Professional Documents
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Harley DB 1
Harley DB 1
CISS 479
Harley-Davidson, Inc. operates in the Consumer Goods sector, within the Recreational
Vehicle industry, and specifically in the heavyweight motorcycle segment. Harley-Davidson has
also produces a line of motorcycle parts, accessories, general merchandise and related services.
business on a global basis, with sales primarily in North America, Europe, Asia/Pacific and Latin
America.
The primary business of the Motorcycles segment is to design and manufacture premium
motorcycles for the heavyweight market and sell them at wholesale. The Company is best known
for its Harley-Davidson motorcycle products. The Company’s worldwide motorcycle sales
generate approximately 80% of the total net revenue in the Motorcycles segment during each of
the years 2008, 2007 and 2006, respectively… Harley-Davidson branded motorcycle products
emphasizes traditional styling, design simplicity, durability and quality. Harley-Davidson has
Carson City, Nevada, Plano, Texas, and European operations in Oxford, England. Harley-
Davidson Financial Services provide wholesale financial services to Harley-Davidson and Buell
dealers and retail financing to consumers. HDFS is financed by operating cash flow, advances,
and loans from Harley-Davidson. HDFS main competition is from banks, credit unions, and
other financial institutions. Its insurance business competition tends to come from other national
Resources Tangible
Plant
o Wauwatosa, Wisconsin
o Tomahawk, Wisconsin
o York, Pennsylvania
o Manaus, Brazil
o Harley-Davidson Museum
Finances
o Strong Revenues
Location
o United States Dealers
o Asia-Pacific
o Latin America
o Canada
Human assets
o Board of Directors
o Employees
o Vertical Management
Resources Intangible
Technology
o E-Commerce
o Patents
o Trademarks
Culture
o HOG Clubs
o Sponsorships
Capabilities
Integrated Technologies
Empowered Employees
Brand Recognition
Customer Financing
Dealer Financing
Core Competencies
Integrated Technologies
Brand Recognition
Empowered Employees
Finding of Fact #1: Harley-Davidson is noticing lower sales directly related to the aging
HD has targeted the baby boomer generation for years as its base customer. The average
HD owner is 47.3 years old and they have an average household income of $81,300. As the Baby
Boomers age, Harley needs to replace that customer with a new customer base. I believe Harley-
Davidson needs to concentrate its efforts on appealing more towards the 20 and 30 year olds with
social networking marketing and motorcycles that appeal more toward the younger generation.
Harley is known for its heavyweight division motorcycles. HD needs to set up a social
networking site like Facebook or MySpace to attract the younger crowd that utilizes these
popular sites for socializing. HD could attract followers by promoting a free give away and get
valuable information by having the “follower” fill out a short survey to enter the drawing. Harley
needs this information to develop the motorcycle for this targeted group and fill the needs and
I believe that the younger generation still recognizes the Harley-Davidson brand, but they
perceive the motorcycles to be out of their budgets. Harley-Davidson will need to develop
another entry-level line of motorcycles to get first time buyers away from the crotch rockets and
into their brand. I believe the Buell is a good start for Harley, but Harley needs to take that
design and put a Harley name plate on it to promote progression to the higher profitable Harley
Finding of Fact #2: Harley-Davidson has positive cash flow, but negative income from
structure. Its stock price is at its lowest average price market value in years. Its working capital is
constantly decreasing, while although HD cash flow is increasing on a yearly basis, they still
relationships with suppliers overseas HD can invest its excess cash into relationships with
strategic partners in Europe and/or Asia as well as investing in and building upon relationships
with franchises and other retailers in those countries. Since HD does not have the working capital
to finance growth, yet they do have a positive cash flow, HD must put their excess the cash flow
Dollar and an available cash flow, HD should pursue other short-term investments and long-term
partnerships in the European Union and China. In this way HD can possibly augment its cash
flow exponentially during the current economic recession and increase its current ratio while also
Finding of Fact #3: Harley-Davidson motorcycle sales are decreasing in the United
As disposable income dries up, recreational items can be deferred, reducing sales of
motorcycles similar to what the automotive manufacturers went through recently. Harley-
Davidson needs to hype demand for their motorcycles by implementing a marketing plan that
explains that motorcycles can be used as cheap transportation as well as used in a recreational
style.
Most marketing for the Harley-Davidson motorcycles today is for the HD lifestyle. I
believe Harley-Davidson needs to implement a marketing strategy that targets the city worker
and shows the benefits and gas savings of utilizing its motorcycles. Harley-Davidson
motorcycles can achieve from the mid-30s to the mid-50s in miles per gallon. With the price and
volatility of motor fuel the cost-savings of using a Harley over a normal car can be seen
instantly.
insurance costs, maintenance costs, traffic navigation, and parking. Targeting the younger
working class can also benefit Harley-Davidson as it is targeting a different demographic group
Harley-Davidson could place ads on “green” web sites to target the environmentally
friendly customers. Additionally, HD could develop web sites on free social networking web
sites like Facebook and MySpace. They could explain the cost benefits of a motorcycle over an