Paragraph 2: Policy and Strategy in Global Competition
The policy of Baldwin is a wide segregation rendering excellent prices. Through our efforts, we have made an attempt in sustaining 44 products in the entire enterprises and offering excellent prices to our clients in the long established marketplaces. Our preference of offering the best prices has been drawn by clients’ concern on the prices of each company. From the results of the client review carried out in the previous year, we have preferred the segregation way that includes the physical traits needed by most clients. We also access reports from enterprises in order to find out the proper way of setting the goods, beginning with the first choice of the market.
However, we enquire about excellent prices on the basis of the excellent price policy under the principle of wide segregation. It is reviewed that several clients are not price receptive, and from them we make attempts to provide their supplementary wants and offer the finest charges to poorly developed areas and customary selling points. We have also maintained high charges in upper-end, huge and performing marketplaces, since the charges are not easily detected by clients in these areas. The company’s existing policy is not performing due to product imitation by competing enterprises. Our opponents have been able to win our clients by providing a substitute to the products preferred best by our customers. Due to this, we have lost a greater number of them.
Efforts to adjust with huge and performing structures have been futile even after attempting to balance Andrews’s charges and selling steps in little and customary marketplaces. Consequently, we have had insufficient gains and the selling allocation has gradually declined and moved to Chester’s, Digby,Eerie and Andrew’s premises. The declination of our company is estimated to be based on the sustenance of old products with the intention of investing more in our selling in the course of one year instead of updating the goods as it has always been the case. Even after committing the enterprise to R&D, supplying goods according to the client’s preference has not been easy.
It is noted that there was an increase in the company sales in the year 2014 to 2015, and the same case applied to the year 2016. The year 2014 placed the enterprise in negative incomes. The enterprise observed an increase in the net income from the year 2015 to 2016 after subjecting prolonged liabilities with the aim of financing the enterprise development. From the year 2014 to 2016, the net income rose to $7,452. The gross profits also rose to $16,712 in the year 2014 to 2016. The rise in the net incomes was influenced by the application of machines, which minimized the charges of production. The inventory turnover is increasing at a rate of 2.075% in each year.
2.2 Company’s Competively Important Resources and Capabilities
2.2.1 Company’s Resource and Capabilities
The enterprise assets and potential distinct it with related companies in the field. The company’s trade name is known to distant areas through our R&D group, which has played a very essential part in marketing the trade name. The other companies we partner with are a great source of wealth to our company. For instance, the manufacturers of our sensors have contributed in selling the trade name of our company, hence a resultant of increased sales to those who have heard of our enterprise.
The progress of the enterprise is dependent on the team’s effectiveness in providing market to our products. To achieve the top levels, we ought to make sure that we offer the proper training to our company workers. For the workers to perform in their posts, a minimum of 80 hours training is dedicated to each employee. Recently, the company spent $5,000 in the recruitment of each worker in order to attract potential employees, who will have the capability to give a higher output compared to a common individual outside the company.
2.2.2 Are Company’s Resources and Capabilities Potent Enough to Produce a Sustained Competitive Advantage?
The assets and potential of the enterprise lose value when they face improper management. Huge enterprises work hard when competing companies attempt to imitate their products. From this perspective, it is clearly noted that the assets and potentiality of the company is not lasting if not carefully preserved. When clients request for low prices from the enterprise, participation limits depreciate. Therefore, the enterprise is firm on providing machinery to the remote and customary markets in order to reduce extra expenses from the reduced labor. In this, the company will be able to meet the requirements of the clients, hence sustaining them.
The enterprise has plans to raise Total Quality Management (TQM) savings in every year from cheap labor and resources. If the company does not make these adjustments, there may be a likelihood of losing the market share to our opponents. We are obligated to make higher savings for the recruitment of workers. To sustain a competitive advantage, the assets of our enterprise are not in the required state. The company’s R&D team has exposed it to weak competitive pressure on the product growth. The old goods that we had stocked led us to increased losses, which declined the progress of the entire enterprise, giving way to our opponents.
2.3 Can Company Seize Market Opportunities and Nullify External Threats?
2.3.1 Company’s Internal Strengths (core and distinctive)
The enterprise has gained strength through the use of machines in the remote and customary market places like the dell and daze, which are among our central skills. Due to our on-time savings on machinery, the company has been able to attain greater achievements than general contribution limits compared to our opponents. This has been made easy by the use of machines, a project that has not been initiated by the rivalries. The low labor costs brought about by automaton have made it easy for the company to balance price declines by opponents and as a result, increased involvement limits is the company’s segregated skill.
The point that the company is well established in the low-end level makes it stronger compared to the similar companies. The size of the company’s gains originates from transactions in the low-end level, where our involvement limits are higher than those of competing companies. Our workers have sufficient job experience from the long duration of training they receive. The $5,000 fee dedicated to the recruitment of each employee also serves to strengthen the company. The experience of the workers leads to excellent products, which are a part of the company’s assets.
2.3.2 Company’s Weaknesses and Competitive Deficiencies
The company had not organized the R&D team to grab the market chances earlier. Neither did it make appropriate savings in auction and costs contrary to our opponents; Eerie and Andrew. The company did not make sufficient savings for the TQM, and a few savings done do not balance with relative competitor savings. Consequently, other enterprises enjoy a decline in material expenses, which places our enterprise in unsustainable competitive advantage. Improving the level of machinery in the remote and customary markets was part of our primary policy. The use of machinery has increased the involvement limits, although the company is accompanied by a long line of present and periodic debts, which have vividly diminished our gains.
The company has also failed in the acknowledgement of the possible losses that would arise from the enlarged competence. This involved the slowed process or the R&D to market the available products leading to delayed activity. The company faced huge losses due to the lack of proper organization of the R&D team and workers.
2.3.3 Company’s Market Opportunities
From the introduction of machines in the low-end and customary markets targeted by the company, we expect an increase in the market share index. This is because our company is superior to the competing enterprises, as a result of the trained employees, which calls for more sales hence a significant output. Our partnership with thriving companies also enables our company to gain more profits. This is because these partnerships make our company known to distant places. The production of unique products has enabled the company to auction more of its new products, attracting many customers to the industry.
The introduction of automaton, with reduced labor has minimized the general costs, attracting more customers, hence a forward step in the progress of the company. Our company is also working to increase the size and the activities of the company. This will be facilitated by the already recruited potential employees, who will increase the level of output leading an enlarged company size.
2.3.4 Company’s Threats to Future Profitability
As a result of the company’s previous shortfalls, the management of the company has been improved to higher standards, leading to innovative means to survive in the competitive market. These creative measures have been a threat to the company as our opponents are always looking for means to imitate the measures taken by our company. This has placed the company in fear of future declines hence excess work is done to oversee the company’s success.
The company has recently been stabilized by the current and long term debts. If the debts are not cleared with immediate effect, this may put the company in losses as witnessed earlier. Through the company’s strong foundation in the low-end and customary areas, it should take it as an advantage to make more profits and slowly pay the debts.
The company’s opponents also serve as threats to future profitability. The Eerie and Andrews have continued to save with the TQM, which has made it easy for them to market their products at a faster rate than the other competing companies. This has led to increased market shares suppressing those of our company. The big issue is to increase the market share and finance to the R&D teams to sell more of the company’s products. When the debts minimize, the company will have a chance to save with the TQM in order to balance with the competitors.