Our companys main business line is sports equipment. And our target customers are middle school and high school kids who play youth sports. Our company aims to provide products which are fair in both quality and price instead of high-end equipment or equipment for professional athletes. Some well-known companies like Nike, Adidas and others are feeling the pressure because customers prefer the bargains and sales. It is a piece of good news for our company because our products meet customers needs.
However, I found the costs of every items our company produced are about 5 times more than the industry average, which means although the number of our selling is more than other company, our production costs are higher as well. Therefore, we are supposed to do some measures to increase sales and reduce costs as the same time.
Just as I talked about above, there are lots of well-known competitors in the market.
Even though many people hunt for bargains and sales, a huge number of people still look for the quality and comfortability of the products. Those well-known sports company can build their own brand value in such competitive environment because they do meet customers satisfaction. Therefore, our products have to focus more on quality and comfortability. Whats more, we are supposed to listen to customers voice and to follow up the trends. Nike, Adidas and other competitors will release new products every season which fit new trends. Our company should make more efforts on creativity and innovation to make sure our products have selling points and can catch customers eyes.
In addition, I found most of the competitors produce in low labor-cost countries in Asia, and their production costs are much lower than ours. It is a key point to reduce the production costs. We can try to find a location in Asia where the material costs and labor costs are much lower than the United State to build our own production factory. We may increase profits because we have our own factory in Asia with lower wages and costs. Whats more, our design department can take the renewable materials into consideration. Renewable materials are not only environmentally friendly but also help our company save a lot of budget.
More seriously, our company like many others is facing a dilemma that we are feeling stress to make as many of our products as possible. The current political trend encourages us to outsource because tax and tariff charges are being threatened for those items and supplies are imported. Our company may increase profits by outsourcing to countries with lower wages and costs. Moreover, the number our customers will increase once we start outsourcing. More importantly, we have to think about the effects the current trends in nationalism bring to our company. Gideon, the author of the article states that once you start thinking of outsiders as less worthy than your compatriots-indeed, as people who infest your nation-then it becomes much easier to treat them brutally. (R. Gideon, Financial Times, June 25, 2018). Nationalism affect business growth because such policy reduces opportunities in global market. One of the most important factors of economy is skilled labor force, but the current trends in nationalism lead to skills and people shortage. In our country, nationalism brings many current and potential challenges such as problems of immigration. And it shows the characteristics of isolationism and protectionism. Despite the increased nationalism brings many challenges, most countries still can find a good way to manage immigration and the need for skilled labors. I also believe our company can do much better and have a bright future!