Hagen Style is a direct marketing company that successfully used the direct selling operation strategy through its representative to sell its products. Over the years, the company made its mark in the market and has developed one of the best warehouses with excellent packaging systems for products with the best technology available. As for the transportation and distribution system, the company became one of the best order fulfillment operations in the world. However, from a competitive analysis, the competition has grown and developed as they adopted new operations strategies that brought in more profits and accommodated a variety of orders.
Therefore, Hagen Style needs to develop its operations strategy in order to reach …show more content…
Hagen Style’s dilemma is that they have to meet the new market requirements or they will start losing their market share. A big issue is that the current operation resources are not aligned or reconciled with the new market requirements.
The company was successful until recently due to its initial operations management design that met the market requirements at the time. They had two distribution centers with low costs, limited packing errors with state of the art technology and fast fulfillment of the orders from receipt to dispatch. Hagen Style used the direct marketing approach
(door to door) through its representatives.
The current problem is that selling through traditional representatives channels is declining in popularity whereas new channels are emerging as catalogues, the Internet and selling through discount stores. The company’s dilemma, after realizing that the market is changing, is how to change their operations strategy. Should they stick to their old style with their loyal customers? Or should they change and develop a new strategy and new channels?
Hagen Style- Operation Resources and Marketing
• 2X distribution centers
• State-‐of-‐art packing and …show more content…
Stick to its current services and customers through its existing channels. The downside of this option is losing marginal sales and a decline in profits.
Option B: Limit or abandon new channels to market and seek out new business opportunities. This would allow the company to concentrate on what it does best.
Option C: Accept that the market has changed and develop an operation strategy that serves all parts of the market including existing channels, subcontracted businesses, store delivery and catalogue customers. This is the option that we think suits the company best as it keeps its existing channels and what it does best and branch out to reach other customers with subcontracted stores and catalogues. This will increase productivity and profits. Summary
Hagen Style knows that it has a problem and is facing it by analyzing the situation and weighing its options. From the above, we can conclude that operational strategies are a long-term process. Therefore to identify the best strategy, companies need to take their time to discuss and explore all options and analyze tem to finds the strategy that suits their vision best.
Slack, N., & Lewis, M. (2002). Operations strategy. Harlow [u.a.: Financial