This instance analysis will concentrate on the issues surround the lifestyle merchandise company Holey Soles. Psychologist Ann Rosenberg founded the company in September 2002. She ab initio operated in her garage and backyard. until she recruited Joyce Groote ( now current CEO of Holey Soles ) and expanded the company into other parts of North America. Holey Soles focuses on making advanced footwear made from their trademarked engineering SmartCel and SoleTek. which is an injection-molded froth engineering.
As of July 2007. gross revenues had grown at 300 % in each of the last two old ages and the company was ranked figure four in the 2006 Profit magazine ranking of Canada’s Emerging Growth Companies. However as they continue to run. they find themselves acquiring pushed back by their figure one rival. Crocs. By mid-2007. Crocs gross revenues were 33 times the gross revenues of Holey Soles. Holey Soles has a gross mark of $ 40 million by 2009. and to accomplish this mark. they will necessitate to concentrate on the issues environing their company and impeding its growing. We have decided that the nucleus issue surround the company is how to make the end of $ 40 million.
They need to turn to the possible options of either spread outing into other merchandises besides footwear. implementing a more aggressive selling scheme. altering their 2-year ends wholly. or keeping the position quo. These options will depend on the appraisal of the clip frame. cost. and current and possible competition. Upon analysing all state of affairss and options. we have decided that the best solution for Holey Soles would be to spread out the company by making other merchandise lines made form their trademarked engineering. Merely through this method will they be able to bring forth adequate gross to run into their $ 40 million end.
Issues The issues environing Holey Soles include the inability to hold a high market portion due to dominance from Crocs. how to make the end of $ 40 million gross. and make up one’s minding upon enlargement. We think the nucleus issue is how to make the end of $ 40 million. Decision Criteria
1. Time frame of execution: They merely have 2 old ages to do make their intended end of $ 40 million. Sing the high mark figure. 2 old ages is a really short clip frame. and hence is an of import determination standard. Sourcing from China to other parts of the universe besides takes a long clip. so it factors in how much merchandise can really be made in the clip frame given. 2. Cost of enlargement: To make a end of $ 40 million. an enlargement of the company would hold to take topographic point. This poses the job of where capital is traveling to come from. 3. Current competition: Their figure one rival is Crocs. During the 2-year period to make a end of $ 40 million. Crocs will still be selling at the rate they have been. and may besides be working towards ends of enlargement. 4. Menace of possible competition: In the 2 twelvemonth clip frame given. what’s to state that new rivals will non come in the market? As the geta craze continues. more companies are bring forthing similar merchandises as Holey Soles. Even though most of them aside from Crocs have a poorer design with lower quality stuffs. the possibility of a company all of a sudden come ining with a whole new engineering is ever possible.
Alternatives & A ; Appraisals
1. Expand by increasing a more diverse scope of merchandises sold. By trusting on selling the getas entirely. they will ne’er be able to make their end of $ 40 million. nor be able to catch Crocs since Crocs has taken so much more of the market portion already. With their trademarked foam-injection engineerings SmartCel and SoleTek. they should set those towards making newer and more advanced life style merchandises aside from footwear. They already started with the beach bag. so it proves that it is possible to make other merchandises. They already have an advantage due to their company being defined as merchandises that are “lifestyle” centered. instead than merely a “footwear manufacturer” .