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To:c Joanc Smithfield,c CEO,c Smithfieldc Customc Furniture
From:c Gregoryc Brownell,c Seniorc Strategyc Analyst
Date:c 01c Aprilc 2022
Subject:c Analysisc ofc Newc Productc Line
c c c c c c c c c c c c Smithfieldc Customc furniturec isc lookingc toc extendc itsc productc line.c c
Therec arec somec concernc ofc whatc pathc toc takec withc thisc newc productc line.c c
Thisc memoc addressesc somec ofc thec concernsc relatedc toc thisc decisionc andc
offersc ac recommendationc ofc thec bestc routec toc take.
A. Porter’sc Competitivec Advantagec Modelc describesc howc ac companyc canc
usec competitivec strategyc toc bec successful.c c Accordingc toc Porter,c therec
arec fivec waysc toc ensurec success.c c Thec modelc showsc overallc
differentiation,c overallc lowc cost,c focusedc differentiation,c andc focusedc
lowc costc asc fourc differentc competitivec strategies.c c Finallyc therec isc anc
integratedc approachc thatc combinesc thec previousc four.c c Smithfieldc
Furniturec hasc thec optionc toc startc ac newc productc linec thatc fallc withinc
twoc ofc thec fivec strategiesc ofc Porter’sc Model.c c Thec firstc optionc ofc
upscalec furniturec marketedc toc thec topc 7.5%c income-earnersc isc
consideredc ac focusedc differentiationc strategy.c c Thisc strategyc dependsc
onc maintainingc ac loyalc customerc basec thatc arec convincedc onc thec qualityc
orc exclusivityc ofc thec product.c (Bruton,c 2022c parac 11)c c Onc thec otherc
hand,c ifc thec companyc werec toc massc producec andc massc marketc somec
furniturec atc ac lowc pricec point,c itc wouldc bec consideredc anc overallc lowc
costc strategy.c c Anc examplec ofc thisc typec ofc strategyc wouldc bec thatc ofc
Costcoc andc Walmart.c (Bruton,c 2022c parac 9)
B. Thec bestc strategyc forc Smithfieldc isc toc pursuec isc thec focusedc
differentiationc strategy.c c Sincec thisc strategyc reliesc onc ac particularc
customerc base,c thec successc ofc Smithfieldc canc helpc launchc thisc newc
productc line.c c Smithfieldc alreadyc hasc thec equipmentc andc furniturec
buildingc experience,c theyc justc needc thec rawc materialsc andc visionc toc
startc makingc thisc productc line.c c Thec lowc costc optionc hasc tooc manyc
disadvantagesc andc canc tarnishc thec namec ofc Smithfield.
C. Thec firstc stepc toc ensurec Smithfieldc shouldc doc toc ensurec thec companyc
movesc inc thec rightc directionc isc toc conductc anc Industryc Analysis.c c
Smithfieldc shouldc startc byc conductingc andc industryc overview,c
reviewingc industryc newsc andc innovation,c reviewc consumerc marketc
data,c conductc researchc onc competitors,c determinec thec economicc
conditionsc andc influences,c andc researchc governmentc regulations.c
(Purdue,c 2013)c c Thesec stepsc willc showc thec companyc ifc enteringc thisc
marketc isc feasiblec andc profitable.
c
Bruton,c J.c (2022).c Porter'sc Competitivec Strategies.c Inc Lumenc Learningc (Ed.),c
Principlesc ofc Management
c (Modulec 4).c Lumenc Learning.c Retrievedc fromc
https://courses.lumenlearning.com/wmopen-
principlesofmanagement/chapter/stages-and-types-of-strategy/
Purduec Libraries.c (2013).c
Introductionc toc Industryc Analysis
.c
YouTube
.c
Retrievedc 2022,c fromc https://www.youtube.com/watch?v=5DFd-ZNbNX4.
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