The Murray Ohio Manufacturing Company Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

INTRODUCTION

The location in which Murray Ohio is based is named as Brent wood, which is a Suburb of Nashville. In addition to this, the company was involved in the manufacturing of two product lines, which comprises of the power mowers, and the second one is bicycles.

Hence, the production of bicycles was started in Ohio in the fiscal year 1936 and that the production was comprised of the different range of bicycles. Moreover, the sales of these bicycles took place under the brand name of Murray as well as the private labels of retailers who had a strong position.

Moreover, there also seemed to be a strong competition in this market in which Murray and its competitors were operating.On the other hand, in the fiscal year 1984 the company performed a manufacturing of one-third of the bicycles as well.

However, the other product in which during that product’s production,Murray was involved in including the power movers in which it became involved in the fiscal year 1986.Moreover,by the year of 1984, it was able capture large slice of the market due to this product.

Like the bicycles, the power movers were also available in a wide range.Hence, these power movers were the main reason due to which the performance of Murray Company turned better, but on the other hand, the bicycles affected the performance of a business on a large scale.

In addition to this, by taking account of the industry trends related to the bicycle industry, they grew at a rate of almost 7.80% and this growth seemed to be effective.However, the increase in imports at a rate of 50% resulted in a highly adverse effect over the domestic producers of bicycles. Hence, the models that are related to the power mowers include the tillers, snow blowers and plows.

PROBLEM STATEMENT

By taking into consideration the earnings of Murray Ohio, it reflected a decline in the earnings in a fiscal year 1984 in comparison to the fiscal year 1983. In addition, the other problem that was faced by the company was in relation to the rise of cheap imports into the country.

This also resulted in the decreased profit margins of Ohio as well and there was an impact upon the financial performance of Murray Company, which is evident from the financial statements of the Ohio.

CASE ANALYSIS

By taking account of the company’s annual report for the fiscal year 1984,it is evident that the previous year 1984 turned out to be quite difficult for the company. This resulted due to the decrease in the total sales as well as there was also a decrease in the earnings of the company.

Despite this, there were some of the reasons, which gave rise to the fall in these earnings.Moreover,it is worth mentioning that this reduction in Murray’s earnings took place due to the rise of the imports that were related to the bicycles.

The increase in percentage terms was 55.00% and this massive increase resulted in adversely affecting the pricing of these bicycles, its sales and as well as the production levels.

Moreover, the second reason in reducing Ohio’s earnings was the intense domestic competition in these product lines that were related to Murray Company. Hence, by analyzing the facts reflected in the case, it can be mentioned that the profitability of Murray Company was also affected.

It is also worth mentioning that the sales of Ohio are showing a decreasing trend up to the fiscal year 1984 and in percentage terms.The sales are showing a decreasing trend by almost 1.00%.

Hence, this can be assumed that the performance can be improved in the coming period by devising certain effective strategies that will result in the improvement of a financial performance of Murray Co.

In addition to this, the rate in which they are growing is 10%, which may also have the ability to overcome the issue based upon the earnings of Murray.Moreover,there is an issue in relation to the cheap imports.However, by taking account of the 1984 annual report it is also evident that the majority of the decrease took place due to the bicycle segment.

The earnings of Murray after the nonrecurring adjustments showed a decrease of 43.00%, which represents that the earnings reduced by an amount of $2.01 from the earnings of almost $3.53......................

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