Solution Pages: 9
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Structure of the Solution
Current Business Analysis
Diamond-E Strategy Analysis
Porters Five Force Model
Sample of Solution
Current Business Analysis:
The exclusive fashion apparel manufacturer, Mr. Jax Fashion Inc. became the leading women apparel manufacturer in Canada, due to its aggressive growth strategies and trendy orientations. With the desperate interests of the ultimate shareholders and the executives of the company Eisman, the president of the corporation, decided to aggressively penetrate the women apparel market while focusing on the smaller and medium sized retailers at the same time. Such augmentations along with the corporation’s core competencies ensured access for the company to over 400 departmental and specialty stores of Canada. Moreover, the company also diversified its portfolio of operations by acquiring four semi-related businesses that included Surrey Classical Manufacturing Ltd., West Coast Wollen Mills Ltd., Olympic Pant and Sportswear Co. Ltd and Canadian Sportswear Co. Ltd. Although, initially acquisition created potential problems of consolidation and systematic management across different business units. While also including the issue of assets shift in cultural preferences.
Strategy – Management Preferences:
The management of Mr. Jax Fashion Inc. has always prone to ensure exclusive growth in business operation and ultimate returns to the shareholders. Moreover, the president Eisman also focused on the execution of the same strategy and admired growth. Although, the ultimate objective of the management was to ensure growth, but they also consciously focused on the quality of products, innovative designs and accommodating service. Moreover, Mr. Jax also concentrated on diversification and mitigate the volatility of expansion and business operations. In pursuit of eventual expansion through diversification, the management also decided to go public and acquire semi-related companies.
Rivalry among the existing Competitors:
The existing competitors in the industry of Canada do not intricate rivalry pressure on each other, due to which the industry has become increasingly profitable. Moreover, local competitors don’t pose strategic threats due to the standardized mode of production and distribution. While, the variety among competitors’ offering, ensure equal opportunities for each entity.
Threats of the New Entrants:
Since the industry is quite lucrative in terms of the returns, potential investors are always in a tussle to enter such markets. Moreover, the cost for entering the market is also limited which eventually pose serious threats of the new entrants not only from local sphere but also from the global ecosystem.
Bargaining Power of Buyers:
The bargaining power of the buyers which in this case are distributors is vested in the alternative manufacturers have for their supply chains. Since manufacturers have to depend on the distributors and indulge in strategic relations for long-term orientation, The buyers hold an upper hand in such negotiations. Moreover, the switching cost for manufacturers is also high due to which they are not prone to change their distributors, even in drastic circumstances.
For the strategic execution of this scheme, the company should formulate project plan for each regional market to evaluate the alternatives in the retail chain. Moreover, the company should also benchmark its strategies of launching retail chain, with that of its competitors to get realistic insights of the expenditures and precautions. Moreover, with the establishment of the retail chain, the company would effectively be able to expand its market share and penetrate the U.S market while capitalizing its core competencies.