Surplus Styles
Beauty products such as hair care and lotions have been changing the market trends gradually, now consumers are more aware of the environment and nature. As a result people are demanding more organic beauty products. The Surplus Styles Company needs to change their hair product line because other competitors are meeting people’s demand by having better organic quality products. Changing the product is not an easy task for the Director of Sourcing, his expertise of competitive cost has to change to quality because that is what companies are focusing on, Now the company needs to find a perfect strategy to focus on providing better content quality in their products.
Case Study Summary
The case study is based on the Surplus Styles Company, which is a manufacturer of hair care products including shampoos and conditioners (Sanders, 2012). The company bottles the shampoos and other hair care products in their plants. Additionally, the Surplus Styles are also known for their competitive-cost. The Director of Sourcing Derick M. Frizzle has worked on competitive bid process for the past 10 years and has moved up the ranks by his cost-competitive strategy in its market segment (Sanders, 2012).
The President, Frederick Davenport
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Having higher quality standards can be costly because of the production process or labor that these companies use is different, they are more focus on quality than cost. Due to consumer changing their lifestyles the price is no longer the main focus, but the quality is. Additionally, competing on quality is important for the supply chain management because the attribute of competing on quality is product traceability (Sanders, 2012), meaning the product is reliable. Unlike cost standard, in where they offer the lowest price but the product might not be
Price increases in the raw material mean that prices needed to be increased, but customers were still willing to pay for a quality product.
Quality is an important part of any business rather from a customer’s perspective or a producer’s perspective. Quality from a customer’s perspective is they “want value and quality has become a major factor in the value of products and service” (Russell & Taylor, 2013, pg. 53). “The customer is the most important part of the production line” (Russell & Taylor, 2013, pg. 53). This can be referred to as quality of design meaning “involves designing quality characteristics into a product or service” (Russell & Taylor, 2013, pg. 54). Now let’s look at the quality from a producer’s perspective. This can be referred to a quality of conformance meaning “making sure the product or service is produced according to design” (Russell & Taylor, 2013,
You can either minimize cost or you can aim for the highest quality of product and customize according to the requirements of the market place. Some products are by their nature standardized. However it is impossible to differentiate the product in the mind of consumer. This tends to put all the emphasis on cost and therefore on prices. There is no point in the consumer paying extra for the same products. However by K-mart and Sears should use strategies like changing the location of stores in a more appealing destination. Both would need development of new name brand products, ones that would be lower cost and a higher quality for customers.
Abercrombie & Fitch Co., also known as A&F, was founded in 1892 by David Abercrombie and Ezra Fitch. Its headquarter is located in New Albany, Ohio. May be nobody knew that this apparel retailer was from its beginning a kind of elite outfitter of expensive sporting and excursion goods. The company, with more than two hundred subsidiaries around the world, sells casual apparel for men, women, and kids.
Threat of substitutes in market as best quality is not always a priority for some customers as they are price sensitive.
HairCare Products stand to capitalize on an open market in China’s beauty and personal care section. With nearly half of its one billion plus population female, HairCare Products can monopolize this market in China if the company offers the Chinese consumer what they really want; natural products. According to Mintel’s report, a global provider of market research, “Eighty-one percent of urban Chinese consumers prefer to purchase all-natural products”. This is an astronomical number that cannot be ignored, if HairCare Products decides to enter the fray of the Chinese beauty and personal care market. Mintel also reports, “Eighty-seven percent of its middle class tend to go for premium rather than standard goods or services”. According to Mintel’s information, if HairCare Products can produce an all-natural product and all-natural product with a heftier price tag, they can corner or capture two major sections of the Chinese beauty and personal care market.
Marketing is a essential part of a business because it helps to control the way that goods or services are sold. When marketing a specific product or service it is crucial to be well informed in all aspects of marketing, which include the marketing mix, marketing strategy, target market in which you will offer your product and the environmental factors that could effect how your product is received, including social and cultural difference, competition, economic and technological aspects. In this paper I will explain how I will market the product which I have chosen. An Herbal Shampoo brand called "Herbalize."
After studying the cosmetic market we can identify a series of needs in this market:
Mistine is still the number one cosmetic in Thailand and provides more than 6,000 products, which are divided into 5 groups (Mistine Cosmetics, n.d.). Mistine offers Body Care, Personal Care, Make Up, Fragrance, and Skin Care (Mistine Cosmetics, n.d.). All of their products are certified and produced through quality manufacturers (Mistine Cosmetics, n.d.). The distributor, Better Way Company, feels that because of its acceptance throughout the Thai market Mistine can become “number one in the heart of worldwide cosmetics users” (Mistine Cosmetics, n.d.). Better Way recently built a new “state-of –the-art” distribution center (Mistine Cosmetics, n.d.). It is being considered “one of the most advanced technological systems in South East Asia” (Mistine Cosmetics, n.d.).
Dr. Edward Deming stated that by improving quality, companies will decrease expenses as well as increase the productivity and market share (PMBOK, 2008).
Nowadays, people attach great importance to appearance. In order to meet different customer needs, each company in cosmetic retailer industry provides various beauty products to customers. Skincare, make-up, hair care products, body care products, perfumes, health and beauty supplements are included.
Products are not standardized and vary by country in terms of type, packaging and specification. This increases production time, production costs, lead tim...
Our next step is to analyze industry environment by applying Porter’s five forces model. In my opinion, bargaining power of the suppliers is fairly weak. The Coca-Cola Co has a pretty good system in place, where it manufactures its own signature concentrate and then sells it to the bottling franchises, which are contracted for 10 year periods. Bargaining power of the buyers is somewhat escalated, since we are still in recession and its natural for consumers to go after the better deal. Potential Entrants create additional production capacity and may eventually generate overcapacity, which results in a forceful price lowering. The variety of the substitute products is one of the strongest forces, it affects brand loyalty and makes it a lot more difficult for the Coke to compete. Last but not least, is the rivalry among existing firms. The main peril for the Coca-Cola
"An article by Beecroft (1999) entitled "The role of quality in strategic management" discusses the significance of quality considerations in the development of effective strategic plan. One primary concern the author saw was the relationship between quality, short and long-term objectives, and bottom line profits. According to the author, "Conformance to design and customer requirements translates to quality, therefore higher conformance is higher quality. Higher quality results in lower costs and increases competitiveness, leading to an increase in sales and market share, more jobs and improved profitability" (p.
The second problem was solved by the brand is a simplification of choice. Every day consumer is faced with many similar products, and he just physically does not have time to compare all the annotations, the percentage composition, indications and specifications (f...