Client

Global Industrial Products Manufacturer

Project

Operations and Distribution

Executive Summary

The client was experiencing strong competitive pressure from a foreign-based company. The competitor has gained significant U.S. market share as a result of a service innovation involving delivery guarantees. The client launched a competitive assessment to study the competitor’s manufacturing and distribution model to determine how the competitor was able to offer the higher level of service at a competitive price point. The client engaged Navigate International to research the competitor’s U.S. production and distribution models and to reengineer the cost of delivery.

Business Challenge

A foreign-based competitor entered the U.S. market with a production and distribution strategy that enabled them to “raise the bar” on customer delivery expectations, thereby winning market share. U.S. customers began migrating to the competitor’s product and demanding that other providers meet the new service guarantees. In a commodity business, the economies of scale associated with centralized production are offset by the costs of distribution which rise with the distance and urgency to the customer. The business challenge was to determine the relative efficiency of the competitor’s production and distribution models and to develop a response to the competitive advantage that the competitor had created.

How Navigate International Helped

The client engaged Navigate International to investigate the competitor’s U.S. operations and distribution models and to determine the competitor’s delivered cost. Navigate implemented a competitive intelligence program to identify the locations, roles, and functions of the competitor’s manufacturing plants, distribution centers and warehouses.

Value Delivered

Through competitive research and analysis, Navigate provided a clear picture of the competitors US operating structure, an understanding of how the competitive advantage was created, and insights as to how to respond to this competitive challenge. The information and insights generated through this research enabled the client to make and informed decision about how to respond to this competitive threat.