Dick Smith – External Influences, Markets
Article: http://theconversation.com/dick-smith-couldnt-compete-and-that-is-why-it-failed-52755
Dick Smith – Markets
Dick Smith couldn’t compete with the external influence of existing and rising markets, and this is why it failed to reach targets causing it to go into receivership. Although Dick Smith was also impacted by internal influences, the main impact on the business was the external influence of markets.
Because of the size of the existing market it failed to compete with big brands that have begun to expand and/or launch into the retail market of technology in the past 5 years such as JB HIFI, Harvey Norman, Aldi and Office Works.
To compete with these companies, they needed to keep up
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They were very popular due to consumer demand for their products. After many years Pumpkin Patch got very outdated and their products were no longer in date and customers began to lose interest.
In the article we see that the main reason for the closing down was due to the out dated products.
The types of products that are produced within the business will have great affect on internal operations. This is certainly shown through this article and how pumpkin patches products were not satisfactory for consumer demand and this affected the internal development of the business.
It meant that the operations began to slow down for the business and lead to the closing down.
Many customers said that their products were stuck in the nineties. Because of consumer feedback it shows how they felt abut the products and the business didn’t take enough action to keep up with the market and release new products. This was a massive holdback for the business and why it struggled to sell products. They certainly had many boom and bust periods but in the recent years they didn’t act fast enough on the bust period and it shows that it is important to take action and try to fix the internal influences within the
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Masters on the other had taken a different approach and decided to join the big guns early on and go too big too soon.
Clearly not enough thought was put into this big investment when Masters was created. They had many advertisements and marketing was a big influence for the business.
But something that let them down was the external influence of competitive situation.
In this market, their were already many big and successful business such as Bunnings.
Bunnings has many establishments across Australia especially NSW where Masters developed their first big settlement. Bunnings have dominated this category of business and have done so for may ears. Because of their success Masters was too far behind in the sector. The competitive situation was a big driver for the failure of Masters and was one of the main reasons for the closing.
If Bunnings weren’t as big of a name, they may have had more of a chance but many Australian’s already know that Bunnings is a successful company and its very well known. They have built that trust of being a loyal company unlike Masters which was very knew to this