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Dirt Bikes Company Analysis

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Dirt Bikes USA Company Analysis By Brian Lucas Thomas Mattuchio Adrian Schul Table of Contents Company’s Culture and Goals…………………………………………………………. Products and Services Offered…………………………………………………………. Management and Employees…………………………………………………………… Dirt Bikes Sales Charts and Figures…………………………………………………… Marketing and Database Information………………………………………………… Analyzing the Total Cost of Ownership of Desktop Software………………………. Locating and Evaluating Suppliers Strategic Analysis: E-Commerce Analyzing the Impact of Component Price Changes Table of Charts and Figures

Dirt Bikes USA Organizational Chart……………………………………………………… Motorcycles Sold 2001-2005…………………………………………………………….. Sales by Model……………………………………………………………………………. Total Dirt Bikes Sales by Year………………………………………………………….

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. Total Yearly Sales Model……………………………………………………………….. Domestic vs. International Sales 2001-2005……………………………………………. Domestic vs. International Sales Figure……………………………………………….. Microsoft Office vs. Sun Star Office Figure………………………………………….. Microsoft Office TCO Figure………………………………………………………… Summary In this case analysis we will be looking at the company Dirt Bikes USA.

They manufacture and sell dirt bikes here in the US as well as around the world. The company was started in 1991 by Carl Schmidt and Steve McFadden. Their company houses over a hundred and twenty workers who are involved in the production, design, and engineering of the bikes.

They also house a twenty employee sales and administrative staff as well. Dirt Bikes currently produces’ four models of bikes (Enduro 250 Enduro 550 Moto300 and Moto 450) that are sold in the US as well as internationally. Their sales have been steadily climbing both internationally as well as domestically for the past five years.

We will analyze every aspect of Dirt Bikes while trying to come up with ideas of how to better the companies overall sales worldwide. Company’s Culture and Goals The company Dirt Bikes tries to maintain a culture that has a very friendly family atmosphere, encouraging teamwork, attention to detail, and quality, and continual learning with innovation. Their many employees, distributors, and retail customers are urged to contribute ideas on how to improve Dirt Bikes products as well as their services. This aspect I think is very good because it shows the company cares about what their employees think about their product and how to better it.

Products and Services Offered Dirt Bikes does not hesitate to use quality components from all over the world. The engines that are used for their bikes are Rotax engines from Austria and tires come from Dunlop, but many of their parts, such as shock absorbers, front wheel forks, exhaust pipes, and headlights, are from the United States. Dirt Bikes manufacture their own frames, shaping them to give it their unique spirited style for which the company is noted for. The company’s’ parts and service business, accounts for about 15% of their total revenue.

The manufacturing and selling of dirt bikes is a complex business. Dirt bike racing has many forms, including racing specifically for different size bikes, for short distance, long distance, and some bikes that can ride for up to six days straight. The Enduro bikes are made for cross country racing and motocross bikes are made specially designed for racing in an enclosed dirt course that can consist of a variety of terrains; uphill, downhill, corners, jumps, and so on. Dirt Bikes currently produces for models: the Enduro 250, Enduro 550, Moto 300, and the Moto 450.

The two Enduros are endurance racers, while the Motos are for motocross racing. All four are very modern, with such technology as kick and electric starters, steering stabilizers, and liquid cooling. The large majority of these bikes are sold here in the United States for between $3250 and $9000 dollars retail. (The Enduro 250 retails for $3250, the Enduro 550 retails for $7600, the Moto 300 retails for $4295, and lastly the Moto 450 retails for $8995) Dirt Bikes have appealed primarily to serious trail and endurance riders, although it is making inroads into the motocross market.

Management and Employees Dirt Bikes USA is still a privately owned company with Carl Schmidt serving as the CEO and Steven McFadden as President and Chief Operating Officer. There are about one hundred and twenty employees working in design, engineering, and production. Including three full time product designers and three engineers. In addition to a four people Parts Department, Dirt Bikes maintains a ten person service department to service warranties and customer related problems with parts and motorcycle performance. Five employees work in the Dirt Bikes shipping and receiving department.

The Dirt Bikes sales staff consists of a marketing manager and five sales representatives. Two for the West coast and Western United States, one for the Midwest, one for the Northeast, and one for the South. The corporate administrative staff consists of a controller, one accountant, one administrative assistant; two human resources staff members, three secretaries, and two information specialists to support systems servicing all of the business functional areas. Dirt Bikes USA Organization Chart Here is a chart of the hierarchy of positions at Dirt Bikes USA.

