Corrugated Box Industry

CASE STUDY EDMUNDS CORRUGATED move AND SERVICES. Larry Edmunds grimaced as he tossed his lodges latest quarterly loot onto his desk. When Virginia-based Edmunds Corrugated Parts & Service Companys sales surged departed the $10 million mark a while back, he was legitimate the company was well positi mavend for soaked growth. Today, the company, which provided precision machine parts and servicing to the domestic corrugated niche fabrication, still enjoys a dominant market place voice and is marching profit, although not quite the profit seen in long time past.However, it is no longer possible to ignore the fact that revenues were beginning to show clear signs of stagnation. More than two decades ago, Larrys grandfather loaned him the money to snuff it the business and then handed over the barn on what has been the familys Shenandoah Valley farm to serve as his first factory. Today, he operates from a 50,000 square-foot factory located near I-81 just a few miles from that superannuated barn. The business allowed him to realize what had once seemed an almost impossible goal He was making a good living without having to leave his close-knit all-inclusive family and rural roots.He also felt a sense of satisfaction at employing about 100 pack, many of them neighbors. They were among the most hard- exerting, loyal workers youd receive anywhere. However, many of his original employees were now nearing retirement. Replacing those skilled workers was going to be difficult, he realized from experience. The areas brightest and best young people were much more likely to move away in try of employment than their parents had been. Those who remained behind just didnt seem to have the work ethic Larry had come to expect in his employees.He didnt feel pres authorizedd by the emergence of any new direct competitors. After slipping slimly a couple years ago, Edmundss formidable market share based on its reputation for reliability and exceptional, personalized service was retention steady at 75 percent. He did feel plagued, however, by high raw material costs resulting from the steep increase in brand prices. But the main source of concern stemmed from changes in the box attention itself. The industry had never been particularly recession resistant, with demand move with manufacturing output.Now alternative shipping products were beginning to make their appearance, mostly flexible fictile films and reusable plastic containers. It remained to be seen how much of a dent theyd make in the demand for boxes. More worrying, consolidation in the opus industry had wiped out hundreds of the U. S. plants that Edmunds once served, with many of the survivors either opening overseas facilities or entering into joint ventures abroad. The surviving manufacturers were investing in higher(prenominal) quality machines that broke down less frequently, thus requiring fewer of Edmunds parts.Still, he had to admit that although the highly fragmented U . S. corrugated box industry certainly qualified as a mature one, no one seriously expected U. S. manufacturers to be dislodged from their position as major producers for both(prenominal) the domestic and export markets. Edmunds was clearly at a crossroads. If Larry wanted that steady growth hed assumed he could count on not so long ago, he suspect that business as usual wasnt going to work. But if he wanted the company to grow, what was the best way to achieve that goal?All he knew for sure was that once he decided where to take the company from here, he would short sleep better. QUESTIONS 1. What would the SWOT analysis look like for this company? 2. What role do you expect the Internet to play in the corrugated box industry? What are some ways that Edmunds could better use the Internet to hold dear growth? 3. Which of Porters competitive strategies would you recommend that Edmunds follow? Which of the strategies do you think would be least likely to succeed?