MONTES CALCADOS: A STEP AHEAD
1. What is the critical problem or challenge facing the firm that you will try to resolve
The problem to sell the company’s product through online(e-commerce) (James L.Heskett, 2018).As a result of the increased advancement in technology and recent reduction of logistic means, companies are selling their products through online the field that is proliferating.
To address this issue, the company should focus in introducing their products in online which can significantly lead to an increased sale as many of the MC’s target customers are young generations and heavy online shoppers (James L.Heskett, 2018).
Expansion problem
This is another major problem that the Mc Company is facing whether to expand their operations and open more stores across the globe.
The company should focus first on the growing sales and demand for their products in Brazil and other large markets.
The Fashion Challenge
The other challenge is facing the company whether to pursue the fashion design or build them on the company’s long-running styles that are iconic. This is as a result of reduced taste and preferences to the company’s once hot-brands in the market.
The company should create four fashion cycles and increase advertising and promotions.
The problem of the aging population
This is another major problem that the company is experiencing as the company only targets the people between the age of 18 to 35. In a real sense, all the sales do not come from this population although the highest percent constitute sales from this population.
The MC Company should embrace even the older consumers as they will be loyal to the brand and spend more money that will lead to increased profits.
2. Your external analysis (the industry and economic environment, PESTEL/5 Forces
Political factors
Policies for growth which are essential for the MC Company such as international agreements on the tax, and low-interest rates,
Changes in manufacturing and tax laws and regulations in different countries as the company sell and designs shoe fashions.
Conflicts which are political can complicate custom related operations and may prevent exports and imports.
Economic factors
The collapse in economic factors would mean that the company experience reduced sales or switch to other lower and cheaper fashions if the economic conditions were not favorable.
The company’s success depends far on the availability of labor at an affordable price that makes the company enjoy significant profits and any changes in economic conditions forcing the cost of labor to go high may lead to reduced earnings to the company.
The MC Company has an opportunity to sell products to other emerging markets around the world with their deep finance and resources.
Social factors
Age and the gender distribution in the country and other possible and target market is a leading factor that may affect the performance of the company especially the distribution of females aged between 18 to 35 years.
The norms and the changing consumer tastes and preferences of the Brazilian people especially where the Company started and their primary target may be a significant effect on the operation of the company.
Technological factors
The emergence of new technologies for example online shopping has a significant effect on the marketing and advertising of the Company operates and products and reaching many consumers.
Marketing is also affected by the technology used by the company and the general methods of sales management and the company’s data management.
Legal factors
Legislative issues for the company to open new stores in different countries are a factor that may lead to success or failure of the business growth.
Consumer protection laws
Licensing regulations varies in different countries, and this may affect the company’s activities.
Sustainability affects the company’s operations and their extent of activities.
Management of waste products forms the company also affects the Company’s profits and operations.
3. Your internal analysis (the firm’s internal resources and capabilities, VRIO)
Value- the firm can easily access resources which are not much expensive
Rareness- the materials used to design and make new shoes and products are not rare and are readily available.
Imitability- the products and the resources are easy to imitate which can cause increased competition
Organization- the firm is organized in such a way that it can handle and exploit the available resources as it is managed by experienced management and designers who quickly changes the design of products to fit the market demand.
4. The mutually exclusive alternatives that can be used to solve the problem
Selling of the Company’s products through online or
Through the retail partners
Pros and Cons of each
Selling through E-commerce
Pros
The company will reach many customers and hence increased sales, and this will lead to high profits
Reduced logistic operations and activities
Reduced employees for selling of the Company’s products
Cons
Retail partners will suffer as a result of lost sales
The possibility of an attack by attackers
It may reach even those who are not targeted
Denial of service attacks may lead to reduced sales and other losses
Selling through retail partners
Will reach only the target customers
The retail partners will retain their sales
The brand of the company will remain valuable
Cons
The company may not achieve a significant market
The company will lose sales from online shoppers
The company may suffer future loses of competitors advance in e-commerce and sales become better.
5. The justification for the alternative I have chosen
The company should embrace sales through E-commerce because it will reach a large number of populations in the region, minimize logistic operations and also save salaries used to pay the sales personnel as they will be few.
References
James L.Heskett, J. T. (2018). MONTES CALCADOS: A Step Ahead.
