Situation Analysis Report
To Andrews C54976 Board of Directors, This objective of this report is to explain our company’s strategy, how effective we were in achieving the company’s goals, and what changes we will make to the company’s strategy to improve future operations. Also, this analysis will focus on what competitive and financial factors affected our company’s strategic goals. Strategy: Andrews Company implemented a broad cost leader strategy.
Our intended goal was to maintain a presence in all segments, keep costs to minimum and offer a below average price for our products. By keeping costs such as R&D, material and production, our company should be able to maintain a competive advantage because of our ability to offer a lower price. Although we want to maintain a presence in all segments, the traditional and low- end products benefit the most from this strategy since the customer preference is the price range.
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More specifically, Andrews focused on the following area to stimulate growth: * Avoiding emergency loans * Paying off debt to maintain a good credit in order to finance growth * Focus heavily on the Low-end segment due to the customers preference * Limit expensive investments(R&D, capacity, automation) to ensure lower prices * Lower material & labor costs with TQM * High accessibility for our products Maintain 75% awareness in each segment to stimulate unit sales * Be risk adverse Effectiveness of our stategy: Appendix A shows the profits of Andrews from 2013-2021 and the growth of our stock price over the years. As you can see Andrews have effectively increased profits stock price which in turn fueled our stock price as you can see the identical relationship in growth.