on Danielson Designs
Initially, Danielson Designs is an American manufacturing company in the segment of home décor and interior decoration. In order to evaluate it precisely, I would turn to the SWOT analysis.
Let us observe the strengths of the company. At first, Danielson Designs is a family run business where the management is proud of its history and traditions. An enterprise started as a small shop and improved its size and scale significantly. Possessing good intentions and wishing a better life for the town where the family lived, the family members could create a growing and prosperous business. At second, Mark and Annie Danielson always emphasize on the “Made in the USA” label as one of their competitive advantages on the American market. They feel themselves patriots and stress on the spirit and traditional style.
At third, they implemented a certain type of protection for each produced piece when they switched from hand craft to technologic manufacturing. One may call it a specific identification that increases the uniqueness of the products. In addition, the company is an award winner (http://danielsondesigns.com), and this fact reflects positively on its reputation.
Danielson Designs has a solid market share producing a rare type of products – signs and wooden picture frames. In synergy with the previous characteristics, one may also define this as strength. They treat themselves as a design firm and this approach allows staying competitive and offering innovative products to the market. Copying is not their style, so that’s where the product uniqueness comes from.
Finally, Danielson Designs is environmentally committed enterprise. The environmental concern is very popular and trendy nowadays in the North America and Europe. More and more firms and individuals are willing to contribute to the nature protection, that’s why they are willing to purchase environmentally friendly goods.
So that I have listed the strengths of the company, I would like to turn to the weaknesses as the next step in the analysis. At some point at the beginning, Mark and Annie promised that they would not grow the company at the expense of the family. But the competition and globalization shows that successful are only those who are fully committed to their jobs. One may not certainly define this as a weakness, especially when talking about the family business, although a manager should always take into consideration the amount of time spent with the family and at the working place.
The usage of certain raw materials is also a weakness. Wood is a rather expensive material, besides it is not as popular nowadays as smooth plastic and metallic surfaces. As a result, people interested in hi-tech designs will not most probably be the customers of Danielson Designs. The more the technology becomes sophisticated, the less market share the company has. At last, those observing the company online may find the website difficult enough to operate due to some disorder.
Company’s opportunities are limited with its own approach. Adjacent markets are the perspective ones, though an unsuccessful attempt to enter furniture segment has already taken place previously. According to www.danielsondesigns.com, the company is committed only to the local community which appears to be their primary operational environment. If the management is ready to widen the scope of activity, the geographical expansion of the firm can also show growth. In addition, the outsourcing manufacturing of the products in the countries with cheap labor can minimize expenditures and allow the company to go international. The base for this is the innovative approach and the designing skills within Danielson Designs.
One may also take a thorough look at other expansion opportunities. Perspective segments may turn into new businesses. Besides, Danielson Designs can establish a non-profit organization aimed at bringing benefit and prosperity to Colorado as a land or an administrative unit within the country.
Innovations and permanent improvement in product lines are the unquestionable opportunities. This was the tool that the company managed to use successfully in the past, and it must bring profit in the future. Even if wood is not so fashionable anymore, American households still tend to have bulky wooden interiors, so the products can still fit in the surroundings.
Now I will cover the possible threats of the given business. Now the company is in a highly competitive market, both local and international. Manufacturers from China offer the market almost the same quality of the products but for the lower prices. The expansion of Chinese goods is obvious and inevitable. The only way to escape is to differentiate and choose the most appropriate segments and niches where the company will have high performance and strong competitive advantage.
When looking through the website (www.danielsondesigns.com), one thing strikes an eye: it is not easy to find the patterns of the products the firm offers. The website has an overflow of the information and no structural reasoning. I would prefer such a website have less words and more pictures, incorporate modern engines for color and text modulation, and stick to a uniform decorative design. Nowadays creative approach dictates flash animation for the websites. It is not used by Danielson Designs so their corporate website does not look up-to-date.
Taking into consideration the fact that Danielson Designs may choose internet as a primary channel to sell the products, one may find it complex for the company to attract clients with such a complicated website. So, online presence for the company may not add value but rather deter customers. This is one of the risks the company faces nowadays. Among other risks, there is an obvious risk of substantial loss in the market share because of the high competition rates in the industry. Competitors now manage to produce cheaper analogues due to the usage of artificial raw materials, much higher production capacity, and cheaper work force. That is how they provide higher turnover and a bigger market share as a consequence. Now it is hard for a common consumer to distinguish, which product is qualitative and which is not. The biggest risk for the company is when the similar products of the competitors are not only cheaper but also of the same quality. That’s why Danielson Designs has few options: either diversify to a higher price segment or outsource production while expanding globally. Otherwise, the firm will operate only locally in the area where it started many years ago.
Concluding the aforementioned, I would like to say that the case of Danielson Designs has something in common with the Dell’s story. The website of the firm allows customization for each product and offers this possibility online. According to the business model, the orders are taken, processed and distributed easily and quickly. These are the foundations for the strong direct channel distribution. If the company decides to stress on the e-commerce, it can improve positions in terms of the industry with the advantages it already possesses. They are: the quality of the product, its value, warm approach and customer care, simplicity of the order, speed of production and delivery, possibility to customize, offering small shipments. These are also the advantages that separate the company from the foreign competition. The reason is evident: internet-based business creates new possibilities. Emphasizing on US manufacturing, the company can maintain a higher price level compared to the Chinese rivals and not be associated with them anymore. Becoming a partner of an American or a worldwide network of supermarkets, which delivers household products and utilities, as well as furniture, décors, or interior solutions, can ensure the company’s position in the market. Then the company will probably have stable wholesale orders and be closer to the adjacent markets and segments.
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