Electrolux Case Analysis

1007 Words 4 Pages
Electrolux is an appliance company established in 1919 in Stockholm, Sweden. The company produces items such as refrigerators, dishwashers, washers, and dryers. They pride their selves on being innovative and manufacturing well-made products. More importantly, Electrolux’s goal is to be the best and well-known appliance company in the world as measured by customers, employees and shareholders (“Electrolux, n.d”). From conception, Electrolux has made strides to meet their vision. Notably, in 2015 the company should over 124 billion dollars worth of merchandise. Undoubtedly, this could not have been possible without a strong and effective business strategy.

Barney J. B created the VRIO framework can be used as a tool to determine and analyze
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Competitive advantage is anything that separates a business apart from its competitors in a positive way. VRIO framework requires a company to consider various factors. For one, how does the company set itself apart from its competitors? It is crucial that the business has at least one component that differentiates them from other businesses. With this in mind, if the business is the same as their rival there is no reason for a customer to choose them over their competitor. Secondly, it is important to decide whether the business contributes to customer value. Thirdly, the competitors should not be able to imitate a companies products or services. Last but not least, after these elements are considered then the company must implement them with the desired result being sustained competitive advantage. Electrolux demonstrates all four of the VRIO factors. As for differentiating themselves from their competitors Electrolux focuses on both becoming an internationally established company and continuously works on innovation. While other companies may become complacent Electrolux …show more content…
These are cost leadership strategy, cost focus strategy, differentiation strategy and differentiation focus. First, a low-cost focus strategy is one that focuses on a particular buyer group or geographic market and attempts to serve only this niche, to the exclusion of others (Wheelen, 170). Whereas, cost leadership can go two ways either a company sells its products at average industry prices to earn a higher profit or them below the average prices to gain market share (“Porter’s Generic, n.d”). The differentiation strategy main goal is finding a way to separate a company from its competitors by creating a new or inventive product. To sum up the differentiation focus strategy it requires a business to focus their attention on specific group or target market. In this situation, Electrolux should carry out the differentiation focus strategy by targeting a specific geographic market. Since the Chinese manufacturers are a concern using this particular strategy could put them

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