ISSUE STATEMENT
Westlake Lanes operated at a loss for the recent 3 years. The main issue in this case is how can they turn around their operational performance.
CASE ANALYSIS
The forefront case analysis includes external analysis and internal analysis. It is crucial to understand macro-environment, industry environment, and the capability of the company itself before making decisions. In this case, the PESTEL analysis is utilized for macro-environment analysis, the five-force’s is utilized for industry analysis, VRINE, and financial analysis are utilized for internal analysis.
EXTERNAL ANALYSIS
PESTEL Analysis:
Political: A 60% electricity usage of commercial compact fluorescent lighting subsidization from government for 24 months. As
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In addition, the government incentive for commercial electricity cost reduction and Small Business Association will facilitate to reduce the operational cost of Westlake Lanes. Moreover, the increasing number of Raleigh’s residents with relatively young age who have the buying power to ensure their customer flow. But the employees’ the increase of health insurance cost caused the operational cost of Westlake Lanes to increase.
The Porter’s Five-Forces Analysis:
The Threat of New Entry: The threat of new entry is relatively low in this case. Because Westlake Lanes has been operated for 30 years in an excellent physical location where close to lively neighbourhoods and restaurants in Raleigh’s downtown area. And during these 30 years, Westlake Lanes gained a large amount of loyal customers. It is hard for a new entrant to get such a location and relationship with customers even though the capital requirement for opening and operating a bowling alley is not high.
The Threat of Substitutes: The threat of substitutes is high in this case. This is because of the competitor for Westlake Lanes is not only other bowling alleys but also a wide range of other entertainment activities.
Supplier Power: Supplier power in this case is low. Although there are different suppliers for their bowling equipment, bowling accessories, and food and beverages, it is not hard for them to find new suppliers.
Buyer Power: Buyer power in this case is high.
The key issue faced by general manager Shelby Givens of Westlake Lanes is whether or not to maintain the current practices of the business or seek new alternatives. She must convince the board that within her allotted one year, progress has been made in improving the business and ultimately convince them that profitability is in the foreseeable future and that their personal debt will be repaid.
It is my understanding that Westlake Lanes is considering the following three options for its
Throughout the years Westlake Bowling lanes performance level was reducing, Shelby Givens was appointed as the general manager in order to make the situation better and repay the long-term loans. Board faced the situation whether to sell the business and repay the loans (or) to continue its operations as Shelby Givens plans shows promising revenue in the future.
Supplier Power. With a vast variety of products available to Lowe’s, the supplier power is low. Lowe’s can choose from different vendors the products mix that differ from their competition. In addition, entering contractual agreements with vendors helps in lowering this risk.
One threat to SHLD is its competition with many retailers because it is not very differentiated from its competitors and lacks brand loyalty, thus nothing is stopping the customer from overlooking Sears and visiting a rival retailer. Another threat is a downturn in the economy which could wreck havoc on SHLD’s financial position.
The overall threat of new entrants in the retail market is a high level threat as it is relatively easy and inexpensive to enter
Councilman Steve Johnson said he was involved with the Rec Center before it was established, and the understanding was it would never break even. Those who were in on creating the center looked at it like an “indoor park — it’s going to cost you money, a quality of life thing.”
I am going to first do the external analysis of the company. I’ll be using PESTEL Model to analyze various Political, Economic, Social, Technological, Environmental and Legal factors surrounding LV (Thomas, 2007). With it aims I’ll be checking the macroeconomic environment surrounding the corporation and I’ll be aiming to find out more about LV’s future perspectives.
Bargaining Power of Suppliers: The bargaining power of suppliers in the industry is low. There are numerous suppliers in this industry, and the large department stores have the ability to negotiate for the lowest prices. In addition, the switching costs are low, as the products are not highly differentiated. There are a large volume of purchases in the industry, allowing the department stores to exert even more power over the suppliers.
Being the biggest organization in the area is great, but threats are always around to stop an organizations growth. Competitors in the area is the biggest threat to Beau Chene Landscaping. Organizations that’s been serving the area years before its existence continue to gain customers. As I said earlier, customers in the area don’t change their service providers as much, and with the competitor continuing to gain customers
3) Stable clientele as fee is not varying according to the present needs or if needs changes in future.
Suppliers have less power because there are a lot of suppliers and they all willing to accommodate and provide discounts for their customers (economies of scale).
| Westlake Lanes had the capability to bring back old memories by playing the seventies and eighties music which is unique. Also, loyalty is not easy to buy. West lake also has a very good relationship with its lenders.
| Threats.Competition from local independents that can reduce price as owner operators lower than our staff-run stores..competition from national chains moving into the Brisbane market.A slump in the economy reducing customer’s disposable income spent on outdoor lifstyles.
Swan’s Ice Arena is a place for people to enjoy ice activities. Due to the reason that David who is the manager of Swan’s Ice Arena wants to increase the revenue, he plans to expand his public skating program. It will not limit the number of customer to 12 to 24 people; instead, it can meet 700 people’s need. The revenue changes from 200 to 3500 due to the increasing number of consumer. But the problem lies in that the target market is consisted of the teenagers and kids. They are free only on Saturday and Sunday afternoon. So it leads to the low revenue and high costs of the left time. By considering how to change the situation, he made a decision to focus on another target market of young couples. To attract the groups, he