Suprema Cars, a classic sports car manufacturer in Northern England, has had to face a lot of problems over the last few years: * Firstly, the company began to lose sales and market share, and in the last two years, it has made a loss. * Secondly, the factory workers are dissatisfied with the present situation: They demand higher wages and better working conditions. * And thirdly, the cars have suffered from a loss of quality due to an increased production. Therefore, Suprema Cars has to react quickly because otherwise they will go out of business.
Introduction This report will look at two possible options for the company on how to solve these problems and increase its profitability. Moreover, it will give some recommendations on how to be able to stay competitive in the car industry. Findings First of all, the company is forced to raise additional finance from an outside source in order to put into practice the following projects: * Suprema Cars should launch its classic sports cars in the United States. Thus, the company could increase its sales due to a larger target group (5. million inhabitants in Great Britain in contrast to 310 million inhabitants in the United States). In view of the financial situation of Suprema Cars, this would be a very economical option. * In addition to the classic sport car, Suprema Cars should launch an environmentally friendly, small car that uses the company’s brand name and design. With a small, dual fuel car, the company could attract new customers – people who live in big cities but who also set a high value on environmental protection.
Moreover, rising energy costs and increased emissions regulations will certainly increase the demand for hybrid electric cars, as hybrid engines are more fuel efficient and less polluting than conventional gasoline and diesel engines. Worldwide demand for hybrid cars is estimated to reach four million units by 2015. * Suprema Cars has to repair the roof of the factory in order to offer the factory workers at least a safe working environment. Conclusion
The above-mentioned projects would lead to job satisfaction of the workers and to an increasing profitability. But first of all, the managers of Suprema Cars have to find banks which are willing to lend a “loss-making” company money. Because inventing and launching an environmentally friendly car with all the special equipment is expensive. In view of global warming, however, it is clear that going green is the future. Recommendation The company has to adapt its cars to changing customer needs as well as to a changing environment.
If the company is able to respond quickly to these changes, it will stay competitive and can increase its profitability. Therefore, the managers of Suprema Cars have to do market research in order to find out whether they can sell their cars in the American and British market or not. In order to meet the demand, Suprema Cars must continuously focus on developing new high technology products for hybrid electric cars. Therefore, they can also try to find out which technology the German competitors use for environmentally friendly cars.