...Introduction Harley-Davidson, Inc. was established and entered the motorcycle industry in 1903. The company has primarily focused its resources on the heavyweight motorcycle segment of the industry and is differentiated from its competitors because its focus is only on the motorcycle industry as opposed to other transportation markets such as: cars, boats, ATVs or snowmobiles. The company has experienced both the “good and bad times.” The company was founded by several young men in 1903, was bought out by AMF, experienced a leveraged buyout and ultimately became incorporated with its IPO in 1986. In addition to a constantly changing ownership structure, Harley-Davidson has also experienced significant issues with quality control, inconsistent management and a reputation for being associated with tattoos and pornography. By 1998, the company resolved its quality and image concerns, gained financial stability but continued to face supply concerns and threats of competition by new entrants and possible product substitutes. The challenge facing current Harley-Davidson management is how to combine the company’s approach in marketing the Harley image with consistent financial stability and increasing market share to outperform the competition. Industry Overview Harley-Davidson competes against other American and several internationally based companies within the motorcycle industry. Harley-Davidson has focused...
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...Case Study: Harley-Davidson -Analyse Harley-Davidson resources and capabilities, and identify its key strengths and weaknesses - Analyse the international competitive environment in which Harley-Davidson is operating to identify its main threats and opportunities. Recommend a forward strategy for Harley-Davidson, which addresses these issues. International Management Individual Assignment Table of Contents 1. Introduction 3 2. Harley Davidson Overview 4 2.1. Harley-Davidson Current Strategy 4 2.2. Resources And Capabilities 5 3. Industry Analysis 6 3.1. Porter’s Five Forces Model 6 3.2. International Competitive Environment 7 4. SWOT Analysis 9 5. Forward strategy recommendation for Harley-Davidson 10 6. Conclusions 12 6. References 13 1. Introduction This report is based on Harley-Davidson, Inc., case study. The aim of this report is to analyse industry and international competitive environment where Harley-Davidson is operating in. One must apply and fully analyse theoretical concepts and frameworks in order to fully comprehend how Harley-Davidson is differentiate itself in the international competitive environment and what strategies is using to achieve higher market share. The empirical material is being analysed by exploring the general information of Harley-Davidson company itself, following by the industry and competitive environment analysis, review of SWOT theoretical framework. Finalising with the recommendations of forward...
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...Strategic Report for Harley Davidson April 4, 2006 1 Table of Contents Executive Summary ………………………………………………………… 3 Company History ……………………………………………………………. 4 Five Forces Analysis Internal Rivalry ………………………………………………………. 8 Entry …………………………………………………………………….. 9 Substitutes and Complements …………………………………. 9 Supplier and Buyer Power ………………………………………. 10 Financial Analysis ………………………………………………………….. 11 Strategic Issues and Recommendations ………………………….. 17 2 Executive Summary Harley Davidson remains a financially strong and stable company. During 2005 the company reported the 19th consecutive year of record revenues and record earnings. While Harley Davidson’s growth has slowed over the past several years the decline in growth rates are primarily attributable to a maturing market, which results in lower growth rates for all member of the motorcycle sub-industry. During 2006 Standard and Poor’s predicts that the motorcycle sub-industry will grow between 1% and 3%, a much slower rate than the double digit annual gains the sector saw throughout the 90’s and late 80’s. Despite the company’s strong financial outlook the stock price has not been performing well over the past year. The stock price fell dramatically in April 2005 when Harley Davidson management lowered guidance of new motorcycle shipments to the network of independent dealers. Wall Street analysts proceeded to predict doom for the company as it appeared that it would be unable to continue its...
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...------------------------------------------------- Harley-Davidson Question 1: What are Harley-Davidson’s current sources of competitive advantage? The challenge for a marketing strategy is to achieve sustainable competitive advantage. A competitive advantage is an advantage over competitors gained by offering consumers greater value, either by means of lower prices or by providing greater benefits and services that justify higher prices. At present, Harley-Davidson has a number of sources of competitive advantage. 1. Brand image: Since its inception, Harley-Davidson established an image of “raw power”, which became its major selling point. Throughout its history, Harley motorcycles were associated with people who were willing to break the traditional mold or willing to live on the edge. Its brand image reflected rugged individuality and the frontier spirit of the United States. This strong sense of nationalism connected to Harley motorcycles resulted in brand recognition and loyalty that continues to this day. Harley’s “tough” brand image is a competitive advantage in terms of attracting customers who favor or relate to this image. However, in some cases, its brand image is a competitive disadvantage because it does not appeal to certain target segments such as female riders. 2. Product customization: The most distinctive feature of Harley was the V-twin engine. The V-twin engine’s simple design allowed owners to tinker with their engines. At present, Harley offers a complete line...
