- Thème:Strategic benchmarking
- Secteur:Industrial products
Issue
AMR International’s client (‘C’) had a large market share of the global metalworking industry and was believed to be without serious competition in Europe. However, C wanted to assess the position of one its competitors, (‘X’), who had entered C’s market years ago but was believed to be in severe financial trouble due to the economic downturn and historically lacked the technological know-how to become a significant competitive threat. Recent market rumours suggested that X had managed to improve its technology and that it could become a potential threat to C if it survived the downturn. C asked AMR International to assess X’s true market and financial position and make recommendations regarding the mitigation of any risks that may be revealed.
Approach
AMR International had extensive experience in C’s sector, gained through numerous prior projects and had industry insights and contacts that it could rely on. A carefully planned and executed interview programme was conducted by AMR staff to ascertain X’s financial position, technological ability, and future market plans. In order to tailor the interview programme to C’s needs and to ensure the best possible preparation, the programme was preceded by a general market analysis with a focus on trends and developments in the market.
Results
AMR confirmed that X was about to become a serious competitor and that a loss of market share for C appeared inevitable if no action was taken. X had obtained sufficient funding to secure its survival and had completed almost all necessary investments to start production of its new line of technologically-advanced products. Customers perceived X’s new products as competitive, and were very keen to establish X as an alternative to the hitherto dominant C. As a result, X had already won contracts from the majority of potential customers.
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Recommendations
AMR suggested several options to mitigate the threat posed by X, including the acquisition by C of X or one of its key suppliers. Other, less drastic options were directed at improving C’s product portfolio, R&D approach and services as suggested by existing and potential customers during AMR’s interview programme.