ECCO A/S – GLOBAL VALUE CHAIN MANAGEMENT | |
Report submitted by:Abhas Mangal (GAPR11IT038) | |
Executive Summary 3
Company’s Profile 4
PORTER’S FIVE FORCES STRATEGIC ANALYSIS 5
Outcomes of Porter’s Five Forces 5
SWOT ANALYSIS 6
Evaluation of Alternatives 6
Recommended Strategy 7
ECCO, a global manufacturer and a supplier of shoe products, wants to expand into the Chinese market to increase its export to major markets and also increase product sales among Chinese consumers. But many Chinese manufacturers imitated the product design and features of ECCO increasing the intense competition for the company in the Chinese market. Also, ECCO for years has a sole focus on increasing the quality of the shoes manufactured by using its sophisticated in-house “direct injection” technology. But the company cannot only thrive on its quality unless the company’s efforts to ensure quality are not communicated to the consumers. Thus, the company focused less on marketing operations that is evident from its low marketing budgets as compared to its competitors.
Also, the most of the products manufactured in four production facilities outside Denmark were distributed through its distribution centre in Tonder, Denmark where only six to nine percent of total production was actually sold. Thus, ECCO became inefficient to fulfil the replenishment orders that had to be delivered within a few days notice. Thus, the main challenge for ECCO is to focus more on the marketing operations of its products & remove the inefficiencies in its in-house “cow to shoe” value chain that converts the raw hides procured to the finished goods.
ECCO has various options to overcome the challenges and significantly increase the market share in Chinese geography. One option can be to hire a marketing agency to increase its marketing operations in China...