Discuss the strategy and need of Family Fabrics Corporation?
Introduction
Family Fabrics Corporation immediate needs are basically to restart generating income. The rebuilding process will take more than year and even much longer for the plant to be operational. The company can decide to continue with it’s specialize line of business which is the production of trendy cloth line or venture into another field as it awaits the construction of its business premises.
The options that are open to the Family Fabrics Corporation are limited to its internal and external analysis. The current economic environment and the competitive nature of the global apparel market that involves aggressive marketing techniques and the entry of internet or online sales presents even a bigger challenge for Family Fabrics Corporation (Wells, 1998). The company must undertake a complete industry analysis through the use of such techniques as PEST analysis or Porters five forces. The company must also carry out a SWOT analysis before it can settle on the alternatives to adopt (Hill & Jones, 2010).
The major strengths that the company may have are its customer loyalties to its strong brands like the ArcticCloth and a series of other brands that made the company maintain its current position. The other opportunities are the emerging markets that are coming up due to globalization and the introduction of the wider online internet sales as technology continues to advance. However, the major threats may come from the company’s competitors and their ability to upstage the market to their own advantage. The company must plan strategically given that one of its major weaknesses would be financial constraints as funds would be required to finance the new factory premises and also replace the destroyed plant.
To restart production, the company has to lease new premises preferably near the ruins of the destroyed factory as it would it would be more convenient to the former employees of the factory. Given the reports of the SWOT analysis, the availability of funds would determine if the company would require funding to purchase new plant for the production of cloths should it decide to continue with its original business.
The company has to redefine its mission statement as its current status would be like starting a new company. A new strong and motivating mission may work well with most of the staff especially after the disaster. Mission statements also reveal the kind of work that the organization is manufacturing or dealing in.
However, before developing the mission statement, the company should develop a business model that will outline how the business will select its customers, define its market and differentiate its products in the market. The company should also outline how it will create more value its loyal customers while acquiring and retaining the new customers, how it will produce the cloths, lower its manufacturing costs and deliver the cloths in the market. The company must also give an outline of how it will directly configure its resources in order to achieve sustainable income while maintaining high profitability.
To implement the business strategy, the company should set its major goals which must contain the following characteristics. 1) The goals should be clear and measurable as they are supposed to provide the yardstick to judge the company’s performance. 2) The goals should address crucial issues that focus on the core business of the company. 3) The time period for the goal to be achieved should be clearly specified. 4) The goal should be realistic.
Functional level strategies
These are the strategies that seek to to improve the performance of the functional units of the company such as manufacturing, marketing, production and customer services.
Business-level strategies
These strategies describe the overall competitive strategy of the business, its marketing strategies like product positioning, branding and market segmentation. Product positioning entail cost leadership strategies and pricing policies (Bryson, 2011).
Global strategies
These strategies seek to address the position of the company regarding global markets and future expansion and growth. Should the company maximize its long term profitability and what efforts are required for the company to be competitive locally and internationally.
Corporate level strategies
The company should address the kind of business that would maximize its profitability globally or locally. The company should increase and expand its markets to region that its products are most marketable.
The strategies identified mostly through SWOT analysis should be compatible or congruent with the rest i.e. the business strategies adopted should be able to support the functional level strategies and also the corporate level strategies.
Strategy Implementation
It involves making key decisions and actions on the functional, business, global and corporate strategies and how they should be executed. Strategy implementation may involve rebranding existing products by redesigning them and repositioning them in the market while segmentation may involve differentiation and positioning of products in different segmented markets. Corporate strategies may include mergers and acquisitions or joint ventures as strategies to penetrate external markets internationally (Thompson, Peteraf, Gamble & Strickland, 2010).
Finally, the destruction of the factory may provide an opportunity for the company to reinvent itself and rebrand its image into a new outfit that’s modern and advanced. The company should take advantage of the new beginnings to embrace new technology and advance its manufacturing processes into a lean and efficient production process that’s cost effective and profitable.
References
Bryson, J. M. (2011). Strategic Planning for Public and Nonprofit Organizations (4th ed.). San Francisco: Jossey-Bass/Wiley.
Hill, C. W., & Jones, G. R. (2010). Strategic Management:An Integrated Approach. Mason, Ohio: South-Western, Cengage Learning.
Thompson, A. A., Peteraf, M. A., Gamble, J. E., & Strickland III, A. J. (2010). Crafting and Executing Strategy:Concepts and Readings (18th ed.). New York: McGraw-Hill/Irwin.
Wells, S. (1998). Choosing the Future:The Power of Strategic Thinking. Boston: Butterworth-Heinemann/Elsevier.
