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Threats

Extracts from this document...

Introduction

Strength * Strong distribution network By examining the Daisytek's overall operation, one of it strength obviously revolves around the effective distribution network, where the company considered itself as the world's largest leading distributor of computer and office automation supplies and accessories. This undoubtedly is the product of its proficient distribution center, in which the productivity, service and error were vital concept in the discussing the performance of the department. Moreover, its execution rate is believed to be faster than other distributors in the same industry. For instance, the distribution center is committed to distribute all of their orders before the end of the day. Consequently, 99.5 percent of orders were shipped on the same day the order took place. Additionally, Daisytek operates its business on its globally networked system, which provides the company the ability to sell the products in from one country to another, such as from Plano to Australia or from Mexico City to India. * Strong strategic agreement with Federal Express One of the most valuable strengths Daisytek possesses is its strategic alliance with Federal Express. This agreement is a mutual benefit to both parties, in a way that it offers the bulk constant volume for FedEx, while providing proximity and lower fee in the advantage of Daisytek. Consequently, the agreement is partially contributed to the ability of Daisytek to compete on cost basis with its major players in the industry. Additionally, on the customer's perspective, while the company is able to perform the operation at a lower cost, it is also capable of brilliantly satisfy the customers with faster service with promising quality. * Technology advancement In addition to Daisytek's strength from the alliance with FedEx, the company also gains numbers of advantages due to its first-rate technology advancement, where its profit margin is the result of effective application of technology. This strength is extremely crucial to the survival and growth of Daisytek due to the nature of the office supply and computer consumable industry, where products is like to become obsolete, resulting in high dependent on new technology introduction. ...read more.

Middle

Thus, Daisytek often emphasizes on the service quality and technology of the company as a competitive advantage. Therefore, in order to increase their profit margin, the company would derive its energy towards effective use of technology to drive down the cost rather than increasing the price. * Bidding of PFS For PFS, the pricing strategy is relying heavily on the appropriate bidding proposal because it is one of the factors that the customer needs in making the decision whether to use PFS or not. Therefore, it is important that PFS comes up with the reasonable and attractive bidding proposal to gain more customers. Place * Global network system With the state of being the world's leading distributor of computer and office automation supplies and accessories, the distribution of Daisytek is considered to be one of it strongest edge in its business, where the company maintains effective globally networked system. This system allows Daisytek to distribute its products to countless countries around the world. Promotion * Relationship marketing Due to the characteristics of being a distributor for office supplies and computer consumables, Daisytek does not emphasize on advertising or marketing campaign, partially because the majority of its customers are independent business resellers. Therefore, the company does not invest a lot of effort and time in marketing its products and services but rather on mutual benefit relationship marketing, which emphasizes on building the relationship with the customers to gain customer loyalty in a long run. Management Critique * CEO has a respectable business mind Concerning the management aspect of Daisytek, Mark Layton, the president and CEO of the company, portraits an impressive business mind, where he is capable of developing as well as organizing his business in an effective manner, which contributes to the rapid growth of Daisytek. * Understand the nature of business In addition, he also has a comprehensive understanding of the office supply and computer consumable industry. ...read more.

Conclusion

In addition, these manufacturers are mostly technology-based, in which the company's expertise lies. Thus, in reaching these customers, it is much easier and appropriate for the line of business the company is presently operating. Once the company gains more experience, credibility and visibility in the market, it can expand the customer base to other segment, such as e-commerce, which has no expertise in the area of distribution network. 2). * Maximize value of Daisytek for future sell-off Although PFS is estimated to bring in much higher profit margin compared to existing Daisytek products, currently the company is heavily relied on the revenue of those product lines. Therefore, it is impossible to solely and immediately pursue the new outsourcing business. The potential solution is to maximize the value of Daisytek by maintaining and if possible, expanding its customer based. Eventually, when there is a well-presented opportunity, Daisytek could sell off the traditional distribution business to a potential buyer. * Customer relationship management Daisytek could expand their customer based by focusing on customer relationship management, where the company will focus on creating and maintaining relationship with the customers. This means that the activities in the organization at would be emphasized primarily on satisfying customer's needs, leading to customer loyalty. CRM is important in maximizing the value of Daisytek because since the main operation of PFS would require the existing facility, those assets obviously could not be sold to the buyer. Therefore, it is vital for Daisytek to maintain good relationship with the current customers as well as continually expanding its customer-based. In conclusion, by putting its energy towards CRM, Daisytek would definitely establish customer loyalty and brand equity, which in turn could be attractive offering for the potential buyers of Daisytek. There are other significant assets that could be worthy in the eyes of the prospect buyer, such as customer list, strong relationship with suppliers, brand equity, agreements Daisytek possesses in the benefit of the company and leading-edge technology. ...read more.

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