Currently, Leatherworks (a New Zealand owned and operated company of over 40 years) is at an impasse of where to go with their business proceedings. With an ever changing external environment, an overload of product offerings and an unclear focus of where to go next, Leatherworks is looking for advice. This report looks to outline a way in which Chris Pickering, the owner of Leatherworks, can change his strategy in order to focus on more specific target segments and increase his annual turnover from $1million to $10million by 2020.
A thorough external analysis uncovered that opportunities lie in producing sustainable products for a more ‘green concerned’ public whilst also remaining in the architectural market where lucrative jobs can be captured. Further research uncovered that threats to the leather/textile industry include cheap imitations and a growing sympathy for the plight of animals. In terms of the leather fashion industry - the New Zealand market alone can be considered a red ocean for Leatherworks, with a number of fierce competitors who have captured much of the available market share and desired customer base. Leatherworks’ strengths are that they are New Zealand made (giving an aura of ‘clean and green’), and their factory is very nimble and adaptable. They do however have many weaknesses ranging from a poor online presence to a lack of strategic direction which has lead the business to somewhat stagnate.
After careful consideration, we chose to advise Leatherworks to focus on the two segments of architectural/furniture and corporate gifts. After talking to company representative of various firms, we found that the value drivers for the architectural segment focussed mainly on the quality of the goods as well as the functionality and flexibility in terms of designs. The desire for quality, New Zealand made products was an aspect that was mirrored in the corporate gift segment, along with the ability to create anything...