SWOT Analysis for Furniture Brand - Assignment Example

Project Table of Contents Table of Contents 2 Question 3 a.SWOT Analysis 3 SWOT of Human Resource Management 4 SWOT of Finance and Accounting4 SWOT of Marketing 5 b.Organisational Culture 6 Question 4 6 a.Type of Customer 6 b.Societal Marketing and Green Marketing 7 c.Human Resource and Finance Issues 9 Question 5 10 a.Globalised Business 10 b.Drivers of Globalisation 11 References 13 Question 1 a. SWOT Analysis Strength: Raft is using reclaimed wood to make furniture. The cost of reclaimed wood is very less than fresh wood. A known brand in furniture world, since it is 11 year old company. They have 25 franchise stores to distribute their goods. The company is doing well and earning profit, last year £ 3.3 million of sales from three stores. The company have enough money for financial support. Marketing strategy via e-commerce site is adding value. Weakness: There is no skilled labour or carpenter. Using of reclaimed wood, may produces defected furniture. Human resource management of company is poor, due to lack of professional employees. Threats: Local furniture makers. Defected furniture could be an issue to the customers. There are many e-commerce sites, who deal with used and antique furniture at low price. Opportunity: They have excellent e-commerce site to attract their customers. The 5% discount on every reclaimed furniture. Use of reclaimed wood, help the environment from deforestation. The company also deal with luxury leather sofas. SWOT of Human Resource Management Strength The company has 25 operating franchise store to delivery their product. Weakness There is no skilled labour like carpenter or specialist. Threats Due to lack of skilled carpenters, the local furniture makers have huge benefits. Opportunity The company know their weakness, and they should hire some professional carpenters. SWOT of Finance and Accounting Strength The sales of company in last year were good and earned £ 3.3 million. Weakness They have no specialist who can take good financial decision for the company. Threats If the company only focus on profit then it would be their major drawback. Opportunity The company needs to invest other business unit like their luxury leather sofas. SWOT of Marketing Strength They have excellent e-commerce site for their business. The customers can buy their good or place their order via the site. Weakness The company still unable to utilize their e-commerce site for business. Threats Many e-commerce site deals with old or used furniture in low price. Opportunity The company needs to promote their business strategy and e-commerce site via social media. The company has enough strength to become potential leader of furniture industry. They have good marketing strategy, in where they display their products for selling and the buyers can choose their product and place order via online site. To prepare this e-commerce site company had invested a lot with unique features. The buyers can purchase the goods over this site. However, few people have idea about this company, and the company should promote their e-commerce via social media through which people can about this. Even the company has enough money and so they should do a unique thing to promote their business globally to attract more customers and allow some initial special discount of offers. However, the major weakness of the company is skilled labour, they are lacking professional carpenters, who re-modify the old goods or fixed the defected part of the furniture. So, HR department of the company should hire some professional workers who have capability to do this, and help to beat their competitors like IKEA. The company also should hire some professional trainers, who could train the old employees of the company. The company is also lacking a specialist to develop a good marketing strategy for the company’s benefit. The company should hire a specialist who having experience in this filed and help the company to get out through this problem. The company needs to develop some unique strategy in their all functional department so that the Raft can build a strong image into the market. b. Organisational Culture The organisation culture at RAFT is very flexible. The maverick approach which they follow in designing their furniture requires them to have a casual approach towards the organisation. Mick’s realises that his company will not be the next IKEA so he is ok with the fact that they do not have a strict corporate culture. Moreover his business strictly depends on online selling he does not need a strict corporate culture in his company as long as hi products are selling. So the factor which highlights the organisation culture of RIFT is the Maverick approach of doing business. This factor has the biggest influence on the organisational culture since it can showcase the way people work in the company. Question 4 a. Type of Customer Raft is dealing with reclaimed wood to make furniture, and there is might possible that the furniture may carry defects. Hence, the cost of wood for the furniture is very low than the fresh wood. Therefore, the furniture which made by the Raft is could be as sort type of used wood. So the Raft should target