Strategic Research on ZipCar Essay

846 Words Apr 29th, 2014 4 Pages
Scott Hunt
4/3/2014
MGMT 452
Case Study: Zipcar
Assignment Questions
1. Evaluate this potential venture and the progress that Chase has made.
The potential of Zipcar exceeded the expectations of the owners Chase and Danielson in many factors. Their goal of creating this urban-style car borrowing system gave new light to the ideas of what options urban populations see in commute. The initial idea needed to be sized properly and growth was a big factor in terms of how fast they could get their cars on the road. With every bump and hurdle, the owners faced new issues of assumption miscalculations and investment needs. However, the success of their pivoting methods gave hope to the success of the business. The progress that Chase made
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The action Chase took did give comfort, as her improvement in the business model provided a new method of marketing to low income residents and more effective pricing strategies.

3. What actions should Chase take as a result of the September operating results?

The actions Chase should take as a result of the September operating results are to change the budget in terms of what investment needs to be focused on the most. Variable costs, such as leasing per vehicle and parking costs, played the largest role for expenditures. These costs were constantly increasing and therefore required immediate attention. However, Chase was surprised in the results for marketing with costs as low as $1500 per month spent in that category. This data would be useful in helping to ease investor mindset of marketing difficulties within urban communities. The cars themselves would actually serve as mobile marketing methods to spread by word of mouth. Therefore, the actions Chase should take are to focus on gaining investment to fund the increasing variable and fixed costs within her business model and providing data of improvement from the change in annual prices and variable prices for consumers. This would allow for her to promote upon the idea that with this much needed investment she would gain marketing and consumers on the same purchase of new cars.

4. What is the strongest argument Chase could make to a potential investor about the attractiveness of the venture? What,