Essay on Final Capsim Report

676 Words Nov 14th, 2011 3 Pages
State of the Industry:
The sensor industry is an attractive industry due to its’ rapid growth rates and high entry barriers. Additionally, there are no close substitute products. The bargaining power of suppliers is not a factor affecting the sensor industry at this time. However, the bargaining power of buyers is extremely strong, due to the fact that switching costs are low, and most product segments are fairly standardized. The sensor industry is also characterized by intense rivalry among six strong competitors.
State of the Company:
Chester Sensor Corporation is in a good competitive position at the end of the seventh year of operations. Market share, profits, and stock price have all increased. There were some bumps in years
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The key determinant of Chester’s’ success was the management commitment to superior business processes. Chester has a state of the art facility. Management increased capacity in the years after the government split and will continue to add capacity as growth dictates. However, capacity will be expanded at a lower rate than previously, in an attempt to avoid cash flow shortages seen in prior years. Chester has enhanced automation and quality processes in order to gain production efficiencies and cost savings. Chester has invested in labor recruiting and training; developing core competencies in it’s’ workforce. The firm has and will continue to maintain investment in research and development, as product improvements will continue to be demanded by the customers. The other key factor of the corporation’s success was the superior growth of the industry. It would have been much more difficult to sustain profitable growth in this extremely competitive market without the superior volume growth of the sensor industry.
Future managers of Chester should continue plant improvements and labor initiatives, while focusing on product segments with the highest contribution margins. Management needs to develop accurate forecasting techniques to avoid the inventory swings seen in the first five years, and the inventory stock outs that occurred for at least one product every year. Future success will depend on leveraging the core competencies of Chester and

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