RKS Guitars doesn’t have a strategy to set their product firmly and sustainable in the guitar market. The symptoms of this problem can be seen in the slow logistics of shipping and assembly of the products that were not matching the order deadlines and also the high costs that involved the full process of guitar development and advertising compared to the low perception of earnings that the company feel at that moment.
The alternatives for the company are the following:
1) RKS must stay with their actual Marketing and Distribution arm, Hohner. * Pros (+):
I) Established distributor of musical instruments: This means that the company has contacts and networks that could make the brand immersion into the market easier. II) RKS won’t need to make their own investment in information and other investigations, as this will be their partner’s work. III) RKS can focus their work in improving their products and processes. * Cons (-):
IV) No Tangible contribution of Hohner into RKS Guitars results yet. V) Opportunity cost of having all the faith set in Hohner and not exploring other potential partners. VI) Not involving the company in the market research will establish comfort in RKS that could be harmful in the future.
2) RKS must end their bonds with Hohner and find another Partner. * Pros (+):
VII) A new partner could be a door to a different approach of the product that can be complemented with the learning that RKS got from their work with Hohner. VIII) A new partner could mean newer and better ideas for the brand. IX) A new partner could mean a new business structure that could be translated to better profits in the short term. X) If RKS is not feeling comfortable with their actual results, a fresh start can work as a relief for the company that had a lot of doubts of their results with Hohner. * Cons (-):...