goodyear case
Good Year and Tire Rubber Company
Good Year Tire and Rubber Company Case Analysis
Background
Goodyear Tire and Rubber Company is a profitable business which was founded in 1898. When 38 year old Frank Seiberling purchased the company he knew nothing on the longevity and success it would bring. Mr. Seiberling installed a down payment on the first Goodyear plant with a borrowed amount of $3500.During the late 1800s and early 1900s cotton and rubber were considered the lifeblood of the industry. At the time of Goodyear’s founding the existence of bicycles was fresh and business was booming at an increasing rate. With faith and the determination of 13 employees Goodyear’s initial production line consisted of bicycle and carriage tires, horseshoe pads and poker chips. With now a new need for bicycle tires being a demand for consumers Goodyear carved its mark in history as the world’s largest tire company in 1916.
Strategic Issues and Problems
In early 1992 Goodyear began to consider a previously declined proposal of Sears. This previously declined proposal now would benefit Goodyear because the company suffered a loss of $38 million. Good year’s market share and customer retention are both decreasing and this is becoming the overarching problem for the company.
The factors to consider before making a decision on the sears proposal at hand are:
1. Goodyear brand tires reportedly declined in market share by 3.2%
2. About 2 million used or worn out Goodyear tires were being replaced at sear automotive centers by top brand tires
Analysis and Evaluation
Nature of Industry
The market for tires is one that will exist regardless of any external factors. It is a market with a permanent presence because they play an important role in the mobilization of many consumers. They play a role in the safety and transport of many consumers and goods as well. Although you would think the demand for tires would help increase sales or benefit commerce the United States tire
Good Year Tire and Rubber Company Case Analysis
Background
Goodyear Tire and Rubber Company is a profitable business which was founded in 1898. When 38 year old Frank Seiberling purchased the company he knew nothing on the longevity and success it would bring. Mr. Seiberling installed a down payment on the first Goodyear plant with a borrowed amount of $3500.During the late 1800s and early 1900s cotton and rubber were considered the lifeblood of the industry. At the time of Goodyear’s founding the existence of bicycles was fresh and business was booming at an increasing rate. With faith and the determination of 13 employees Goodyear’s initial production line consisted of bicycle and carriage tires, horseshoe pads and poker chips. With now a new need for bicycle tires being a demand for consumers Goodyear carved its mark in history as the world’s largest tire company in 1916.
Strategic Issues and Problems
In early 1992 Goodyear began to consider a previously declined proposal of Sears. This previously declined proposal now would benefit Goodyear because the company suffered a loss of $38 million. Good year’s market share and customer retention are both decreasing and this is becoming the overarching problem for the company.
The factors to consider before making a decision on the sears proposal at hand are:
1. Goodyear brand tires reportedly declined in market share by 3.2%
2. About 2 million used or worn out Goodyear tires were being replaced at sear automotive centers by top brand tires
Analysis and Evaluation
Nature of Industry
The market for tires is one that will exist regardless of any external factors. It is a market with a permanent presence because they play an important role in the mobilization of many consumers. They play a role in the safety and transport of many consumers and goods as well. Although you would think the demand for tires would help increase sales or benefit commerce the United States tire