What Does Conair Corporation Have to Do to Continue to Get Profit - Coursework Example

What Does Conair Corporation Have To Do To Continue To Get Profit? Table of Contents Terms of Reference 3 2. Procedure 3 3. Findings 3 3 MarketAnalysis 3 3.2. Analysis of Competition in the Portable Electronics Industry 4 3.3. SWOT Analysis 5 3.3.1. Strengths 5 3.3.2. Weaknesses 6 3.3.3. Opportunities 6 3.3.4. Threats 6 4. Conclusion 6 5. Recommendations 7 6. References 8 7.1 Work Plan 10 7.2. Figure 1: Share of Consumer Electronics Sales in Total US. E-retail from 2010 to 2016 11 7.3. Figure 3: SG&A Cost Versus Gross Profit In 2012 In Global Consumer Electronics Industry 12 1. Terms of Reference Conair Corporation is a US based multinational company, which is involve in designing, manufacturing and marketing beauty and health care products and small electronic accessories. The corporation is also recognised as one of the leading brands in cookware and small kitchen accessories. In the current highly volatile market environment, organisations such as Conair and others faced significant challenges of sustaining business profitably due to increased competition and changing customers’ needs and preferences. Against this backdrop, a report is intended to be prepared for the company. Accordingly, this report intends to analysis the various factors affecting the business operations of Conair and make relevant recommendations for the company to sustain its business with continuous profit. 2. Procedure In order to prepare the report and to ensure the reliability of the recommendations, data relevant to the report are collected from secondary sources. Accordingly, the secondary source data includes online websites, lately published business reports, journals and articles. 3. Findings 3.1. Market Analysis In the recent years, the US electronics market has experienced severe fluctuation due to numerous reasons. In this regard, one of the most prominent factors is related to the slow economic growth as a consequence of financial crisis. Not only, the US but also the global business environment has been ascertained to be adversely influenced by the sluggish economic growth. The impact of sluggish economic growth has been determined to have direct influence on the ability of customers to invest on health, beauty and small kitchen appliances. Moreover, continuous innovation in the field of technology has been also ascertained to have a profound impact on the consumers’ preferences and willingness to purchase electronic appliances. In other words, the changing environment pertaining to consumers’ electronics market has reshaped certain imperative factors, which has assisted different organisations like Conair to deal with several challenges across multiple fonts. The debilitating price wars, emergence of online retail and competitors strategies to attract the customers have been determined to have considerable impact on the ability of business organisations such as Conair to attain profit constantly. In addition, the operational cost associated with the daily functioning of business organisations has also been ascertained to increase in the recent years particularly due to the soaring cost of raw materials. The increasing operational cost has been identified to have radical influence on the profit margin of the companies in the portable electronic industry. It has been identified that the consumers are currently price sensitive and are involved in the purchase of relatively cheaper products. The price of many electronics products has also been determined to decline in the recent years, which have further reduced the ability of the companies in the portable electronic industry to earn substantial profit on a regular basis. The declining sales of the product have been also identified to create considerable pressure on the companies like Conair to generate profit continuously. Correspondingly, the quest of improving the financial performance of the companies have resulted the companies in the portable electronics industry to formulate several new strategies and innovate products that are hard to imitate by the competitors while meeting the customers’ expectations at the same time (Cognizant, 2011). 3.2. Analysis of Competition in the Portable Electronics Industry The phenomenon of globalisation has resulted in the reduced barrier entry for new ventures in the global market place. Hence, in the present global portable electronics industry, both large and medium enterprises are identified to be competing with each other in order to create demand for its products and/or services. Notably, the current globalized market place is characterised by increased pressure from competitors including both local and international players. In the present fast pace business environment, almost all companies are involved in strengthening its core competencies for sustaining increased competitive tractions as well as to generate substantial profit (Kim, 2007). In addition, the rapid growth of e-commerce has facilitated small enterprises to penetrate large market at minimum costs, which has further increased the level of competition in the portable electronics industry. Numerous enterprises both at that national and international level are involved in taking the advantages offered by the growing trend of e-commerce. In addition, the use of internet has been further ascertained as a major driving factor behind the increasing popularity of online shopping. Correspondingly, the level of competition has been determined to be continuously intensifying in the global portable electronics industry. Currently, more and more companies have established research and development units across different parts of the world to ensure innovation in its business process, so that better innovative products and/or services are developed effectively. Correspondingly, such strategies of the companies in the portable electronics industry have dramatic influence on the competitiveness of the firms like Conair. It is worth mentioning in this regard that the consumer electronics are primarily driven by their enthusiasms. Hence, companies in the portable electronics industry are constantly involved in tapping the consumers purchasing behaviour for determining the most suitable strategies to attract their attention and increase the demand of its products (CEA, 2014). Despite these trends, it has been observed that Conair has been able to deal with the challenges restricting the overall efficiency of the companies operating in the portable electronics industry. The employees within the company are identified to be highly motivated and talented who are constantly engaged in contributing towards the growth and expansion of the company. The company under the leadership of Larry Doyle has been able to meet the diverse needs of customers efficiently, which has facilitated it to succeed effectively in the current tough market condition (The Conair Group, 2014). 