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...Future Harley-Davidson Report MKTG 445 Dr. Mattson September 29, 2004 Jason Conlon Daniel Adkins Eric Huffman Kyle Hahn Table of Contents Introduction Page 3 Global Competition Page 3 New Competition Page 5 Competitive Remakes and Accessories Page 7 Motorcycle Buyers Page 9 Motorcycle Company Websites Page 11 Conclusion Page 13 Works Cited Page 14 Introduction Over the past few years, Harley Davidson has had to make numerous changes to remain competitive. The first thing we will take a look at is global competition. Harley Davidson’s increasing demand overseas has caused many changes over the past few years. The second thing we will take a look at is new competition. The demographics of the nation have been changing, due to the aging of the “baby boomers,” and Harley has to make changes in order to keep up with the competition of the market. New competition ranges for sport bikes to other competing cruiser models. The third thing we will look at is competitive remakes and accessories. The competition for Harley is on the rise due to the high interest in custom motorcycles and cheaper accessories. The fourth thing we will take a look at is motorcycle buyer’s demographics. The market is ever changing and it is important to look at how Harley is adapting to these changes. The final thing we will address is how the...
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...Entrants: Low Like any automobiles, Harley-Davidson's industry requires large manufacturing facilities and equipments to enter. New Entrants would have to have a large amount of capital is start in this industry. Already established firms such as Harley-Davidson, Honda, Suzuki, Kawasaki, Yamaha, and Ducati have the advantage of brand recognition from all over the world. These companies also established customer loyalty, especially Harley-Davidson. This means that any new entrants trying to enter the industry have to spend tons of money in advertising and promotion to receive the same amount of brand recognition and customer loyalty that these powerhouse companies in this industry already have gained. With the lack of brand recognition and customer loyalty, retailers would be afraid to carry such product because of the risk it carries if it doesn't give you profit. Threat of Substitutes: Low Motorcycles are seen as leisure products and don't take much out of one's income. Some substitute items for a motorcycle is a motor scooter and dirt bikes. Customers will switch to the substitutes if price increases and purchasing a cheaper substitute will be the bette... Threat of New Entry: Low Requiring high capital investment to enter the business because of the scale economies in production, research, marketing and service of this industry is high. Brand Identification of Harley Davidson has been strongly established...
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...opportunities, and threats. What are Harley-Davidson’s SWOT, specifically the opportunities and threats external to the organization and under consideration of the fact that they are looking to expand overseas? First we must define SWOT. The purpose of the SWOT analysis is to analyze the company from four key strategic areas to better determine what changes they should make. SWOT first looks at the strengths and weaknesses of the organization; these are internal factors to the company. This is to help the company get a firm grasp on its core market advantages and areas that competitors may criticize the company for. Companies typically make core strengths their focal point for marketing. The purpose of identifying and defining the organizations weaknesses is not only to bring them to light, but to understand them so that they can decide what areas to improve and what areas are inherent in their business. Opportunities and threats are factors external to the organization. Identifying opportunities will hopefully point out untapped opportunities organizational leaders should consider capitalizing on. Threats identify external factors like changes in government regulations, costs, environmental standards or any other condition change that can affect the company external to the company itself. The threats to Harley-Davidson are considerable. For starters when the Michigan State Police proved that BMW heavyweight motorcycles outperformed the Harley-Davidson’s it sent a shockwave...
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...Harley-Davidson maintains a large margin in its dominance in the U.S. Heavyweight Motorcycle market as compared to its major competitors. While the United States is HOG's most important market, the company sells motorcycles in many other markets worldwide. Harley-Davidson owns one of the strongest brands in the world, which helps it attract and retain a loyal customer base. The company established a strong brand image with its motorcycles achieving iconic status and being ranked among the world’s most valuable brands. Harley-Davidson’s motorcycles are known for their traditional styling, design simplicity, durability and quality which are why customers deem HD’s premium price to be “acceptable or reasonable”. The Harley-Davidson brand has significantly contributed to the success of the company by building strong market recognition and a loyal customer base. * Long Term Risk Overall Harley Davidson is a strong company with excellent margins and constantly growing revenues. The main concern for Harley is whether or not they can sustain their growth in the face of improvements in their competitors’ products and a maturing market. One major trend facing Harley Davidson is that average age of a Harley Davidson is getting higher, meaning the company is not as successful now as it has been in the past at attracting new and younger riders. This is also evidenced by the slightly weaker sales in less powerful entry level bikes. Many of HD’s competitors are more diversified...
