Dansk Designs, Ltd.

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Dansk Designs Ltd., founded in 1955, is a company that markets stainless steel flatware. The firm traditionally followed a strategy of differentiation. They produce high quality products for the "top of the table". Their goal was to reach a small market segment, which consisted of upper class, prestigious customers. Dansk Designs wanted to sell the concept of the Dansk brand, and believed their consumers would purchase the Dansk products because of the prominent brand name and because the products were the very best in taste and quality. Ted Nierenberg, the founder of Dansk Designs has recently decided that he wants to keep Dansk growing at 15% to 20% per year. Nierenberg feels as if his current product line will not provide sufficient…show more content…
However, I believe that the intended introduction of the new gourmet line is a terrible idea for Dansk Designs. Dansk has prided itself as a high quality, high-status producer of stainless steel flatware, and I think if they expand their product line to include lower quality products at lower prices they will harm their brand identification. A firm that strategically positions itself with differentiation can damage their brand image by adding products with lower prices and less quality. Even though expanding will probably cause sales for Dansk to skyrocket because many middle to lower class consumers will purchase the new products, their profits will decrease in the future because their original consumer market will most likely decrease their purchases because of the tarnished image of the high quality brand. Since the higher quality products could be priced higher, they brought in a high amount of profit to the company. If Dansk loses their higher-class consumers, their profits are going to decrease dramatically. Therefore, I believe it is in Nierenberg best interest to improve the management of his company to decrease costs. If he is able to substantially decrease costs, he will be able to reach his goal of growing 15% to 20% a year without increasing volume. My strategic recommendation for Ted Nierenberg is to implement a combination strategy of integrating overall

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