those customers who are willing to buy luxury furniture in fewer prices. There are many people who want to buy good looking furniture with high quality of wood and want to pay less amount of money. In Asia there are many nations whose economy is not stable and the population having low income and they also want to decorate their home with high quality wooden furniture to maintain status in society. These kinds of customers have less amount of budget to buy luxurious furniture for their use. So the Raft should target these customers more by providing them some special discount offers. Even the Raft can target organizations, offices, schools and universities, in these types of industries the demand of furniture is very high, and they also do not want to spend huge amount of money on buying furniture. The Raft should deal with these types of industries and can sell their furniture to them. To earn more profit, the Raft should target these types of customers by providing them high quality wood made furniture in low price. To do this the Raft should promote or marketing their business via social media or other kind advertising channels so they can get high number of customers. b. Societal Marketing and Green Marketing The term Societal Marketing has been in the limelight for quite some time now. The idea behind this concept is that a company makes a product or a service for the welfare of the community. In other words it is a kind of corporate social responsibility. The societal marketing idea calls upon advertisers to assemble social and moral contemplations into their marketing practices. They must adjust and juggle the regularly clashing criteria of company profits, purchaser need satisfaction, and open investment (McDonagh and Shultz, 2002). Yet various organizations have attained eminent deals and profit picks up by receiving and polishing the societal marketing idea. So when it comes to RAFT, they are basically using the woods that have been recovered from demolished houses in Indonesia. As we all know that due to the rise of global warming, we are constantly advised to save the trees. So RAFT has taken a positive initiative by using the recycled wood to make their furniture. Thus be doing so, they are not only contributing to the welfare of the nature but also helping society at large. So their business model can be said to be based on the concept of societal marketing. The customers will also be influences by such products are helping in decreasing the pollution level of the earth and also become aware about the rise of global warming. Green Marketing on the other hand which was made up due to the adverse effects of global warming. People, companies and the consumer are increasingly becoming conscious of staying in a nature friendly society. So the companies are also gradually shifting from the traditional marketing approach to a more nature friendly approach (Grant, 2007). The whole concept is known as Green marketing. This includes various aspects of marketing. Recently we have seen, how firms are concentrating on their corporate social responsibility approach, this is one way of making a statement that they are trying to be socially active rather than just trying to concentrate on the profits. Green marketing is also called eco-marketing. Companies are also trying to make an effort in manufacturing products that are less harmful to the nature. Companies like Toyota have already come up with vehicles which run on electricity and save of fuels. Similarly appliances are now a day’s becoming less harmful by removing the concept of CFC, which was considered very harmful for the nature. We also need to understand another important concept behind green marketing. Green marketing is essentially a positive approach towards marketing an environment friendly product or a service. It does not focus into maximizing the profits for a product but solely to have an eco-friendly approach to marketing. In the case of RAFT, they are in a way involved in green marketing due to the concept of recycled teak or better known as reclaimed wood. Thus with this idea, they are helping the motion of saving trees and using the old defective woods to prepare their furniture. By doing so they are manufacturing eco-friendly products which can be termed as green marketing. Their clients are aware of their approach and that helps them in selling their products effortlessly. c. Human Resource and Finance Issues Currently after going through the case, there are few issues that needs to be taken care of from the human resource point of view. Firstly, RAFT should come up with a dedicated team for human resource, who do all the necessary hiring of the employees, based on the companies requirement. The second issue that needs to be taken care of is that of the casual organisational structure. Although Mick does not take the organisational culture seriously, however, it is very essential for any organisation to lay down a set of rules and regulations for a company. The human resource team should come up with the set of organisational cultures and they should ensure that all the employees follow it properly. Doing so, will enhance the brand name further and generate even better sales. From the financial