Elan & the Competition Ski Boat Industry

IQRA UNIVERSITY

NAME                                       KOMAL RIAZ

REG #                                        27745

ASSIGNMENT #                      01

COURSE                                  STRATEGIC MANAGEMENT

SUB TO                                   SIR AHSAN DURRANI

DATE                                       09.MARCH, 2017

DAY                                         THURSDAY

CASE STUDY:

ELAN & THE COMPETITION SKI BOAT INDUSTRY :

Q#1 what are industry’s dominant features?

MARKET SIZE & GROWTH

This industry is a big industry estimated sale of $ 25.6 billion in 2000, an increase of 15 % from 1999 the industry has faced steady growth since it was emerged & the position of this industry in life cycle lies in maturity

SCOPE OF COMPETITIVE RIVALRY

There are many rivals & competitors in this industry some compete because of using differentiation & some compete by using low price strategy

PACE OF TECNOLOGICAL CHANGE  

Technology is another important factor in this industry to be in this industry you have to be upgraded with technologies as competitors’ are because upgraded equipments has been the core competency in this industry  

LEARNING & EXPERIENCE CURVE EFFECT

Master Craft & Correct Craft being pioneer in this industry because they know the importance  of this effect

Q#2 Analyze poster’s five forces acting on the industry. Draw your conclusion about the industry

BUYERS

• Product differentiation & innovation
• Brand identity a important factor
• Backward integration
• Threat of substitute product available in market

SUPPLIERS

• Suppliers of ski boat industry are concentrated
• Substitute sellers are present
• The cost important is effect inputs on cost in big way
• Differentiation

RIVALS

• Differentiation & innovation doing by rivals ( master craft & correct craft)
• Value added features & premium services provided by them
• Identity of their brand

SUBSTITUTE PRODUCTS

• Switching cost
• Innovative & high on technology are appreciated by customers

ENTRY BARRIERS

• Capital expenditures
• Customer loyalty to Master Craft, Correct Craft & Malibu is high

POWER OF BUYERS

[pic 1]

POWER OF SUPPLIERS

[pic 2]

THREAT OF SUBSTITUTE PRODUCT

[pic 3]

THREATS OF NEW ENTRANTS

[pic 4]

COMPETITIVE RIVALRY

[pic 5]

INDUSTRY ATTRACTIVNESS

CONCLUSION

The industry is highly favorable because

• There are high capital requirements, strong brand loyalty & government policies
• The product of rivals are strongly differentiated & sales are connected among a few large sellers
• Substitutes exist in a variety but due to prices they cannot affect actual product
• Industry account for a big fraction of supplier’s sales
• Buyers are small & numerous relative to sellers

Q#3 what are three or four drivers of change for the industry

DRIVERS OF CHANGE

• The product innovations can be a key driving force because it can widen the degree of product differentiation among the rival sellers.
• As Malibu is known for its innovation and quality
• Master Craft is gentle giant & using EFI engines
• ·The advance in technology can make it possible to produce new and better products at a lower cost. This can cause changes in the capital requirements, and even the learning or experience curve effects.
• ·The changes in long-term industry growth is affecting the industry because it heightens the competitive pressures, thus creating a battle for more market share. This may force some companies to close their doors.
• ·The shifts in buyer demographics can alter the competition by forcing adjustments in the customer service, or bringing different sales and promotion approaches into play.
• ·New marketing innovations can affect the buyer’s interest, increase product differentiation, and even lower unit costs.
• ·These innovations can cause the rivals to come up with a new strategy. There is a growing buying preference for differentiated products.
• ·Buyers are looking for new features, style changes, and more options. This can change the industry because the rivals are always looking to out differentiate the other.
• ·The consumers want more companies to offer warranties and they are starting to and this a major driving force.

Q#4 what are strategic groups within industry

• The strategic groups within industry, 2 are competing on high prices & many models. Master Craft the oldest & innovator & Malibu who just cross the Correct Craft & now competing with top most ski company. They both are making 15models in the industry. Dealing in wholesale & retail however no correct craft Is now emphasizing on better product line to compete with these two. There are also many other companies like infinity boats are part of strategic group

  [pic 6]

Q#4 what are key success factors in the industry?

KEY SUCCESS FACTORS

PRODUCT INNOVATION

• Correct craft became the innovator of two-boats & enjoy the second position for almost a decade
• Malibu boats over take Correct craft position by their consistent image of being innovative
• EFI & V-drive engine is the latest innovation which gives speed boats one of innovation that customer go for

PRICE & QUALITY

• It is another factor that leads to success, Malibu has managed to prove it
• Many competitors compete on low prices & thus cutting edge of major manufacturers

PROMOTION PROGRAMS

• People are not well aware of products
• Need to be educated about this industry
• More than 60% customers are attracted giants like boat shows
• Giants like Correct craft face loss due to its poor promotional activities

RELATED TO MANUFACTURING

• Buyers require customization
• Malibu boats have been keen in customizing for their customer specification
• Advance manufacturing method & technologies should be key success factor in this industry

Q#5 Develop competitive profile matrix of the major competitors on those KSF?

COMPETITIVE PROFILE MATRIX