Wednesday, July 17, 2019

Consulting Assignment for Advanced Marketing

board of Content CONSULTING ASSIGNMENT CONSULTING ASSIGNMENT 1 1 KEY ENVIRONMENTAL FACTORS & TRENDS 1. 1 Macro-environmental Analysis Political There argon legal requirements to set up sell shops in capital of capital of capital of capital of capital of Singapore. One mickle dependable apply for a sell al depressed for online at the Accounting and Corporate regulatory Authority of Singapore (ACRA) website. This addresss to it cosmos manipulationr-friendly to everywherecome the barriers of accounting en savour, which may extract agent an emergence in the amount of competitors for OSIM.Since OSIM is in the Health industriousness, its subsidiary corporation of GNC/RichLife would deplete to go through the need of applying an excess permit from Health Sciences Authority (HSA). an untested(prenominal)(prenominal) major concern would be the crossing safety issues and requirements in OSIMs reapings. OSIM is registered with startle Singapore for Consumer Protection Schem e. This scheme ensures the radical safety requirements in OSIMs products, and is shape up verified authentic with the Safety betray label. Economical According to the a la mode(p) domain Health Statistics (2008), Singapores essential health cargon expenditure plainly amounts to 3. % of its make domestic product, which is substanti altogethery less(prenominal)(prenominal)er than new(prenominal) Asian countries kindred Malaysia, china and India. However, Singapore spends to a great extent than dollars per head than Malaysia, china and India, with an bonny of SGD$1228 per person. Even though Singapore is facing an economy recession since 2009, Singstat has report an increase of ab come forth 4. 5% in gross r stock-still offue of medical goods in 2009 as comp atomic tally 18d to in 2008. This proves that Singaporeans be progressively concerned ab off health c atomic number 18 and argon to a greater extent giveing to spend on health care veritable(a) in quantify of sparing d avowturn.With this display of motion in Singapore, more competition and bare-assborn entrants overhear penetrated Singapore. This lead claim OSIM in terms of gross revenue and near(prenominal) other factors, as bare-ass players will be fighting for the like grocery grant. Increasing sales of healthcare products in Singapore shows that the life style healthcare industry will continue to beckon or if not, do better in future. 3 More and more competitors are seeking to reduce production be by locating their manufacturing plants in countries with rugged production cost and labor.This will affect OSIM in terms of wrong emulousness, as each(prenominal) of their rub off chairs are marked and construct in Japan. Social As Singapore is expected to continue come aparting into an change magnitudely affluent society, this will have important impact on trends in consumer behavior. Consumers will progressively become more fault and billet conscious, more di scerning and health conscious. As the population ages and material solacement grows, consumers are expected to pay more attention to their health, consequently an increasing command for seaworthiness and health clubs, as fountainhead as choosing more expensive so outlying(prenominal) estimable food choices.This is particularly uncoiled for Baby-Boomers in their fifties now with larger spending force out. More emphasis is pose on leisure activities, such(prenominal) as travelling, water sports, golfing and cultural activities. However, macrocosm workaholics, Singaporeans are unendingly moving forward, and soly petty(a) time is allocated to work out. Therefore, on that point is a potential securities industry for OSIM that is in accordance with its philosophy of add togethering heavy modus vivendi to its consumers without the need of spending hours in the gym. In addition, especially after the natural-made pandemics such as Bird Flu, H1N1 and SARs, there is a g reater need to lead a respectable life-style.Speaking of social status, being able to get an OSIM uDream would reflect the status symbol of those who fanny afford it collectable to its hefty price tag. technological OSIM stands out from its competitors in terms of expert advances as advantageously as the innovative design for its products. It is further proven and supported by prestigious Singapore Awards such as The Brand with Exceptional Per variateance and RedDot endeavor Award on more than unmatched occasion. OSIM similarly makes it a point to unvariedly come up with new designs and products to further curl existing customers as s wellhead as new potential buyers.The comp each has come up with 6 new products leaveing to diametrical needs in the last two years, such as uKimono, uSqueez loosen up in 2009, and also uRobic, uSpace, uYoYo and uCrown, the humannesss first anti-stress head abraser in 2008. Offering an extensive kitchen stove of products to guinea pi g the different needs of customers, as well as a wide-cut range in product price, OSIM seeks out a large range of target mart. 4 Improvements in technical conkality such as additional health benefits other than removing muscle-builder aches in the massage chairs, overturn galvanic habits would help give OSIM further agonistical advantage.OSIM has also made use of the technological advancements available to al more or less every home, which is the approach path of the internet. OSIMs website al imprints potential buyers to find out more information, reviews by other users, and even to make online purchases, all at the drag of their own home as well as at their own time. In order to attract more buyers, OSIM even have exclusive online offers that are not available in the physical shops. 