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...HARLEY – DAVIDSON: Preparing for the Next Century Harley-Davidson (Harley) was founded in 1903 as a small business and became the largest motorcycle company in the world after 15 years of operations. Moreover, by 1950, Harley-Davidson was the leader in the U.S. Market with over 60% market share. Historically, the key success factor in Harley-Davidson combined two important ingredients: several competitive advantages and favorable conditions in the motorcycle industry since the industry was almost new and the barriers to enter or the forces affecting it were weak (see appendix 5.1). After the victory of Walter Davidson riding a Harley-Davidson in a race and the development of unique innovations such as the V-twin engine, Harley obtained a strong reputation of being the pioneer in the motorcycle industry. Further, a high investment in Research, Development and innovation, an adoption of an “image and lifestyle” marketing strategy, the “raw power” appearance of its products, and the powerful connection with the American national symbols, made Harley-Davidson very attractive for the society, and help the brand in gaining customer´s loyalty (especially the men). Through Porter´s 5 forces framework (see appendix 5.1), it can be noticed that by the moment Harley-Davidson entered to the industry, the market was plenty of business opportunities and this context allowed Harley-Davidson to obtain a strong position until 1960: low barriers to entry due to the technological investment...
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...HARLEY-DAVIDSON STRATEGIC PLAN Submitted by Stacey Wagner Prepared for Professor Don Looney Business Policies and Strategies Spring 2007 TABLE OF CONTENTS VISION STATEMENT .................................................................................................... 3 MISSION STATEMENT ................................................................................................. 3 EXTERNAL ASSESSMENT ........................................................................................... 3 External Audit ................................................................................................................. 3 Porter’s Five Forces Analysis ......................................................................................... 7 External Factor Matrix .................................................................................................... 8 Table 1 ................................................................................................................ 8 Competitive Profile Matrix ............................................................................................. 9 Table 2 ................................................................................................................ 9 INTERNAL ASSESSMENT .......................................................................................... 10 Key Internal Forces ........................................................................................................
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...Europe, and achieving a sustainable competitive advantage. So, HDI is seeking to penetrate the market as well as engaging in market development, which in this case means attracting a new demographic segment of younger and European customers it has not yet attracted before due to several reasons such as the price and the appeal of the Harley Davidson brand as being a motorcycle “an old guy would drive”. As stated in the case study, HDI does not and will not have cost leadership in the industry it competes in. The huge gap between Honda which produces over 5 million bikes annually and HDI, which produces slightly over 200.000, allows Honda to benefit from economies of scale and therefore offer their products at lower prices than HDI. The relatively small size of HDI limits its ability to invest in technology and new products, which means that HDI neither has the most advanced technology, nor superior performance. However, as the company recognizes, it is not selling motorcycles, it is selling the “Harley Experience”. This lifestyle and spirit, which no competitor has been able to copy or even beat so far, is the competitive advantage and USP of HDI. Harley Davidson motorcycles are not primarily a transportation vehicle, but a statement of style. The HDI image and the brand loyalty among its consumer base are the company’s strongest assets. As the demand in Europe is increasing, HDI should consider expanding its production capacity. This might be necessary anyway, as there is already...
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...Table of Contents Executive Summary …..….…………………………………………………………………………………………………………………………1 Harley-Davidson’s Competitive Advantages ..………………………………………………………………………………………….2 Symbol of Innovation and Toughness ……………………………………………………………………………………….…2 Uniqueness and Distinction …………………………………………………………………………………………………………2 Facing Challenges ………………………………………………………………………………………….…….……………………..3 Future Sustainability ……………………………………………………………………………………………………………………3 Vulnerability ……………………………………………………………………………………………………………………………….4 Challenges of the 21st Century ………………………………………………………………………………………………………………….4 Strategies to Address the Challenges ………………………………………………………………………………………….5 Short-Term Strategies as Harley Matures ……………………………………………………………………………………6 Long-Term Survival ……………………………………………………………………………………………………………………..7 DaimlerChrysler Automotive Group …………………………………………………………………………………………………………8 Business Strategies ……………………………………………………………………………………………………………………..8 Production Issues ………………………………………………………………………………………………………………………..9 Harley-Davidson’s Transformation ……………………………………………………………………………………………10 Why DaimlerChrysler Fell ………………………………………………………………………………………………………….11 Ford Motorcycles ………………………..…………………………………………………………………………………………………………12 Strategies ……….…………………………………………………………………………………………………………………………12 Customer-Perceived Value …..…………………………………………………………………………………………………..13 Extension of the...
