Swisher Mowers Case Study

Swisher Mower and Machine Company Case2/9/16To better understand Swisher’s situation in the lawn care market, I performed a SWOT analysis. The top three strengths that stood out to me from SMC is that a special loyalty has been demonstrated to the original SMC dealers and distributors that have helped build the overall sales foundation of the company. SMC continues to guarantee protection of these and other dealer’s trade territories throughout a long period of time. Max Swisher built a good name by always focusing on his company being a customer-oriented business to build personal relationships with dealers and customers. Not only has SMCestablished a good reputation with his dealers and distributors, they have the same kind of reputation withits customers. SMC has a reputation for producing high-quality riding mowers that have a simple and easy to use design, long-lasting (sometimes can last 25 years), and the parts are interchangeable with older models. The third and what I believe to be the most important strength is that SMC has forever remained a profitable company. Another minor strength is the new CEO seems to have a good skillset, qualified, and decently experienced before taking his position. Some weaknesses of SMC is that unit volume sales have plateaued in recent years (even though they’ve still been profitable). A factor of this and another weakness is that its facilities have an annual production capacity of 10,000 riding mower units in a week. This could also be a constraint with the new proposal. Maybe to increase sales, SMC needs to invest in a way to mass produce on a higher level. The last and least significant weakness is the timing of the new hire. The new proposal is offered when the new CEO takes his position, this is the first major decision as president. Was the timing of the proposal from the company strategically planned?As far as opportunities, first of all, the new proposal inquiring about a private-brand distribution arrangement can completely change SMC in a positive light for distribution. Another opportunity is that the “trail mower” line is possible with or without the new proposal and the new Trim-Max product is soonto be introduced under the Swisher name. Also, Swisher may pursue more aggressive advertising and

 

Deer and American Yard are assumed to be industry leaders, mainly due to the fact that they sell to massmerchandise stores. Mass merchandise stores, such as Wal-Mart and Home Depot, account for thelargest percentage of sales for riding mowers, while outdoor power equipment stores supply 22% of allsales.The market is continuing to grow, as sales increased during 1993 and 1994, with a projection of further increases in the next two years. The industry is very cyclical as well as seasonal. As theeconomy depresses, unit sales decrease. Almost one third of retail sales for riding mowers occur  between March and May.Buyers with larger lawns typically look to purchase riding mowers. The industry offers twotypes of engine configuration: front-engine and rear-engine tractors. Consumers prefer front-enginemowers, because they believe they are more powerful. Consumers with larger tracts of land willtypically look for more powerful engines, as well as equipment which is more durable. Price may swaymany consumers, with mowers ranging from $800 to $5000. This creates segmentation with buyers:some buyers who have less land will look for smaller models, while other individuals who have largetracts of land will require larger models.Swisher was founded by Max Swisher in 1945, who first developed a self-propelled push mower.Once the Ride King was developed in 1956, Swisher saw a peek in sales of 10,000 mowers in 1966.Currently, sales are stagnant, with the company selling over 4200 riding mowers accumulating sales of $4.3 million. The company’s main product is the Ride King, and the T-44 Trailmower for larger cuttingareas. Swisher has maintained a high quality, simple product to allow ease of use to consumers, afeature also found in its trimmers. The mower undercuts the price of its competitors, retailing for $650.Riding mowers account for the majority of sales, while replacement parts generate another 20% of sales.The company focuses on minimizing debt, while consistently returning a 10% margin on sales.

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