Tropical Salvage
Tropical salvage if a private manufacturing company specializing in handcrafted furniture made from salvaged hardwoods. The company was founded by Tim O’Brien in 1998 to utilize the highly skilled Japanese woodworkers who were unemployed. The founder saw an opportunity in the unlimited and inexhaustible supply of tropical timber around Indonesia and made it a business venture. With high skill in woodwork, his manufacturing company is able to make unique furniture and sell for profits. The company business venture is not for profits alone but also reduces wasteful exploitation of resources. The raw material of Tropical Salvage include remnants of demolished wooden structures which had no plans of reusing. The case study shows a typical scenario of a typical market-oriented strategy that has positive impacts on society. It serves not only for profit but also for offering employment to the youth and conserving the environment. The government of Indonesia and the other countries where the company is operation enjoy a boost in GDP.
How tropical salvages have been effective
Tropical Salvages has been effective in conserving the environment and effective use of natural resources especially wood. The strategies used to acquire raw material has a positive social impact. The company demolishes old buildings, boats, and bridges to obtain the raw material. Rivers, lakes, and trees entombed in the round also serve as a source of raw material to the company. The environment if left clean and due to the search for salvaged wood. Apart from initiating environmental conservation, the company also offers employment to the craftsmen which improve their quality of life. It shows that Tropical salvages efforts to impact the community has been successful
Increased sales in the company have made Tropical Salvage increase its revenue. The company has been performing well due to its good image created by the efforts to conserve the environment and offer employment to the youth. Its good performance in Indonesia made Tim O’Brien to seek an expansion plan into other economies. It easier for the company to expand to other markets because of its reputation in the social and environmental mission. The leadership of Tim O’Brien has ensured that there are several projects including forest restoration and environmental education projects. The use of skillful construction techniques has also contributed to the success of the company. Its skillful workforce constructs sturdy and functional designs that perform well in the market. The company dominates the furniture and wood market which enables it to survive the financial crisis. There is little competition in the market that allows it to operate comfortably and offer reasonable prices. The quality of furniture and woodworks that are produced are high and embrace the use of technology in production making it hard for new entrants into the market.
During the 2008 financial crisis, most of the businesses that were in the furniture market were struggling to keep their doors. However, Tropical salvage continued to be operational despite the tough financial times. The company did not suffer a decline in sales as most businesses had. The company’s survival is attributed to the good leadership of the company. Under the leadership of Tim O’Brien, a sustainable business model was built for ten years. The business model was based on environmental conservation, employee empowerment and a high-quality product at a fair price enabled the company to survive. The survival of the 2008 financial crisis gave O’Brien the motivation to expand and grow the company further.
The undertaking of market research
The company’s growth and expansion strategy required the Tropical Salvage to undertake market research. The growth strategy includes opening branded retail stores in the United States and diversifying the products produced beyond furniture. Growth and expansion of a business are not an easy task and has a lot of challenges involved. Some of the challenges include brand awareness financing and operational efficiency. Tim O’Brien had to ensure that he overcomes these challenges for an effective growth strategy. The company is in a good position to overcome these challenges because it incorporates a social mission, employs cost-competitive sourcing and production of unique designs. The company should adhere to its founding mission of conserving the environment even as it seeks to make profits from the market. Tropical salvage move to expand its products beyond furniture makes it lose its original mission. It may have a hard time rebranding as a company that is out to make profits rather than focus on the social mission of offering employment and environmental conservation. To employ both strategies O’Brien should ensure that he gets into the market careful and venture into products that align with the company’s mission.
Marketing
The company’s expansion and growth efforts have to incorporate the marketing side of the business. Marketing gives the company an easy time to enter the market and increase sales. An effective marketing strategy would go a long way in enabling Tropical Salvage to grow. O’Brien has to factor in the issue of finances in the quest to expand. Expansion of business required a lot of capital to ensure the process is smooth. Clever ways to acquire expansion capital is crucial to ensure that the current operation of the business is not affected. O’Brien can opt for debt financing, retained earnings or venture capital to finance the expansion. It is advised to weigh the pro and cons of a financing option before settling for one
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