Crest Nicholas Real Estate Company - Case Study Example

Crest (N) case analysis s Affiliation This paper presents a case analysis in business with regard to Crest (N). The paper is structured in sections as shown below: A. Situational Assessment Crest Nicholas is a real estate company that focuses on building and designing new homes for the past 50 years. It considers the local designs and provides better homes, leisure places, retail and work places thereby creating a developed and sustainable community. Doing business is such an environment attracts competition. As such, the industry is very competitive in the sense that Real estate experts are transforming the way business is done: Primary competitors such as Foxtons , Eliason, and Harley Stanfield are offering prospective buyers an opportunity to view exhaustive property listings online and they are using websites and internet to get leads to potential clients. The competitors are changing their “menu” of offered services. a) Government involvement Legislative, executive and judicial arm of government can influence how business in done in real estate. Through legislative arm, the government can draft laws with can have great effect on property pricing and on the other hand influence the demand. Taxation on mortgages and deductions are some of the ways that an existing government laws can increase the demand for real estate provided that it continues to legislate laws that suit this industry. Knowing the current laws that affect property sales can significantly help buyers and house owners plan for their intended actions. Through the judiciary, can help punish the offenders of such laws as a way of enforcing the laws. The executive arm of regime can also offer subsidies that low the operational cost of businesses as a way of encouraging private investment. b) Economic factor On a general perspective when the economic growth is sluggish, business in real estate industry will be sluggish as well. One major factor that definitely affects the prices in real estate is the health of the economy having in mind indicators such as GDP, prices of houses, the level of house use (consumption), manufacturing activity and even employment data. Take for example the leasing of a building that should be used as a hotel. When the economy is down that means an acute shortage of customers thereby loosing on the leasing side of the building. Looking at it on another angle office tenants take longer leasing terms and when an economic turmoil occurs these tenants take the full heat of the situation. Awareness on the economic cycle is thus important for either short or long term leasing and even actual purchase of a property. c) Social Aspect Indicators of social effect on real estate include majorly population growth, cultural aspect and age distribution. These three social factors are a significant indicator in real estate given the fact that putting a real estate firm in a place that is residence to an aging population will automatically mean less or no business at all. This is a population had probably bought their own houses. d) Technology Aspect Technological changes can adversely affect cost, quality and propel innovation. Take the case of Crest N, this is a firm that should keep abreast with technology in consideration of the ever changing techniques of house building and designs. e) Natural factor Natural disasters, land scape, general weather patterns are a great consideration in the real estate industry. The ever increasing awareness of the current weather patterns helps clients and real estate companies know where to invest. Landscape consideration is another factor that either impacts negatively or positively real estate location and investment. B. SWOT analysis A random SWOT analysis on Crest N definitely noted the company’s strength, weaknesses, threat and opportunities as follows: i. Strength The company`s strength lies in its ability to embraces change and always be abreast with technology. This aspect makes the firm a threat and a step ahead of the competitors who neglect any of these. For the firm to be efficacious in the prevailing environment, it is definite that its other strengths is having 10% market share. ii. Weaknesses Inadequate human resources in the organization is the weakness that most company owners realize they face when a SWOT analysis is done. In our case, the company has limited human resources: a small staff that makes it hard to tackle every need in the firms to-do list. Moreover, part of the available staffs lacks the necessary skills and training needed to perform needed tasks. This is a limitation in the organization. In most cases the firm has to hire experts and consultant when launching technical activities. iii. Opportunity Prevailing global economic integration presents opportunities in real estate investment, particularly at international level. This fact is more appealing to the firm than ever before. Given the weakness and sluggish growth in the local real estate markets for many developed economies, global economic integration is indeed an opportunity to make more profit in the industry. Although customary global capital flows were mainly directed toward America and Western European, in previous several years, considerable interest has emerged in Asian markets. More recently, real estate investment is on the rise in Latin America, Russia, and Eastern Europe. Even though most capital presently going into global real estate has been having an “opportunistic” risk structure, “value-added” or even “core” strategies are expected to come parallel as global real estate grows. Decline in portfolio risk is also expected to become more attainable. iv. Threats One potential threat to the above opportunity and strengths is in form of intense competition. Demand in real estate is anchored on interest rates, population growth, employment rates, personal income, and also access to capital. Competition level affects the profitability of the companies, its property values and even its demand. C. Problem statement This section outline what the primary problem could be. The biggest problem in the business is on branding and reputation. The firm needs to have competition which may have superior branding and improved reputation than before. D. Alternatives The following alternative can be done improve on the identified problem: a) Establish a customer-centric environment. Great customer service is paramount. b) Encourage customers to give and share their opinions and thoughts regarding the products and services the firm offers. c) The company should make it easy and simply for clients to leave their review or comments. d) The company should also make mandatory to respond to these comments – negative or positive. Customers are at times inspired to spread messages regarding a brand if only they get a positive experience. E. Evaluation The best performance evaluations is about creating the urge in clients by analyzing responses after which targets are set and then availing resources. An employee invests in his or her employer if the latter does the same. If customers are not writing flattering comments and reviews about the firm then the firm is doing well in responding to clients opinions. The amount of reviews will also signify how easy it is for clients to leave their reviews and how encouraged they are to leave the comments. With all these, the firm`s brand image and reputation will be on the rise. F. Analysis of the Alternatives The merits of alternative (a) is that it assist the firm in establishing a workable competitive advantage over the competitors. However, the cons will be that it will increase the operational cost of the firm. The pros of alternative (b) is that customers will feel part of the business and so identify with the business. As such, the firm does not require much advertisement as people shall have identified with the firm. The demerit is that the alternative can bring unwanted or personal issues into the business. The benefit of alternative (c) and (d) is that the current status of the firm`s brand image and reputation can always be gauged. However, in certain cases the some clients will not reveal their genuine opinion just to impress or encourage the firm in its endeavors. Therefore, as a drawback, the alternative might not be the best. G. Recommendation I will recommend all the alternatives as they run together as far as solving the primary problem is concerned. H. Action plan Any business needs an exquisite plan to put any venture into action. The top managers are entirely responsible for the day to day running of the business. They are entirely responsible for three major aspects; branding, reputation and marketing Strategy. Setting realistic goals is the most important step in setting up an action plan. This includes stating the firm`s reachable goals, arranging these goals in order of urgency and priority, giving these goals a realistic timeframe. How many clients in the case of Crest are reachable in the next 2, 4, or 5 months for example? Has the marketing team achieved its number of target audience and so on? I. Contingency plan Running any business especially real estate firms has its own risks. This is because there is no guarantee that this particular venture (the above action plan) will automatically be profitable. Unforeseen happenings such as change of market landscape and so on are some of the ways that can make any business cut normal proceedings thus the need of a plan B also known as contingency plan. Coming up with a contingency plan would involve steps like; first having a team that is always ready for disasters and having the technical know-how of handling such, Reviewing data backup and storage methods, ensnaring there is an emergency recovery department and most importantly involving workers in the planning process. In the case of Crest N employee involvement is of the essence this helps know the market change. References Peiser, R. B., & Hamilton, D. (2012). Professional real estate development: The ULI guide to the business. Washington, DC: Urban Land Institute. Read More