Market Analysis and Strategic Recommendation

Market Analysis and Strategic Recommendation

Market Analysis and Strategic Recommendation

Introduction

Bryan's Tutoring Service is an Oregon-based company that offers tutoring services for a wide variety of subjects. The company is currently a sole proprietorship, however the business plans to change its organizational form to an Oregon-based LLC within the next year or two.

Company/Organisation Profile

Bryan's Tutoring Service was founded by Bryan Thomas while Bryan was attending Atkinson Graduate School of Management. Although the company has informally existed for the last two years, operations have been informal, picking up students here and there. While it has filled some of Bryan's spare time, he is now ready to concentrate on developing this business into a more efficient source of revenue while retaining the joy of teaching that attracted Bryan to the business. The first step of this transformation is the writing of a business plan. This plan is being used as an internal document to assist in the development of the business. Bryan's Tutoring Service operates with very low overhead, therefore Bryan's Tutoring Service will not be seeking capital for operations (Adcock, 2009, 15).

Market Analysis

The company was founded tutoring students in the graduate school of management in their quantitative subjects. This remains the core segment, although other segments have been developing and show potential to provide the bulk of future income. Graduate students can be divided into three groups: quantitative subjects/students, non-quantitative, and international students.

Undergraduate students will also be served, however Bryan's Tutoring has a less intimate relationship with the various undergraduate schools and professors. There are several colleges, public, private, and community-based that will provide Bryan's Tutoring with a steady flow of students. Bryan's Tutoring will offer tutoring in the courses offered to graduate and undergraduate students. Please review the following section which provides additional detail regarding the different target segments. (Adcock, 2009, 15)

BCG Growth-Share Matrix

This framework assumes that an increase in relative market share will result in an increase in the generation of cash. This assumption often is true because of the experience curve; increased relative market share implies that the firm is moving forward on the experience curve relative to its competitors, thus developing a cost advantage. A second assumption is that a growing market requires investment in assets to increase capacity and therefore results in the consumption of cash. Thus the position of a business on the growth-share matrix provides an indication of its cash generation and its cash consumption.

Henderson reasoned that the cash required by rapidly growing business units could be obtained from the firm's other business units that were at a more mature stage and generating significant cash. By investing to become the market share leader in a rapidly growing market, the business unit could move along the experience curve and develop a cost advantage. From this reasoning, the BCG Growth-Share Matrix was born.

The four categories are:

Dogs - Dogs have low market share and a low growth rate and thus neither generate nor consume a large amount of ...