Callaway Golf Company Case Analysis Essay example

Better Essays

Callaway Golf Company

1.) The defining business and economic characteristics of the golf equipment industry can be measured by looking at the makeup of the industry itself. The case states that there are approximately 26 million Americans who play golf. 5.4 million play at least twice a month. These numbers are expected to grow by 1 to 2 percent a year until at least 2010. Of the U.S. golfers, 25% are seniors, 5.7 are women, and 2.1 million are juniors. The typical golfer is a 39 year old man who earns about $66,000 annually. Golf has also started to expand globally with 16 million and 2 million golfers in Asia and Europe respectfully. In 1999, the golf equipment industry took in about $2.7 billion in wholesale sales (2nd only to …show more content…

The amount of inventory is still pretty high $98 million. If Callaway can lower it inventory, then other costs will decrease and improve the financial performance.

6.) Callaway's strengths include a great research and development department, a recognizable name brand, being innovators in the golf equipment industry, maintaining strict guidelines to ensure the quality of all its products is superior, good leaders (mainly Ely Callaway) and having great customer relationship skills. A couple of Callaway's weaknesses are a relatively low stock price and high levels of inventory. Some opportunities include expanding its product lines into new areas like golf balls; going after different segments of the market like the beginner golfers; improving its marketing campaign by signing new endorsers; and building/designing new golf clubs that will continually revolutionize the golf industry. A few threats facing Callaway including losing the gap in innovation with its competitors; a downturn in the golfing environment; changes in leadership may cause the company to suffer; and losing market share to current or new competitors.

7.) Callaway structures it value chain so that each component always results in improving the product's worth to the end customer. At the beginning of the chain, Callaway tries to produce clubs that will create the best performance by its users. Callaway spends more money on research and

Get Access