The key issues for The Davis group on entering the Australian market can be identified by a SWOT analysis.
The Davis Service Group has been successful in generating profit and growing, they had generated pre-tax profits of £82 million in 2007, which was one million up from the previous year, after that they did have a dip due to the recession as all business were hit and The Davis Service Group lost some customers who suffered from the global recession but they did a lot better than most other business as The Davis Service Group still managed to produced £52 million in their last financial year ending in July 2009, this is a big drop but considering the economic climate the results are very good compared to other companies.
– Successful business model
There has been strong competition in the areas in which The Davis Service Group operates in, however the company has been very successful by looking at their growth and their sales revenues and profits over the last few years. This success is only because of their very successful business model, which brings customers back to the business and their operational efficiencies.
– Uncertainty in Overseas markets
Due to the recession the hotel industry has crashed as people can’t afford holidays anymore, this will affect The Davis Service Group very badly as hotels are having low occupancy rates, also their tool hire business is suffering in the USA as the dollar gets weaker things could even worsen.
– Customers unaware of business type
Market research shows that many customers believe that HSS is a trade only outlet, which has affected the company. The Davis Service Group is now putting money in to marketing campaigns to make customers aware of the nature of the business.
– Public Sector
There is a very big demand still for textile maintenance services in the public sector, especially hospitals and boutique hotels, these can bring extra business for the company.
As we are in the financial crisis and companies are going into big financial problems this can be a good time to take over these companies which could come cheaply for a bargain as they are in problems, this would be a good way to expand into other markets and grow your company and when the financial crisis is over you will benefit.
The markets here are very saturated and with the potential for differentiation or innovation very low companies will compete on pricing, service and quality.