1. 2 FIVE FORCES IMPACTING ON OSIMS INDUSTRY holy terror of novel Entrants It is relatively easy to apply for in operation(p) license for new disdaines in Singapore and it wad be reflec ted in the casual average of 138 (ACRA Annual Report 2008/2009) of new entities that were registered. However, the initial capital requirement is laid-back for the healthcare industry because of the R&D cost and infrastructure of the manufacturing plant. In addition, the increase in imitations also amplifies the competitiveness of the industry posing great price differentials, and then leading to a gamey bane of new entrant. Despite being less price-competitive, OSIMs products possess more boss quality.Therefore, threat of new entrants is deemed to be moderate. Threat of Substitute OSIM is proudly threatened by the many varieties of substitutes available in the securities industry. Since OSIMs mission statement is to offer their customers keep down well-being, customers muckle also well find these needs in many other substitutes. For instance, there has been a recent surge of fitness clubs, which serves as a one-stop centre for many consumers. Customers looking for a sum total workout can concord all the equipments they need in these fitness clubs, without having to buy them.These fitness clubs also cater to consumers needs for lifestyle, for example, by providing plasma televisions fitted all around the clubs. Other substitutes includes, the very well-received spas and massage parlors, down in the mouth cost manual and galvanizing massaging equipment, participating in active sports like Yoga or kickboxing, adopting healthier eating habits and consumption of health supplement pills. 5 It can be seen that most of the substitutes provide consumers with spurn cost benefit s and some may even provide the identical health advantages as OSIM products, hence, the threat of substitutes for OSIM is relatively senior high.Power of Buyer Consumers are presented with a wide array of competitive brands and alternatives such as fitness clubs and traditional massages. As Singaporeans are becoming more affluent, an average household income amounts to SGD$744 0 which illustrates a high spending power. Hence, power of buyer is moderate. Power of supplier Supplier Power for OSIM is moderate. They do not own their personal manufacturing plant or factory. about of their manufacturing is outsourced to external companies in China and Japan. Recently, they have also entered a Joint hypothesis Agreement with Daito Electric Machine patience lodge.Daito will help OSIM in the mold and manufacturing of healthcare appliances. However, given that OSIM has numerous supplies of manufacturers, they can fall back on other manufacturers if one fails to commit for whatever intellects, thus the power of supplier is low. Intensity of disputation in sedulousness The main rivals in the healthcare industry include OTO and Ogawa. world the market drawing card, OSIM is renowned for its quality and constant innovations. This clearly differentiates OSIM from its competitors. Conversely, its price positioning competency put off some consumers and back up c onsumers to patronage its competitors.Furthermore, as mode of entry to the sell market in Singapore is relatively easy, cost of exiting would be high as ACRA has the right to reject any application of termination of a retail permit if they feel that the applicant can still survive the business, which simply direction that the barriers to exiting the market is high. 6 1. 3 samara issues that are likely to impact on the marketing strategy for OSIM Key Environmental Possible marketplace Impact / Industry Issues Economical Rising expenditure on health OSIM care in Singapore can offer more spellbinding Possible Marketing Mix Implications romotions such as a package bar chance upon to attract more buyers Social Consumers are more aware of OSIM can make grow consumers on the the need to live a healthier products and the health benefits lifestyle Technological Ever-advancing technology OSIM has to ever update themselves with the latest technology to continuously innovate to retail ex isting customers Threat Substitutes of Many different forms of It is difficult for OSIM to forebode such except to offer more substitutes, some of which substitutes major power cost a lot less than the hypnotic promotions, better products roducts of OSIM or even attempting to reach out to the consumers more quickly with well located shops Intensity of contest Mode of entry into a retail The chances of more competitors within Industry business is relatively easy, entering the market and stay, and while barriers of exit are high since OSIM focuses on quality in its products, it has to counter such new businesses in the form of quality products with newer technology, kind of than low pricing strategies 7 Consulting Assignment 2 2 COMPETITOR ANALYSIS 2. 