Silver Ship

Topics: Shipbuilding, Ship, Watercraft Pages: 6 (1546 words) Published: March 22, 2012
Recommendations for Silver Ships to gain a competitive advantage in the Military and Workboat Industry 1. Focus on the Gulf of Mexico
a. As stated in Exhibit 4, Silver Ships has had quite a few buyers focused around the Gulf of Mexico. b. Alabama is in the middle of the US shoreline for the Gulf of Mexico. c. Silver Ships can use the International Workboat Show stated in Exhibit 3 to draw more customers from all around the Gulf. i. They have already have had previous orders from Panama, Jamaica, and Costa Rico. Mexico and the Dominican Republic are potential new buyers. ii. As off shore drilling comes back after the BP/Deepwater Horizon oil spill, Silver Ships can focus on more oil and gas companies. iii. The Gulf will always be a big part of the US fishing industry the New Orleans boat show is an excellent opportunity to sell to fishing companies.

2. Aggressively pursue military contracts
d. As stated in Exhibit 4, military contracts bring stability to boat builders because they are typically long term. e. Silver Ships should use similar foreign partnerships such as the one with GDELS to obtain a US Army contract (see Exhibit 2) in order in increase diversity and knowledge of military style boats. f. The US Navy and Coast Guard are looking for new boats specifically to fight terrorism in the littoral zone waters. iv. Develop bullet proof boats and/ unsinkable boats 1. As seen in Exhibit 3, rival boat builder SAFE Boats has developed small-arms proof hulls and ACB has developed a boat that does not sink after one impact. 2. Silver Ships needs their own niche directed towards military needs.

3. Build up money stock pile for tax increases on small businesses g. As stated in Exhibit 1, an external threat to Silver Ships is the likelihood of increased taxes on small businesses. h. Owner Mike McCarty needs to save income to be prepared for the first couple of years of the tax increase. i. As seen in the suppler category of Exhibit 2, there is not much room for adjustment when it comes to cost. The increase taxes could hit hard and it may take Mr. McCarty a while to be able to offset the new taxes.

4. Build new facility in Virginia
j. This recommendation has a high risk and high reward factor. It should only be followed after adjustments for new taxes on small businesses. k. A Virginia facility would help Silver Ships to have a division of the company focused on military contracts. The Alabama facility can then focus on oil and gas companies and workboats. l. A new boat building facility in Virginia would give Silver Ship the following abilities: v. Silver Ships can use the Multi-Agency Craft Conference stated in Exhibit 3 to receive more military contacts. vi. Virginia is closer to Washington and military headquarters such as the US Coast Guard, US Navy, and Department of Homeland Security. 3. Both the MACC and US military headquarters position to the new facility will help Silver Ships to highlight its dedication to their requests and help to start a relationship which can produce more long term contracts. m. Recommendation four is separate from the second one but can greatly enhance the second’s goals. Specifically the differentiation tailored towards the US Navy’s desire for boats to fight terrorism in the littoral zone. n. As stated in Exhibit 4, Silver Ship has had the same amount of common stock for a few years now. The company can sell more stock to raise capital needed for a new facility.

Exhibit 1
Current State of Silver Ships
* Size
* Increased revenue from $5.7 million in 2006 to nearly $11 million in 2009 * Growth
* Immediate growth opportunities in bidding on contracts to produce vessels needed by the US Navy and US Coast Guard to thwart terrorist near shore and ports. *...
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