It starts with the CEO and COO at the top running the company. Followed by mid level players such as production, administration, also sales and marketing. The final levels are for worker position like parts, shipping and receiving, manufacturing, service, and design engineering. Dirt Bikes Sales Charts and Figures Sales Chart 1Motorcycles Sold 2001-2005 This chart represents how many US dollars each of the four Dirt Bikes sold between the years 2001 and 2005. The highest being the Enduro 550 and the lowest the Moto 450. Sales by Model 20012002200320042005 Enduro 25012011663229123122195

Enduro 55028323290375940783647 Moto 30017551932245426152627 Moto 450463598661773823 TOTAL62517483916597789292 Sales Figure 1 Sales by Model These numbers represent the total amount of US dollars that each of the four Dirt Bikes sold between the years 2001 and 2005 (Chart above). As you can see the Enduro 550 has been consistently their most sold product for the past few years. The most productive year for the company as a whole for sales was in 2004. Sales Chart 2 Total Dirt Bikes Sales by Year This chart represents the total amount of US sales by year starting in 2001 and ending in 2005.

As you can see there has been a steady rise in sales almost every year except the last two which seem to stay around the same area. Sales by Model 20012002200320042005 Enduro 25012011663229123122195 Enduro 55028323290375940783647 Moto 30017551932245426152627 Moto 450463598661773823 TOTAL62517483916597789292 Sales Figure 2 Total Yearly Sales Model These sales figures are for the total amount that Dirt Bikes have sold per year starting in 2001 and ending in 2005. Their best year has been 2004 with their worst being the first year 2001. The increase has been almost three thousand dollars in two years which is very promising.

Sales Chart 3 Domestic vs. International Sales 2001-2005 This chart gives a comparison of how much sales are between domestic and international for the years 2001 to 2005. You can see that the domestic sales are doing very well and climbing almost every year. Whereas the international sales are not doing quite as well and do not seem to be rising that much in these five years. Domestic vs. International Sales 20012002200320042005 Domestic57236843825488898530 International528640911889762 TOTAL62517483916597789292 % International8. 4%8. 6%9. 9%9. 1%8. 2% Sales Figure 3 Domestic vs. International Sales Figure

These figures relate to the chart above showing how domestic sales have been much higher than their international sales. Each product seems to go up almost yearly but the international numbers are far less impressive than those of domestic. This is an area they need to focus on more so they can improve international sales. Dirt Bikes best performing product the Enduro 550 and their worst selling product is the Moto 450. The proportion of Domestic sales is $5,195,000 dollars greater than International sales. International sales grew likewise with domestic sales, however it did not grow as much.

Sales (Revenue) are not growing steadily. In fact, the sales decreased from 2003 to 2005. The cost of goods sold is increasing whereas the sales are decreasing. The gross margin is decreasing and the net margin is increasing. The firms operating costs increase in 2004, then decrease in 2005. The company is in debt and do not have assets to pay for any more expenses. Marketing and Database Information The database that Dirt Bikes are currently using is not up to the standards that the company expects of it. The one they have now consists of basic information about each customer who buys a bike from them.

Dirt Bikes though wants to get more information on their customers so that they can pass it along to the marketing department for future ideas. The company does not need to make a completely new database they just have to add what it is they want to into the database. Dirt Bikes wants to know if their customers attend motocross shows, how many bikes they own, their age, years of schooling, and if the customer owns a non Dirt Bikes bike then who was it from. This information can be very valuable to the marketing department because it lets them now the average age of people who are buying their bikes so that they know who to advertise to.

That is how this database is helpful. An example is lists of customers who have purchased multiple bikes from the company are •Daniel Higgins 38 Ryder Rd Lincoln, Nebraska •Dwight Mann 23 Colby Ln Tacoma, Washington By knowing that these two are repeat customers Dirt Bikes is able to send them future notices on sales because they know that these two have purchased multiple bikes from the company and would probably purchase another if the deal was right. The marketing can take so much information from such a little database.

You could even take the state which the people are from and find out which state or region sells the most bikes. Then you could start to market heavier in that area. Once Dirt Bikes have the new database in place it should really help the marketing department which should help the overall of the company in the long run. There is so much good information you could use from these databases that I could not understand how it could not help the company make more profit. Analyzing the Total Cost of Ownership (TCO) of Desktop Software Assets Microsoft Office 2007 BusinessSun Star Office 8 (organizations) Price$499. 5 for each user (x8) = 3999. 60$90 for each user (x8) = $720. 00 Word ProcessingYesYes SpreadsheetYesYes databaseYesYes electronic presentationYesYes e-mail toolsYesNo webpage publishingYesNo Internet accessYesNo accounting softwareYesNo Figure 4 Microsoft Office vs. Sun Star Office Figure This figure shows the comparison between Microsoft and Sun Stars capabilities that can be used to help better their business. After analyzing both Microsoft Office 2007 Business and Sun Star Office for organizations it would be better in the long run to purchase Microsoft’s programs.

