Calyx & Corolla Harvard Case Solution & Analysis

Threat of new entrants:

As the industry is providing higher returns; thus, it becomes extremely attractive for the new ones. Moreover, barriers to entry are found to be low as well because the cost of entering into it is not very large. The entrance of new barriers might increase the level of competition and, therefore, it will decrease the profitability of every company in the floral industry. However, C&C have a competitive edge in terms of its efficient value chain that can be difficult for new entrants to incorporate.

Bargaining power of suppliers:

Raw materials and the cost associated with the suppliers are extremely important for the profitability of a company. Big floral companies like C&C currently have thirty suppliers. Moreover, there are approximately eight growers that supply 80 percent of the supplies to the company. Hardly 25% of the business of growers are done by the sales of the company and thus these eight suppliers can dictate the industry.

Buyer’s power in the industry:

The buyers are the consumers who demand the products offered by the company. In the case of C&C, the bargaining power of buyers is low because there are a few major companies in the market that are running the industry and thus they have full command on it.

Industry rivalry:

The rivalry within the industry is dependent upon the level of differentiation, switching costs and on the structure of competition. The main point of differentiation for C&C is the efficient value chain for sure. It would be difficult for the competitors like FTD to make strong relationships with suppliers and distributors in a very short span of time. Although, there are so many competitors for C&C in the market like FTD and supermarkets that are known to be the giants in the floral industry but its structure is different from C&C and thus rivalry is not directly in that case.

Opportunities for business:

Virtual bouquet:

The company can add a program and named it as a virtual bouquet in which customers can send a bouquet to their loved ones online through the website of C & C. Customers only required to select a bouquet of flowers from the company’s catalog and give the company a recipient address. In addition to this, those recipients can also send that bouquet to someone else and that in turn makes a continuous chain. However, it is a fact that virtual bouquet may not have that much value as of the real ones, but it is cost effective with full of emotional feelings in it.

Developing an online catalog:

Another opportunity that C&C can avail is developing an online catalog. Along with this, C&C can use a company for instance Double Click that can send consumers to the company’s site. With the help of this, the company would be able to focus on words like gifts and flowers. This option would not be costly as well and give an opportunity to C&C to enter into a new market as well. In addition to this, the option is cost effective and thus gives higher returns to the company as well.

Making joint venture with internet companies:

Another opportunity that a company can avail is hooking up with one of the giants of the internet industry like Yahoo and make promotional activities on their page. In this promotional campaign, the company hides a bouquet somewhere on the website and if the customer succeeds to find out then those bouquets will be delivered to them or their loved ones. The only potential issue in this opportunity agrees internet companies to allow promotion on their sites in this way.

Business strategies available to Calyx & Corolla:

The company should focus on designing a website in order to portray the new designs and offerings to the current and potential customers. This strategy will help to attract more and more customers and will help them to sustain the current and attract new customers. Secondly the company should pursue a promotional strategy and start portraying its banners on some of the big company's web sites. A company should be selected on the basis of its user base as more people visit the website; the more people will get aware of C&C. This strategy will help the company to attract new clientele through attractive offerings and increase its customer base.

The next strategy C&C can use in its favor is joining hands with different internet service providers and sending gifts to every new customer that signs in with that internet service provider. This strategy will benefit both the company and the internet service provider and will serve as a good advertising campaign.

The third strategy that can serve the company well is collaborating with an NGO and using the internet as a promotion medium deliver the message that a specific amount spent on buying a C&C product will result in certain donation to the NGO from the company on consumers' behalf.......................................

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