Within the Discussion Board area, write 400–600 words that respond to the following questions with your thoughts, ideas, and comments. This will be the fou
Within the Discussion Board area, write 400–600 words that respond to the following questions with your thoughts, ideas, and comments. This will be the foundation for future discussions by your classmates. This course uses a scenario in the weekly assignments.
As the firm looks for ways to offset the domestic downturn in sales, Deborah, the CEO of your company, wants to determine if a global strategy is a good fit for the organization. She has designated you as the manager for this project. You will work with your team to develop a global marketing plan for your organization.
You begin your research in deciding if and what the global strategy should be. You get your team together and begin to discuss a plan on how you will research this possibility.
You start the meeting by saying “Let’s brainstorm and start to get a plan together for a possible globalization strategy. Tiffany, I’d like you work with me to begin researching possible locations.”
Tiffany says, “I think we need to research some locations, but I think there is more to it than that. There still needs to be a decision on the type of strategy or approach we are taking. Would we use a multidomestic approach, a global approach, or a transnational approach? I’m still not entirely convinced a global strategy is the answer.”
“Great point, Tiffany. It is obvious to me as well that we need to explore a strategy that will put us in a better position to handle the economic downturn. We have to provide the board with the facts. They seem to be leaning in the direction of a global strategy, but I’m not sure it’s the right move either. That’s why we need to do research.”
Domestic profit margins have dropped by 2% this quarter. You wonder how you and your team can help fix this. Is a global strategy the answer, or should the company continue to focus on the domestic market?
You call a team meeting to learn about the progress of their research.
Tiffany, one of your team members, begins the discussion. “I think we need to look at some of the internal factors,” she says. “We know what our capabilities are on the domestic front, but what about in the global market? We have a fairly strong market presence here in higher-end markets, but how does that translate globally?”
Discuss the following:
How do you define a global strategy?
Identify a minimum of 3 possible countries for globalization. Research each of these locations in the furniture industry, and discuss both the pros and cons of including them in a global strategy.
Of the three countries, what one country would you choose for globalization and why? MGMT690 Scenario
John Ferrer and his wife Deborah started their own corporation, a large custom furniture manufacturer located in Boston, MA. Their initial accounts were in the Northeastern region of the United States, and they annually observed a constant profit increase. They were able to grow the company enough to go from five distribution and manufacturing plants to 10 to allow shipping to 48 states. Although they have two retail stores, one located in Phoenix and one in Boston, their primary source of revenue is online catalog sales. They have 10 manufacturing plants and distribution centers throughout the country.
John and Deborah’s corporation is known throughout the industry for its exceptional customer service and superior quality. The contemporary designs lend themselves to a younger market, and the customer base is predominantly upper-middle class because it is one of the highest priced furniture companies in the market. Part of the appeal of John and Deborah’s brand is their consistent involvement with the local communities to create green gardens. They have also been a major contributor to organizations that build houses for people in need.
One of their primary strengths is their vertical integration. They have a team of in-house designers saving the company design costs and allowing the flexibility to rapidly change designs as the market changes. Their products have been featured on several prominent home design and gardening shows and have been endorsed by several well-known designers.
Because of a recent housing market sales decline, home renovations have slowed significantly. This has impacted the amount of furniture and fixture sales and continues to impact revenue. Furniture sales in the United States have decreased significantly, and John and Deborah have recently been discussing the possibility of global expansion.
Another potential threat to their company is that many higher-end brands have been marketing aggressively and creating lines for popular retail stores. These allow the lower-income consumers to have access to high-end brands at a much lower price point. So far, these lines have been incredibly successful and have significantly increased profits for competitors. Many of these competitors have also had great success in the global marketplace with these lower cost replicas.
John and Deborah know that it is time to seriously consider expanding their business. They want to be able to be sustainable and find other ways to increase sales and business. They are open to looking into the global market, but they want to be sure that it is the right move for the business. They have requested an advisory board meeting next month in which you will present the global marketing strategy. As the market strategist, you will play a key role in helping the board decide if this is the right move for the company.
You are sitting in Deborah Ferrer’s office. After the customary small talk, Deborah sits forward and states, “I am very impressed with the work that you have done as the strategic marketing manager. Since John and I started this company in Boston, we have seen continuous growth, but nothing like what we have seen since you started. However, the housing market is really starting to impact our profits. This last quarter’s numbers were not looking good.”
You reply, “We have some stiff competition, too, with the other brands creating retail knock-offs.”
She counters, “We’ve had great success with your strategies in the domestic markets, but we do need to think of a new approach and strategy. I have complete faith in your abilities to take this company exactly where it needs to go. I must say that we are really counting on you, and I know that you will follow through.”
“I will make sure that we do well. Do you have any new projects for me?” you ask.
Deborah smiles and says, “You know me well. I do have a new project for you. I sent you an e-mail just before our meeting. I’m curious if expanding in a global market would be a good move for our company. I would like you to look into this for me.”
“Our team is definitely up for the challenge,” you say with enthusiasm.
Deborah shakes hands with you warmly, and you make your way out of the meeting. As you drive out of the parking garage, you think about your success with the company. You cannot wait to get started.