Steinway & Sons: Buying a Legend(a)
Steinway & Sons: Buying a Legend(A)
¢ñ. Statement of Problems and Issues
Summary
For 140 years, Steinway & Sons has set the standard for the quality manufacture of pianos. Why is Steinway legend? What made it so a great master? After first step into piano industry ¡°Steinway¡± and the word piano are almost synonymous. Working a long-term ¨C and still going- technical and market strategy that emphasized quality is to say, since the first Steinway family members arrived in New York from Germany in the middle of the 19th century, the company has pursued a strategy of making high-end quality product, selling them through its own sumptuous outlets and through a network of dealers, and gaining exposure by encouraging premier performing artists to use the pianos.
In the early 1970s, Steinway encountered competition from low-cost producers based on in Japan. While Steinway¡¯s fine image and reputation was unquestioned, the business wasn¡¯t particularly profitable. In addition to it, due to some stockholders who were unwilling to invest but mainly interested in income, Steinway¡¯s financial conditions became worse, so the family company came to an end, was sold to CBS. CBS recognized that the business didn¡¯t fit its corporate strategy. In 1985, CBS sold the company to John and Robert Birmingham, Boston-based investors. Under Birmingham, Steinway returned to its former stature, stressing quality and focusing on the high-end market. But ten years later, Steinway is also sold two investors, Kyle Kirkland and Dana Messina because of financial problems.
Problems and Issues
Now, the two young entrepreneurs have some questions and need to decide something important. Whether Steinway would continue its high-end quality piano or alternatively, pursue some bolder, more aggressive plan? Also they should decide what to do with the recently introduced line of Boston pianos. Did it make sense for Steinway to sell mid-priced pianos and how can they leverage the Steinway
¢ñ. Statement of Problems and Issues
Summary
For 140 years, Steinway & Sons has set the standard for the quality manufacture of pianos. Why is Steinway legend? What made it so a great master? After first step into piano industry ¡°Steinway¡± and the word piano are almost synonymous. Working a long-term ¨C and still going- technical and market strategy that emphasized quality is to say, since the first Steinway family members arrived in New York from Germany in the middle of the 19th century, the company has pursued a strategy of making high-end quality product, selling them through its own sumptuous outlets and through a network of dealers, and gaining exposure by encouraging premier performing artists to use the pianos.
In the early 1970s, Steinway encountered competition from low-cost producers based on in Japan. While Steinway¡¯s fine image and reputation was unquestioned, the business wasn¡¯t particularly profitable. In addition to it, due to some stockholders who were unwilling to invest but mainly interested in income, Steinway¡¯s financial conditions became worse, so the family company came to an end, was sold to CBS. CBS recognized that the business didn¡¯t fit its corporate strategy. In 1985, CBS sold the company to John and Robert Birmingham, Boston-based investors. Under Birmingham, Steinway returned to its former stature, stressing quality and focusing on the high-end market. But ten years later, Steinway is also sold two investors, Kyle Kirkland and Dana Messina because of financial problems.
Problems and Issues
Now, the two young entrepreneurs have some questions and need to decide something important. Whether Steinway would continue its high-end quality piano or alternatively, pursue some bolder, more aggressive plan? Also they should decide what to do with the recently introduced line of Boston pianos. Did it make sense for Steinway to sell mid-priced pianos and how can they leverage the Steinway