The scene is similar to what happened with P&G and Wal-Mart where P&G denied adhering to Wal-Marts demands of producing products according to Wal-Marts specification. This resulted in Wal-Mart taking out all the P&G products off its shelves and P&G profits reduced by around 20%. P&G had no choice but accept Wal-marts demands and produce according to their specification. The similar situation could be faced by HLL from these emerging big players in the market. Formulate HLL,s distribution strategy to overcome dominance form players such as Bigbazzar, Reliance, Wal-Mart,etc. Consider this as a case scenario and that you are the CEO of HLL. Formulate a strategy so as to avoid becoming a puppet in the hands of these players.
2006-09-12 22:16:58 · 4 answers · asked by Anonymous in Business & Finance ➔ Corporations
Formulate partnerships with a web based business with a good track record of success to give you an alternative customer base and give them approx. half of your advertising budget to recompenste their distributors or partners. That way if anyone else threatens to kick you out you already have a solid income base without being dependant on them. And the Web portal will always come back to you.
2006-09-12 22:24:02 · answer #1 · answered by Old Wise One 3 · 0⤊ 0⤋
Before I devise a plan, I would evaluate how the change would effect the company. Would the amount of volume sold to the "big boys" increase profitablity enough to justify the cost of producing client specific product? What efffect of not producing the client specific product do to my business? (Will they stop using my product all together?) Is there room for future growth with that company? Will producing the client specific product open the door for revenue generated for with other companies? (For example, could this be used as a selling point to gain new business?) What are the options of using a supply chain solution? Can the company increase the price for their service, outsource the work for a lesser fee, and not have to worry about the hassle? What will the cost of the modification be? (Training employees, additional space and equipment needed.)
After I have completed the evaluation and looked at the option from all perspectives, I would create a plan based on what would achieve the best results for my company.
2006-09-13 16:21:55 · answer #2 · answered by Mariposa 7 · 0⤊ 0⤋
the only way HLL can avoid this situation is to make its products to meets it's customer's satisfaction(the final customers). Make sure what ever promotion you do contains a little part about wal mart increase your productivity quality level so that wal mart can't demand anything from you as their profit level is now depend on you.
but it is advisible if their specifications match customer's need to follow them.other wise develop the market before you enter into wal mart's market
2006-09-12 22:48:28 · answer #3 · answered by TheHacker 4 · 0⤊ 0⤋
The solution is to change the specs and give them what they want. It's a no brainer. P&G spends millions trying to determine what the consumers want - now Wal Mart is giving them that info.
Anything else is hubris at the expense of the shareholders.
2006-09-12 22:31:46 · answer #4 · answered by nicomp 4 · 1⤊ 0⤋