However, financially it is easily justified to purchase the Sun Star Office because of the significantly lower price. The downside of Sun Star Office is the compatibility between other Microsoft programs. Since Microsoft is so widely used by many other business’ it would benefit the company to use Microsoft. Also, the employees are most likely to be familiar with Microsoft’s product rather than Sun’s. Another downside is that Sun does not offer as many programs in their package as Microsoft and Dirt Bikes requested to have e-mail tools and webpage publishing.

Overall, if Dirt Bikes could afford the Microsoft software I recommend purchasing it, if not, purchase the Sun Star Office. TCO Microsoft Office $499. 95 $25 per user one time training $10030% of intial purchase costannual downtime %15 of purchase cost 524. 95624. 95149. 98574. 9925 TotalTotal 3 years 849. 9275$2549. 79 Figure 5 Microsoft Office TCO Figure Locating and Evaluating Suppliers When looking into Dirt Bikes it was discovered that they were losing money because of delays caused by components not being shipped in on time. When looking for a new vendor to supply fuel tanks I found two that I thought were the best.

The first was BikeBandit on their site they have almost every part including tanks for almost any bike. That part alone almost convinced me but when going through their order process I found it tedious and at times confusing with the number instead of bike name. So the second site I went to was Just Gas Tanks. They had a very wide range of tanks for both road and sport bikes that are needed for this company. Their order process was unbelievably easy and the part that sold me was that all part orders over $150 come with free shipping.

That can save a company a lot of money in the long run. The issue that Dirt Bikes have is that they are interested in if there is any supply chain management software out there that can help better their company. I ended up with the two I thought could help the company the most. They are the Manhattan Associates and LLamasoft. I felt that both had excellent products and seemed to be both highly regarded in their respective fields but LLamasoft won me over because of not only the qualities I mentioned before but had easy to understand website that was strait to the point.

It gave me a great overview of who they were and what they offered without confusing me. The home page had the number for both technical and general business support which I believe is a strong case that they must have an excellent customer service team. This seems like the right service to help the companies supply chain management so that we can grow more internationally as well as more domestically sales wise. Strategic Analysis: E-Commerce The idea of Dirt Bikes promoting and selling their products through the internet could really do nothing but help them.

It will give them more exposure to a wider audience of people who might not have known this shop because of where they are in the country. Now you are able to take orders from people around the world which means your international sales should rise a little more because of this and the domestic sales as well because of the same reason that more people will know about your product. I don’t believe you make the internet your only place for promotion. You still should keep your advertising in magazines and papers because it was working before so why go get rid of something that wasn’t hurting you.

Dirt Bikes just need to add internet promotion to what they already do so they can reach a larger mass audience. There should not be a website for their customer service only because some people do not use computers and would not be able to take advantage of your customer service line which in the end could cost the company a customer. The average web site cost is about around twenty five thousand to maintain a year. Now this keeps you up to date on all the latest protections and such for the website.

If a web site was created it needs to have customer service right there on the front page and an option for different languages because if you want to make money you have to expand with the internet which any country can access so a website offered in different languages is crucial. Analyzing the Impact of Component Price Changes 1. The two right columns complete the bill of materials. The extended cost of each component and total materials cost for the brake system. Bill of Materials: Moto 300 Brake System

ComponentComponent No. SourceUnit CostQuantityExtended CostTotal Materials Cost Brake cableM0593Nissin27. 81127. 81657. 64 Brake pedalM0546Harrison Billet6. 03212. 06 Brake padM3203Russell27. 05254. 10 Front brake pumpM0959Brembo66. 05166. 05 Rear brake pumpM4739Brembo54. 00154. 00 Front brake caliperM5930Nissin104. 001104. 00 Rear brake caliperM7942Nissin106. 781106. 78 Front brake discM3920Russell143. 801143. 80 Rear brake discM0588Russell56. 42156. 42 Brake pipeM0943Harrison Billet30. 00130. 00

Brake lever coverM1059Brembo2. 6212. 62 2. This table is an analysis of the impact on the total brake system materials cost if the front brake calipers unit cost ranges from $103-$107 and if the brake pipe cost ranges from $27-$30. Brake pipe price variable Front brake caliper price variable$27. 00$28. 00$29. 00$30. 00 $103. 00653. 64654. 64655. 64656. 64 $104. 00654. 64655. 64656. 64657. 64 $105. 00655. 64656. 64657. 64658. 64 $106. 00656. 64657. 64658. 64659. 64 $107. 00657. 64658. 64659. 64660. 64

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Dirt Bikes Company Analysis. (2018, Mar 23). Retrieved from https://graduateway.com/dirt-bikes-company-analysis-essay/

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