Case Study Of NSY

4393 Words 18 Pages
Register to read the introduction… Initially, NSY’s approach was solely an e-commerce solution, where crews could access the catalogues of hundreds of suppliers through the website’s one-stop-shop format. Shortly after launching the company’s website in mid-2001, sales reflected a need for change which led management to adopt a hybrid business model that incorporated a brick and mortar storefront into the mix. NSY’s first storefront was located in Barcelona, with a second coming on heels of increased sales, in Palma Mallorca, Spain. This strategy aided NSY in achieving first year sales of $200,000, a number consistent with projections outlined within the business model; however, sales in year two stagnated, accounting for only 11% of investor expectations (Mark & Mitchell, 2003, p. 48). Given this troubling reality, management began to evaluate whether the company’s current strategy was best suited to extract maximum value from NSY’s unique concept. In an effort to aid NSY in evaluating the strategic positioning of the company, this project aims to answer one central question. Should NSY strategically align with key industry players; or, would organic growth be a more beneficial option for generating the additional value needed to once again realign the company with …show more content…
Much of what is known comes from that which is outlined in the case. Those participating in the industry include yacht builders, yacht management companies, yacht owners and crews, traditional procurement agents, repair and retrofit yards, and local husbanding agents (Mark & Mitchell, 2003, p. 50). As the industry name suggests, the Mega-Yacht industry caters to the super wealthy, primarily from the United States and Europe. Given that the wealthy covet uniqueness, most of the yachts in the industry are custom, making repair part identification and standardization difficult. Another unique feature of the Mega-Yacht industry is that it is in constant motion. Customers are in Spain one week and in Greece the next. The industry’s transitory nature burdens all involved with continual logistical issues. In 2003, there were approximately 5000 mega-yachts worldwide which generated slightly more than $1B in economic activity, 60% of which came from repairs and retrofit (Mark & Mitchell, 2003, p. 48). Although the industry as a whole was expected to grow at a rate of 6% annually, new builds were down nearly 5% from 2002 (Mark & Mitchell, 2003, p. 49). In 2002, the industry began to see the first signs of consolidation. Yacht builders began to acquire service providers, and larger suppliers beginning to enter new lucrative markets through …show more content…
NSY had considered this strategy with Palmer Johnson Corporation after following on the heels of declining sales. During consideration Metcalf was confident in the potential increased sales and company growth NSY would experience from such a venture. Palmer Johnson is a consistent company, having longevity in the mega-yacht industry since 1918. Within recent years Palmer Johnson has expanded their company reputation by becoming the “first yacht builder to introduce the use of modular production process and 3D engineering of yacht.” (Palmer Johnson, 2013) NSY can benefit greatly from this company’s affluent research and development for future

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