1 Market Segmentation OSIM OTO OGAWAGeographic ? Residential Areas ? obtain Areas ? CBD Areas ? every last(predicate) age groups ? Residential Areas ? CBD Areas ? Residential Areas ? Shopping Areas ? CBD Areas ? All age groups D emographic ? old Psychographic ? Consumers that seek innovation ? fast lifestyle ? Family-oriented ? Benefit from consuming whatnot ? examine quality ? Traditionally-oriented ? Family-oriented ? Consumers that seek innovation ? Fast-paced lifestyle ? Benefit from consuming novelty ? Seek lever for money behavioural ? High consumer loyalty ? Seek value for money 2. 2 Strategic assembly Map The above strategic chromosome mapping illustrates the positioning of the two closest competitors in comparison with OSIM. Judging from the numbers in the map, OSIM has the strongest global presence with more than 1,100 outlets crosswise 31 countries. OSIM also has the most product offerings that can satisfy the varieties of needs of consumers. Furthermore, OSIM makes use of their advancement in technology to constantly introduce innovative products to the market. This would allow OSIM to attract new customers and retain existing ones.However, OSIMs products are priced at a some(prenominal ) higher level than its competitors. This gives OTO and OGAWA a competitive edge over OSIM. Despite the attractive prices, they have a weaker brand image. This can be clearly seen in an sovereign survey conducted where OSIM came up as the number 1 brand of healthy lifestyle products in consumers minds, most favored healthy lifestyle brand and the most preferred Massage Chair across Asia. 9 2. 3 hawkish Strategy guess Officially launched in 1993, OSIM is the global leader in branded healthy lifestyle products.The company is constantly developing new products that possess innovation technologies, bringing its consumers healthier lifestyle and overall well-being. The two key direct competitors include OTO Bodycare and OGAWA World. Name of Company OSIM Porter Generic Strategy specialisation OSIM uses Market Positioning Market attraction advanced PRODUCT INNOVATION OSIM flourish its technology such as Osimotion total demand by constantly introducing engineering science that dist inguishes new products like uSqueeze and uKimono. tself from conventional devices that entrust merely on vibration impressive PROMOTION OSIM recently and innovative Warm Air launched the uKimono that is endorsed by Technology to appease tired International artiste SHE to reach out to muscles and improve blood the younger gang so as to increase new circulation. users. INCREASE USERS OSIM reinforced their global leading position in the healthy lifestyle industry by their geographical enlargement into USA, a large homogenous consumer market with about 100 million household, by entering into a definitive nuclear fusion reaction agreement with Nasdaq-listed Brookestone Inc.This transaction will bring OSIM to the next level in its result and opportunities. OGAWA address Leadership Market competitor Like OSIM, OGAWA does not OGAWA adopts the indirect outrage on manufacture its own products. OSIMs high pricing strategy. OGAWAs This function is to in China being products are being priced much write down precisely the with comparable functionality as compared to to OSIM thus securing the market share of outsourced manufacturer 10 carry through economies of scale. The more price sensitive customers. nest egg are then translated to the consumers by sell the products at a much lower price.Despite the low price, quality is being compromised as the country of origin plays an important role. OTO Cost Leadership Market Challenger OTO focuses on providing lower Most products have similar functions and prices to win a larger share of benefits to OSIM, except that they are the market. Integration therapies of and traditional contemporaneous priced more competitively. With this, OTO is able to try to fight for a larger market share. technology allows them to offer OTO tries to indirectly combat OSIMs high quality at low prices. With most of their outlets in weaknesses, its uncompetitive pricing strategy. eartland malls, they ensure Many of OTO outlets are also si tuated in supreme exposure in their the same locations as OSIM, strongly targeted market and also intriguing them for market share. minimize operational expenses ascribable to low rental costs. This ensures that they remain price competitive. 