Mutually Exclusive and Collectively exhaustive (MECE)
Core Qs-Company (5Cs-Company,Customer, Collaborators, Competition ,Climate)
Strategy (BCG/Porter)
 Market share
 Why to enter/do?
 Current and future Positioning
philosophy- Cost
leader/Differentiator`
Finances
Profits for the last three years?
 What are the major revenue
streams, and what percentage of
the total revenue does each stream
represent?
 What are the major costs? Do any
seem out of line?
Customers based on Product
 Customer segmentation(s)?
 Characteristics?
 Changing needs?
Core Qs-Market: (5Cs-Company,Customer, Collaborators, Competition ,Climate)
Industry
 Where is it in its lifecycle?
(Emerging? Mature? Declining?)
 Market size, growth rate, and
trends? (industrial Attractiveness)
 Industry drivers?
 Margins? BPB?
 Products and Customer
segmentation
 Industry changes? (M&A? New
players? Change in technology? New
regulations?)
Competitors
 Major players and market share?
 Competitive rivalry-HHI Score
Collaborators
 Who are our collaborators?
Product-BCG Matrix/PLC/3 horizons FW
Product mix?
 Life cycle-Threat of substitutes
 Cost/margins? Profitability?
 Product differentiations? (PoD/PoP)
 Market share?
 Cannibalization between products?
Price
 Pricing strategy
Promotion
 Brand? Market leader?
Place
 Distribution channels?
Production capabilities/capacity?
 Inhouse/Outsource/ Bottlenecks,
TQM
 Relationship w.r.t to suppliers? Vs
PLC
WCS (What constitutes success?)
 Which metric to use?
PESTEL Analysis (Non-market)Risks
 Barriers to entry/exit?
 Political-Stable/volatile
 Economic-EDB, IR, Tariff, Exchange
rate, Literacy, UER, systematic risk,
 Social-Culture
 Technological-innovation, tech
 Environmental-PCB, NGT, activism
 Legal- contract enforcement, IPR
SCM
 Sourcing and Distribution channels
and alignment with the customer
 Bargaining power of Suppliers
 Bargaining power of buyers
Profit and Loss Question
Economy/Environment P = R- C Market / Industry
 GDP and its Growth rate  Who are they? Same as above
 Inflation  What do they do?  Industry
 Unemployment rate  What are their products?  Competitors
 Disposable income • Market leader?  Customers
 Consumer confidence  Size in terms of revenues  Collaborators
 Saving and spendings and profits, public or  SCM
 Interest rates and private? (Ask for 3 years.)  PESTEL Analysis (Non-
Financial markets • Products or services? market)Risks
 The dollar’s strength in • Product mix?
the currency market • Revenue mix and trends?
 Raw material and • Customer segmentation?
Commodity prices  WCS? (What constitutes
 Energy prices incl. MS success?)
 Freight rates  Revenue = Quantity x
 Exports and Imports Price (Price elasticity of
 Environmental causes- demand)
CC/Monsoon etc  Costs = (Quantity x
Variable Costs) + Fixed
Costs (bench mark?)
ST and LT solutions to raise profits
1. Revenue-based strategies
 Customers PLC Check and 3 horizons FW/ Ansoff matrix
 GTM -Pricing, Channel, and Positioning Check and Brand Loyalty
2. Cost-based strategies
 Production-RM/WIP/FG/OM/SCM
 Labor
 Finance-Refinance debt, hedge and Selling assets
Entering a New Market
Introduction
 "Why does the company want to
enter this market?"
Step 1: Company Analysis
 financial performance over the last
three years
 product mix and its potential impact
on existing products.
 customer segmentation and the
feasibility of using current
 distribution channels and sales
force.
 Production considerations-location
and workforce requirements.
 Strength of the company's brand
and its market leadership status.
 Define the criteria for success.
Step 2: Market Analysis
 The size & GR of the current market
 Industry's life cycle stage
 Segment the customer base
 The role of technology industry.
 Competitive landscape -product
differentiation.
 Pricing strategies and the Threat of
substitutes
 Barriers to entry
 Exit barriers and risk factors
Step 3: Assessing Market Entry
 Evaluate competitors and their
market share.
 Compare your products with
competitors and formulate pricing
strategies.
 availability of substitutions and any
potential exit barriers.
 Analyze risks associated with market
entry, such as regulatory changes.
Step 4: Market Entry Strategies
Consider four major market entry
strategies:
1. organic growth,
2. acquisition,
3. joint ventures/strategic alliances,
and
4. outsourcing.
Perform a cost-benefit analysis for each
strategy to determine their pros and cons.
Recommendation
 Clearly state the recommendation:
"Yes” or "No”
 Provide reasons for the
recommendation.
 If recommending not to enter,
suggest alternative plans and
emphasize how you can assist
MERGERS AND ACQUISITIONS-decisions are driven by the goal of increasing shareholder
value and the compatibility of organizational cultures.
