Enhancing Competitive Advantage for Fun Time Superstore: Strategic Analysis and Recommendations

Abstract

Fun Time Superstore – Strategic Analysis and recommendation MGMT 475.WB1 Fa22 Dr. Carter Strategic Analysis and Recommendation. I. Executive Summary Fun Time Superstore‘s growth is acceptable, but its profitability is below the industry average. Specifically, their operating efficiency is inferior, as indicated by their below-average Operating Margin over the last three years. Their ability to capture value, specifically in operating profitability, is the primary area to focus on toward improving their competitive advantage. II. Analysis of the Firm a) Describe the Assessment of the Firms Financial Performance Fun Time Superstore’s ability to create value has been trending downwards over the last three years but has increased in 2021. Their ability to capture value has remained stable and declined a bit. Gross margin is consistently in the 33-35% range, which is about average for the industry, and the operating profits have fallen from 14.2% in 2018 to 10% in 2020 and 12.8% in 2021, which is now below the industry average of 13%. b) Describe the firm’s Current Competitive strategy Product Focus, exterior decorations, novelty candy, gifts, and mylar balloons. Target Customers, sports teams, and seasonal holidays (Halloween, end year, and winter holidays). Business model, Retail (B2C)- Online or pick-up stores, multi-channel retailing Value Proposition, options to buy online, pick up stations, and in stores. The goods sold combine propriety designs, licensed designs, and value brands. Geographic scope, North America. c) Describe and argue the firm’s THREE most valuable sources (real or potential) of competitive advantage. Capabilities. It can develop and launch innovative designs that allow FTS to keep its product offering fresh and current with the latest consumer and pop-culture trends. It can source branded and generic goods while also designing and producing proprietary products, allowing FTS to offer a broad selection of goods covering multiple portfolio categories such as high-quality, innovative, and competitively priced. FTS can Identify and capture the best retail locations that deliver superior inventory management information and rapid order turnaround times. FTS has the capability to develop and implement cross-product category merchandising, which motivates customer browsing, exploration, curiosity, and creativity. FTS has the capability to incentivize and motivate employees by promoting their welfare which fosters a positive work culture and fulfilling the company’s purpose. Resources Licensing of sports team proprieties such as the National Football League, Major League Baseball, The National Basketball Association, and the NCAA. Propriety designs, licensed designs, and commodity-like value brands Experienced top leadership (20 years experience in senior management that has navigated multiple economic cycles, business transformations, and integrations of numerous acquisitions and business extensions). Four domestic factories producing propriety and licensed products located in [City, State] (plasticware), [City, State] (paper plates, napkins, tablecloths), [City, State] (mylar balloons), and [City, State] (stickers, gift wrap, wall décor, and another miscellaneous paper décor) Retail stores Distribution centers in [City, State] (a state-of-the-art paperless, light-based picking system), [City, State] (primary party goods), [City, State] (metallic balloons and accessories), and Lee’s [City, State] (e-commerce order processing). III. Analysis of the External Environment. FIVE FORCES INDICATOR WORKSHEET a) Identify and explain strongest competitive force(s) facing producers in this industry There are two strong competitive forces in the FTS industry: The threat of Substitutes and the Bargaining Power of Buyers. b) Explain the TWO OR THREE...