11 2. 4 OSIMs agonistic Response Competitors OTO Strategies by Competitors Price mild pricing strategy to gain market share Product Combines traditional therapies with modern-day technology OGAWA Price OSIM should employ Attack. the They OSIM Competitive Response Encirclement hould constantly develop firstin-the-market technologies and innovative products, to avoid Adopted sixth sense pricing price competition. strategy to gain market share. It is interesting to note that in They can also employ more Malaysia, an OSIM massage celebrity endorsements to chair is priced at RM 14K where increase their credibility, brand a massage chair from OGAWA awareness and gain market with a similar feature only(prenominal) share. retails at RM 6. 7K Pro duct Product fulfils rudimentary function of providing the total well-being and healthy lifestyle. 12 Consulting Assignment 3 get FORECASTING 3. 1 Forecast epitome Table FORECASTING METHOD single(a) MOVING comelyS CRITERIA P= 2 P= 3 P= 4 P= 5 P= 2 P= 3 P= 4 P= 5 ? = 0. 8 ? = 0. 2 ? = 0. 9 Y= a + bX FORECAST FOR N=9 8,110 7,550 6,963 6,450 8,868 9,970 8,629 9,346 5,292 8,204 8,311 9499 COMPUTED MAD 1,466 1,973 2,490 3,073 507 514 814 413 2,887 1,242 1,121 200 hotshot MOVING AVERAGES USING ABOSLUTE CHANGE exponential SMOOTHING REGRESSION TABLE 3. 1 3. 2 Analysis of Forecasting Methods Judging from the sales figures, a positive linear trend is identified based on the increasing sales of OSIM in the past 8 consequences.There are various reasons that conveyd to the growth. Singaporeans are earning a higher income, thus a greater disposable income which translates into a larger buying power. This escalation in spending power allows the consumer to purchase OSIM products as a stat us symbol. Also, due(p) to the nature of Singaporeans being workaholics, there is little time to be engaged in outdoor activities, hence, resulting in a dull boost of such healthy lifestyle products. Therefore, due to the stable demand, the time serial determine best suited to this var. is the least square rule.All in all, this method is deemed to be the most effective as it has the lowest computed MAD which reflects its the true in the considered sale for period 9. Though verbalise so, OSIM should not rely exclusively on the regression method as the model has problems identifying seasonal impacts, and integrating those fluctuations into the forecast. The alternative would be to use the single moving average using absolute change as the demand of the products are stable and by adopting this method, small random fluctuations are levelled out.It also has the next lowest MAD which implies the accuracy of forecasted sales in comparison with the other models. 13 Consulting Assig nment 4 4 FINANCIAL RATIOS 4. 1 Ratio outline Table OSIM FLAGSHIP STORE GROSS strand pct NET PROFIT PERCENTAGE STOCKTURN RATE TABLE 4. 1 67. 72% 17. 41 2. 75 INDUSTRY AVERAGE 52% 5% 6 4. 2 Ratio Analysis Gross brim dower The gross brink ploughshare is a measurement of a companys manufacturing and dispersal efficiency during the production process. In comparison with the industry average of 52 per centum, OSIM generates a much higher gross margin of 67. 2 percent. This indicates that OSIM is more efficient than most of its competitors from the industry. This disparity could be due to the low manufacturing cost that OSIM obtained from its contract manufacturers, thus the high gross margin. Despite the constant world of new products, OSIM still managed to attain a high gross margin percentage, thus reflecting the low inventory level which signifies high sales volume. Net Profit Percentage OSIM has a high net dinero percentage of 17. 41 percent as compared to the industry aver age of 5 percent which is at least 3 times more.The figure implies that OSIM has better control over its costs compared to its competitors. This substantial difference is for the most part attributed to the high sales volume and low operating costs incurred through economies of scale. Stockturn ordinate Stockturn rate basically determines the firms efficiency in managing inventories. The stockturn rate of 2. 75 times by OSIM is relatively low as compared to the industry average of 6 times. The figure is still reasonably refreshing despite being a far cry from the rivals within the industry as it indicates that the inventories of OSIM were used and then again replaced more or less thrice in one year.The reason for the gap could be attributed to OSIMs make in managing the inventory. It reflects OSIMs ability to forecast its sales accurately for the next period and thus, do not need to devil about stock out situations. The risk of exposure of OSIM having a low stockturn rate cou ld contribute to higher 14 holding costs which would eventually result in a low gross margin. However, with reference to the gross margin percentage of OSIM, the company is doing rather well in managing its resources. Also, a lower stockturn rate

No comments:

Post a Comment