Free Strengths Case Study Sample

MAYTAG CORPORATION

INTRODUCTION
Maytag has been in the USA market since 1893. The company started from farm machine and soon moved to washing machines segment in which the company currently holds 21.6% market share in home appliances. Also, Maytag has limited premium share in the commercial appliance. Maytag has come long way to the current strategic position with a central focus on the home market of North America. The company’s strategic moves in international markets have not proved to be fruitful. Currently, Maytag has maintained focus on the local market of local North America.

ANALYSIS

SWOT analysis has been used toanalyze the internal strengths and weaknesses of the company as well as to analyze the opportunities and threats in the external environment.

WEAKNESSES

OPPORTUNITIES

THREATS

STRATEGIC RECOMMENDATIONS

SWOT analysis revealed that Maytag has considerable internal strengths; however, despite these strengths Maytag has not been able to exploit the market potential as number one leader. Therefore it is critical for the company to make the most of its strengths. The company is faced with the competitive pressures while lacking its ability to expand internationally. Externally, the local market has reached the maturity stage where competitive pressure from local as well as international players is increasing. There are also limited opportunities present in the local market as compared to the considerable potential in the international market. so, it is important for the firm to identify and prepare a plan to capitalize these opportunities in order to maximize its profits.

Hence, following strategies are proposed to the company for sustaining in the competitive marketing conditions:

– Expand in the local market with increased emphasis on marketing. Maytag can increase the local market share by changing the product perception into the lifestyle product. This can be done by exploiting its capability to innovative marketing concepts. Also, the low-end products shall be allocated a share in marketing budgets to expand the market. This move will contribute in companies’ market share as well as economies of scale. In addition to this, the product line such as range (gas and electric) also offers potential to achieve a leadership position. Such penetration in the local market shall also be supported by vertical integration. For instance, as a survey has revealed that consumer loyalty increases at a much higher pace on giving after sales service to customers.
– Using Ansoff’s recommended market strategy matrix, Maytag is required to develop a product line of commercial for the mass market. It is critical for it reducing the company dependency on the home appliances that are considerably vulnerable to mature situation of the industry. In addition to expanding customer base, this strategic measure will also contribute to the company’s operational efficiencies.
– Maytag’s strong competence of product development also requires that the company shall now diversify other related industries in the local market on the ground of its brand acceptance. Also, its successful brand reputation for its quality and durable products can endorse its presence its presence in the new market. Complete kitchen and home appliances offer potential of market growth. This will allow Maytage to leverage its expertise as well as synergies to the new market selected for entry.
– Furthermore, it is also important for an organization to further reduce the board member mainly by replacing Craig Breese (President of Maytag International) as the member does not have any contribution in the company reports. Instead, it is high time that Maytag adds international strategist to its board.
All these measures are considerably necessary for the organization to sustain its competitive position in the market. Also complimented with the company’s increased protection to shareholders’ approval of integrating takeover potential, these strategies make organization considerable attractive stock buying option.
In addition to this, company is also in critical need to expand its footings in the international market. It is critical in a situation where local market has become mature, and any shock from the external environments such as economic shock can have considerable impact on the company’s ability to sustain. Also, it is mandatory for the fact that companies from the global market are attempting to enter the international markets for expanding their portfolio. International market expansion that offers five to six percent growth, mainly in fragmented Asian markets, is an attractive opportunity to exploit. Maytags is recommended to enter a new market with localized strategy as Maytag’s recent position as the company has not been able to sustain the local cultural pressures. Expansion in the new market can be done, either by buying a percentage of stake in the market or expand it with the passage of time in order to take care of its lack of ability to adapt culture. Maytag has already developed a sound ability to transform the consumer preferences into lifestyle product, therefore, by leverage such capability Maytag has much potential to grow in the international market.