Case Study for Harley-Davidson

2331 Words Aug 18th, 2010 10 Pages
1.0 Introduction
This report is to discover and solve the problem caused by the internal and external of the company. Harley-Davidson is a famous motorcycle manufacturer. But within high competition, Harley finds that it is lack of technology advantage, inapposite strategy for development, and gets more competition by analysing its capabilities and resources and its competitive environment. To solve these problems, Harley has to take three steps which is mention in recommendation.

2.0 Company Profile
Harley-Davidson is a major US maker of motorcycles and the nation 's #1 seller of heavyweight motorcycles. The company offers 35 models of touring and custom Harleys through a worldwide network of more than 1,500 dealers. Harley models
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These five forces of competition include three sources of “horizontal” competition: competition from substitutes, competition from entrants, and competition from established rivals; and two sources of “vertical” competition: the bargaining power of suppliers and buyers

The ideal industry is very attractive in terms of growth and profitability but with high barriers to entry, is not faced with competition from substitutes from other industries, has weak suppliers, has weak customers, and has relatively few firms within the industry, who avoid competing on cost and price, and where demand exceeds supply.
(Byars, Rue & Zahra, 1996)

Bargaining Power of Buyers: Customers are becoming increasingly powerful due to * Increased price competition within motorcycle manufacture or with Harley-Davidson. * Customers may access to substitutes.
The major buys of Harley-Davidson are those people around 40 ages that like 70s design. The classic design creates some loyal customers, and it’s also a product advantages compare to its competitors. Beside, Harley-Davison provides great after-sale service and expends its relationship with its buyers like HOG. Hence, Harley-Davidson’s buyers won’t easily switch to its competitors, although the switch cost is low.

Threat of New Entrants: If an industry earns a return on capital in excess of its cost of capital, that industry acts as a magnet to firms outside the industry. The new entry of other company such as Big Dog has

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