1. Private Equity Buyers
 Why does the private equity firm
want to acquire the target
company?
 What else is in their portfolio, and
how does this acquisition fit into
their broader strategy?
 What are their intentions with the
target company (hold, sell, or break
apart)?
 Recognize the potential synergies
within the private equity portfolio
that might be overlooked.
2. Strategic Acquisitions
 In cases where one company is
acquiring another, consider not only
the "why" but also the broader
context:
 Why is the acquisition taking place?
 What other products or services
does the acquiring company offer?
 the synergies that will result from
the acquisition to ensure it aligns
with the company's business
objectives.
3. Reasons to Purchase
 Expanding market access, boosting
the brand, and increasing market
share.
 Diversifying the company's holdings.
 Preventing competitors from
acquiring the target.
 Target company as a strategic
threat.
 Gaining access to management
talent.
 Obtaining patents, licenses, or
products.
 Realizing synergies, cost savings,
cultural integration, expanding
distribution channels, and enlarging
the customer base.
 Gaining tax advantages.
 Increasing shareholder value.
4. Due Diligence
 The target company's financial
health, management, product
offerings, profitability, and brand
value.
 The target's stand-alone value and
growth trajectory.
 Market stability, customer
relationships, and supplier security.
 Margin structures (high volume, low
margin, or low volume/high
margin).
 Industry performance and the
target's position within the industry.
 Competitors' responses.
 Legal issues that may affect the
acquisition.
 Potential technology-related risks.
 The acquisition cost and ensure it
aligns with value.
 Confirm that the buyer has sufficient
financial resources or access to
capital markets to fund the
acquisition.
Pricing Strategy
Introduction
 pricing strategy - the company's
objectives, product positioning, and
market dynamics.
Step 1: Investigate the Company
 company's size & role invmarket.
 pricing objective: Is the primary goal
to maximize profits, gain market
share, or establish brand
positioning?
 whether the company sets prices
independently or reacts to market
conditions and competitors.
Step 2: Investigate the Product
 Compare Company product with
similar products in the market.
 Evaluate where the tablet is in its
product life cycle (e.g., introduction,
growth, maturity, decline).
 The presence of substitutes or
alternatives.
 Any supply-and-demand dynamics
that might affect pricing.
Step 3: Determine a Pricing Strategy
 Explore three primary pricing
strategies:
 competitive analysis,
 cost-based pricing, and
 price-based costing.
Competitive Analysis
 Assess the competitive landscape
and how Company’s product
compares to rival products.
 Gather information on competitor
pricing, costs, and the presence of
substitutes.
 Predict competitive responses to
different pricing strategies.
Cost-Based Pricing
 Calculate all costs associated with
producing the tablet and add a
profit margin.
 Determine the breakeven point,
which is essential for cost control.
 Note that cost-based pricing might
need adjustments if market
conditions change.
Price-Based Costing
 Understand what customers are
willing to pay for the tablet.
 Assess the tablet's perceived value
to buyers.
 profit margins specific to the
industry.
 Compare the product's value to
other products or services in
customers' lives.
 Partition pricing, which involves
charging separately for specific
features or services, can complicate
pricing strategies.
 Consider industry norms and
customer expectations when
deciding whether to bundle or
separate costs.
Growth strategies
 When focusing on sales growth, the
primary goal is not necessarily profit
maximization; it's about increasing
volume or revenue.
Step 1: Learn about the Company
 Understand BBB Electronics' current
size, available resources, and
product offerings.
 Identify the company's objectives
and any past trends in sales growth.
Step 2: Investigate the Industry
 Analyze the lightning rod
distribution industry and how it's
evolving.
 Compare BBB Electronics' growth to
industry trends and assess pricing
competitiveness.
Strategies to Increase Volume/Revenues:
1.Expand Distribution Channels:
 Broaden the number of distribution
channels to reach a larger customer
base.
2.Diversify Product Line:
 Introduce complementary products
or services that won't cannibalize
existing sales.
3.Identify High-Potential Segments:
 Analyze business segments with the
highest future growth potential and
profit margins. Focus resources on
these areas.
4.,Invest in Marketing:
 Launch effective marketing
campaigns to raise awareness of the
K6 double-prong lightning rod, its
benefits, and BBB Electronics as a
reliable distributor.
5.Consider Acquisitions:
 Evaluate acquiring competitors in
the industry, especially if the goal is
to increase market share.
6.Price Adjustments:
 Modify pricing strategies based on
customer price sensitivity. Lower
prices to boost sales volume, and
consider raising prices to enhance
profit margins.
7.Create Seasonal Balances:
 Implement seasonal strategies to
sell products year-round. For
example, diversify the product line
to match seasonal demand or
promote different product features
in various seasons.
8.Explore Niche Markets:
 Investigate emerging industries with
high barriers to entry. BBB
Electronics can carve a niche in such
markets, enjoying less competition
and higher visibility.