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...Executive Summary “Harley-Davidson is the iconic American motorcycle manufacturer. Founded out of a small shed in 1903 by William S. Harley and Brothers Arthur and Walter Davidson in Milwaukee, Wisconsin. The Motor Company produces traditional cruiser motorcycles utilizing air-cooled V-Twin engines. When Harley and Davidson produced and sold their first motorcycle in 1903, they were one of many small motorcycle marques springing up across the country. Flash forward more than a century and the Harley-Davidson brand is so rooted in American culture that the history of the company intertwines with the history of America itself. “ Harley- Davidson a brand that say I’m an American with its strong image they summarize what biking is and isn’t. They produce quality products that are reliable and durable. With so much more to offer Harley-Davidson cannot compete with the Japanese in terms of market share in Europe they only have 6.4% which is excruciating for a company who consider their product as a luxury item with all top of the line parts, brand image ,and all the thing they offer to the consumers. That’s why we look for alternative that could be beneficial to Harley-Davidson which is Market penetration, market development, and product development in Europe. We generated this idea ease them and with employees who know what their job is and make the necessary adjustment in their product or service need not worry of what will happen. Situational Analysis Environment The...
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...Name: Ahmed Helmy Abd El-Hady ID :12105613 Q1- What is the nature of the international business environments Harley faces? What types of risks does the firm face? 1st Cross-cultural Risk • Operates in different facilities in the U.S., Brazil and Australia. • Potential growth markets include Canada, Japan, Australia, Latin America (Brazil). • Many cultural differences in languages, lifestyles, customs, and religion of the various countries. • Lead to inappropriate business strategies and ineffective relations with customers. 2nd Country Risk (also known as political risk) • Chinese Market- With the opening of its third dealership in China during 2008, Harley faced a large and potentially risky market. • Differences in the country’s political, legal, and economic systems may adversely impact firm profitability. • Government intervention: restricts market access; and limits the amount of earned income that firms may expel from foreign operations. Q2- How can Harley benefit from expanding abroad? What type of advantages can the firm obtain? What advantages acquired abroad can help Harley improve in its home market? 1st Benefit from expanding abroad Diverse of product • • Adjust with the demands of the consumers. Allow company to separate business from domestic economic slumps. 2nd Advantage that can Harley obtains Loses can be reduced • • Diversifying the business in different areas. The loses faced by one market can be cover by the...
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...Internationalization at Harley-Davidson Founded in 1903, Harley-Davidson (Harley) is a U.S. motorcycle manufacturer that offers thirty-five models through a network of nearly 1,500 dealers. Its annual revenues are about $6 billion, mainly from sales of the big bikes that made the firm famous. Harley earns three-quarters of its total sales in the United States, where it also manufactures almost all its bikes to ensure quality control. The firm makes four distinctive groups of models: ■ Standard. Practical bikes used for low-cost commuting. ■ Performance. Sleek, sport-style racing bikes built for speed and easy handling. ■ Custom. Stylized bikes customized to customer tastes. ■ Touring. Long-distance, large-capacity, comfort bikes that typically include cruise control, stereos, and luggage racks. In the United States Harley competes primarily in the custom and touring segments, which account for around 85 percent of “heavyweight” sales. Its numerous competitors are all headquartered outside the United States and include Honda, Suzuki, Yamaha, and Kawasaki in Japan, and BMW, Ducati, and Triumph in Europe. New competitors are emerging from China. Harley heavyweight bikes sell for $17,000 or more, which puts them beyond the reach of many buyers. The average age of a Harley buyer in the United States is nearly 50. One key to Harley’s success is the Harley Owners Group (HOG), a club of loyal Harley owners with over one million members, including 100,000 in Europe. HOG is...
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