|Case 9 | |Performance Boating Products, Inc. | Performance Boating Products, Inc
I. Situation Analysis
• Performance Boating Products, Inc (PBP) manufactures attachments for boat hulls and motors that aid watercraft in reducing drag and maintaining ‘plane’.
• PBP attachments can be integrated as part of new boats or retrofitted to older boats and motors.
• PBP’s primary installion base includes clients wanting an extra degree of performance from their boats and boat manufacturers offering PBP products as options.
• The PBP executive team has been working for the last few months to put together a plan for expansion projects to increase future revenue flow
• A brief summary of the three individual projects can be viewed in the table below:
|Melville |Broadside |Turbine | |Project Plan: |Project Plan: |Project Plan: | |Construction of new warehouse in a |Construction of new production facility |New apparatus development | |strategic geographic location | | | | |Potential Benefits: |Potential Benefits: | |Potential Benefits: |Increase production to alleviate backlog|Increase future revenues | |Increase sales in the selected |of orders |Expand existing product lines | |geographic region | | | |Reduce distribution costs | | |
|Strengths |Weakness | | | | |Able to command high prices in the market |Products easily replicable | |Design protected by copyright |Inefficient functional managers | |High profit margin due to high markup |Limited production Capacity | |Cheap raw materials (metal and fiberglass) | | |Demand exceeded production | | |Flexible design that can be adapted to existing boats or | | |could be integrated with new boats | | |Opportunities |Threats | | | | |Expansion opportunity present |Development of competition | |New Product Development |Designs can be easily duplicated with minor changes | |Enlarge Production Capabilities |Market will mature and reduction in profit margins | |Restructure corporate environment | |
• All three projects have the same amount of...
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