3.3. SWOT Analysis 3.3.1. Strengths The major strength of the company is its global operation. The company operates in many countries with its headquarters located in Canada, Hong Kong, Mexico, Europe, and other countries. Besides, the highly talented employees and the team of experts involved in the daily operation of the company also allow it to differentiate itself from other competing firms. Leaders of the company are also identified to regularly engage in formulating broad strategies, which has facilitated the company to overcome the challenges of changing business environment over the years. In addition, the company is also involved in modifying its product line constantly in order to ensure its product portfolio innovative, which further enables it to meet the potential needs of the customers more efficiently. 3.3.2. Weaknesses It has been observed that there are no major weaknesses associated with the company. However, inability of the company to resist the changes in the economic condition may negatively influence its core competencies. 3.3.3. Opportunities The rapidly growing consumer electronics market can be identified as one of the potential opportunities for the company in the later years. Accordingly, the customers in the present era are more concerned about their health, life style, and beauty, which can be further anticipated to positively influence the profit earning capacity of the company. In addition, the consumer electronics market is also identified to grow at a rapid pace in developing countries such as India and China, which can be further projected to contribute towards the increasing revenue earning capacity of the company. 3.3.4. Threats The sluggish economic growth can be determined as the potential threat for the company that may hinder the ability of the company to generate considerable revenue. In addition, the increasing competition as a result of globalisation can also be reckoned as another vital threat that may unfavourably influence the operations of the company in the international market. 4. Conclusion It has been observed from the foregoing discussion that Conair Corporation has a global presence and is involved in designing, marketing and manufacturing personal care electronics appliances as well as healthcare products. In the recent years, the portable electronics industry has witnessed significant changes, which has reshaped many prominent factors within the industry. At the same time, the level of competition is ascertained to be increasing rapidly due to the phenomenon of globalisation. Although, the company over the years has been able to sustain its position as one of the leading players in the global portable electronics industry but with the rapidly growing e-commerce sector along with intensifying competition is ascertained to pose serious challenges particularly to its ability to generate substantial profit on a continuous basis. Hence, it is essential for the company to devise strategies and measures to successfully overcome the challenges in order to ensure constant flow of profit. 5. Recommendations It has been observed that the current portable electronics industry is highly competitive. Thus, it is essential for the company to devise strategies that would differentiate it from the competitors operating in the same market. In addition, the current customers are also identified to become highly price sensitive; hence, the company should develop innovative products and offer the same to the customers at reasonable price without compromising the quality of the products (Cognizant, 2011). Since, the company operates in different countries of the world having different culture, it should not heavily rely on universal business strategies rather it should implement strategies based on the prevailing situation and environment. The company should also ensure that an organisational culture of respect and harmony is placed within the company in order to ensure that its employees are motivated to contribute their best for the accomplishment of the broad organisational goals and objectives (Cognizant, 2011). 6. References AlixPartners, LLP, 2014. A Tale of Two Tiers. The 2014 Global Consumer Electronics Outlook. [Online] Available at: http://www.alixpartners.com/en/Publications/AllArticles/tabid/635/articleType/ArticleView/articleId/822/A-Tale-of-Two-Tiers.aspx#sthash.BwUedOLd.dpbs http://www.cognizant.com/InsightsWhitepapers/Understanding-US-Consumer-Electronics-Retailing.pdf [Accessed October 28, 2014]. Cognizant, 2011. Understanding U.S. Consumer Electronics Retailing. The Market Landscape. [Online] Available at: http://www.cognizant.com/InsightsWhitepapers/Understanding-US-Consumer-Electronics-Retailing.pdf [Accessed October 28, 2014]. CEA, 2014. Global Consumer Technology Trends: Cross Market Briefing. Technology Propensity. Introduction. [Online] Available at: http://www.ce.org/CorporateSite/media/Research-Media/Report-GlobalConsumerTechnologyTrends-CrossMarketBriefing.pdf [Accessed October 28, 2014]. Kim, R., 2007. Samsung’s Competitive Innovation and Strategic Intent for Global Expansion. Problems and Perspectives in Management, Vol. 5, Iss. 5, pp. 131-137. Statista Inc. 2014. Price and Access. The Statistics Portal. [Online] Available at: http://www.statista.com/statistics/278891/share-of-consumer-electronics-sales-in-total-us-e-retail-sales/ [Accessed October 28, 2014]. The Conair Group, 2014. Industries Served. Industrial. [Online] Available at: http://www.conairgroup.com/industries-served/industrial/ [Accessed October 28, 2014]. Vault.com Inc, 2014. Conair Corporation. Strategy. [Online] Available at: http://www.vault.com/company-profiles/general-consumer-products/conair-corporation/company-overview.aspx [Accessed October 28, 2014]. Varano, M., 2012. Advertising Principles: Conair. Prezi Inc. [Online] Available at: http://prezi.com/fh4qxokxzy8g/advertising-principles-conair/ [Accessed October 28, 2014]. 7. Appendix 7.1 Work Plan Statement of Problem In the globalized era, business organisations are constantly faced with numerous challenges and difficulties. In this regard, Conair Corporation, which a US based multinational company has been ascertained to face issue relating to declining profit margin in the recent years. Statement of the Purpose, Including Expansion And Restrictions The purpose of this report was to conduct an analysis of various factors influencing the overall business operations as well as growth and expansion of Conair. Besides, the report also intended to develop reliable recommendations for the company regarding sustaining continuous profit. Research Strategy In order to develop reliable recommendations, extensive research work was conducted. Accordingly, secondary source of data, including journals, official website of the company and business reports relevant to the subject matter were reviewed to acquire data for the same. 7.2. Figure 1: Share of Consumer Electronics Sales in Total US. E-retail from 2010 to 2016 (Statista Inc. 2014.) 7.3. Figure 3: SG&A Cost Versus Gross Profit In 2012 In Global Consumer Electronics Industry Source: (AlixPartners, LLP, 2014) Read More