For the company to increase its profitability in the long run, it should consider investing into manufacturing paddles for Stand-Up Paddling (SUP), in order to establish a transient advantage. Moreover, while it’s crucial to increase profitability, it’s also vital to remain competitive by remaining aware of both local rivals and new entrants.
Firstly, in terms of Fender Ltd., I propose that Relajante should form a joint venture (JV) via contract with them in order to gain access to their relationships with stores across the Gulf Islands, Nanaimo, Tofino and Campbell River. Not only will this increase our customer base, it will also enable us to gain an advantage over local stores. While, they’re requesting us to charge them $60,000 less for their bulk purchase of 5,000 paddles, we can consider the advantages of being partnered with Fender …show more content…
However, in terms of competition, the marketing team will have to keep an open mind in order to maintain a competitive edge within the market. Through an economic perspective, one knows that resources are limited, and that there are unlimited wants. Accordingly, if Relajante slows down to focus on only streamlining kayak paddles, the company will go through rough patches, once demand declines. With the given statistics concerning the percentage sales in each location, they are not increasing in all locations even with the increase in number of stores. Since doubling the number of stores hasn’t increased our profits substantially, I think it’s safe to attempt investing into manufacturing paddles for SUP. The primary reasons for this suggestion is the higher demand and the fact that it’s easier to facilitate and control as compared to attempting to alter customer