARKET STRUCTURES The market structure tells the way business is done in an industry. The market structure can be of four basic types. A market may have strong government regulations or no government intervention at all. Also the market structures differ on the basis of companies in an industry. Following table describes how automotive industry differs from other industries and what market structure it has. Cadillac Automotive | Oligopoly | Perfect competition | Monopoly | Monopolistic Market Structure | Industry: Automobiles * There are multiple automobile manufacturers * Some of the major players are GM, Ford, Toyota, Honda, Ferrari, Lamborghini, and BMW. | The oligopoly market players may...
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...management at INSEAD. This article is based on their book, Blue Ocean Strategy: How to Create Uncontested Market Space and Make the Competition Irrelevant (Harvard Business School Press, 2005). orporate strategy is heavily influenced by its military roots. The very language of strategy is imbued with military references – chief executive ‘‘officers’’ in ‘‘headquarters’’, ‘‘troops’’ on the ‘‘front lines.’’ Described this way, strategy is about confronting an opponent and fighting over a given piece of land that is both limited and constant. Traditionally, strategy focused on beating the competition, and strategic plans are still couched in warlike terminology. They exhort companies to seize competitive advantage, battle for market share, and fight over price. Competition is a bloody battlefield. C The trouble is that if the opposing army is doing exactly same thing, such strategies often cancel each other out, or trigger immediate tit-for-tat retaliation. Strategy quickly reverts to tactical opportunism. So where should companies turn for a more innovative approach to strategy? The answer lies with something we call blue-ocean strategy. We argue that head-to-head competition results in nothing but a bloody red ocean as rivals fight over shrinking profits. Success comes not from battling competitors, but from making the competition irrelevant by creating ‘‘blue oceans’’ of uncontested market space. The creators of blue oceans don’t use the competition as their benchmark. Instead, they follow...
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