point of view, there are some issues which should be looked into by Mick. As mentioned in the case study. Since the company has been successful for 11 years at a stretch, the companys sensible next step would appear to be expansion by means of online channels, yet they are hesitant to turn to the web, wanting to construct a franchise arrange. Notwithstanding suspecting hes "forgetting a trap", Quinn happens to say: "I dont know the amount we can do with e-trade, yet it is a powerless spot (Hurley, 2011). Im utilizing a company that is fundamentally used to information, bookkeeping and frameworks administration to do it right now." So in order to do so, it is necessary that Quinn has his financials organised so that he can produce them to people who are willing to help him expand the company. Another issue that can be linked with the case of Raft is the fact that they plan to expand their company with the help of franchises. They have set out a target of 25 franchises so far, but have only been able to give out one franchise for their company. The problem out here might be due to the fact that Mick is not transparent with the franchise terms and conditions and need to financing might not have been mentioned clearly to the prospective buyers. Making things clear by giving all the necessary information will help in Raft’s expansion in a faster procedure. Question 5 a. Globalised Business Globalization is the procedure of worldwide mix emerging from the trade of world perspectives, items, plans, and different parts of culture. Propels in transportation and information transfers framework, including the ascent of the broadcast and the Internet, are main considerations in globalization, creating further reliance of economic and social exercises. The company buys the reclaimed wood from Indonesia and sales the furniture in London city. Since, the Raft is not yet globalized and need to be globalized. There are huge demands of reclaimed wood furniture in the world market, especially in nations of Asia, where the income level of the people is very low and they want to buy luxury furniture with high quality of wood. The reclaimed wood that the Raft is buying are teak wood which have high value into the market because of it quality (Guinness, 2003). Here, the Raft is using reclaimed teak wood which had been used by the people of Indonesia for building their houses. The price of reclaimed wood is less than the fresh teak wood, which helps the Raft to produce furniture in low price and can satisfy those customers of the world market, who want invest in luxury furniture but in low budget. The Raft is not a globalized organization, since the Raft only buying the wood from Indonesia and selling furniture in London city. However, it could be considered as globalized organization, since in exchange of wood the Raft is paying money, which is a form of globalization. The Raft should be globalized to increase their sales capacity, and to do this they need establish strong management who can deal the international market such as culture and languages. Even more the company need to setup a strong supply chain management to deliver the furniture in different location of the world. b. Drivers of Globalisation As we all know, there are four drivers of globalisation, cost, market, environment and competition. In the case of Raft, all the four are applicable. Raft has a unique concept of using reclaimed teak to manufacture furniture. Thus this concept helps them win over their competitors as they have a different orientation and outlook towards their clients. The next issue that should be highlighted is that of the cost. Reclaimed teak is easily available in abundances in the islands of Indonesia and so they are easy and cheap to purchase (Ghauri and Powell, 2008). However the furniture manufactured by them is pricey but their unique look makes them sell and they have a dedicated set of customers who are willing to pay the price for the furniture. The other driver which is the most important for them when it comes to globalisation is that of the market. The concept of selling reclaimed wood is gradually becoming popular across the globe and so their target market is increasing slowly. So if, they globalise, it will be highly beneficial for them, both from the view point of their profitability and the brand at large. Environment is also an important factor in globalisation and it should be ignored as well. When it comes to Raft, they will not face much problem in terms of the policies and licensing as they are planning to expand with the help of franchise. References Ghauri, P. and Powell, S. (2008). Globalisation. 1st ed. London: Dorling Kindersley. Grant, J. (2007). The green marketing manifesto. 1st ed. Chichester, England: John Wiley & Sons. Guinness, P. (2003). Globalisation. 1st ed. London: Hodder & Stoughton. Hurley, J. (2011). Raft sails to the suburbs with franchise plan - Telegraph. [online] Telegraph.co.uk. Available at: http://www.telegraph.co.uk/finance/businessclub/8952002/Raft-sails-to-the-suburbs-with-franchise-plan.html [Accessed 11 Sep. 2014]. McDonagh, P. and Shultz, C. (2002). Societal marketing in 2002 and beyond. 1st ed. Bradford, England: Emerald Group Pub. Read More