Here is what we have so far from our group discussion board. Let's all try and edit this and make it ready to turn in by the 30th. Strengths (micro)
Strong internet market, also has extensive catalogue to reach customers without internet.
Wide range of suppliers. Supports growth of minority, women, and small business suppliers through it's Supplier Diversity Program.
Extensive distribution channels
Variety of products: Call2Recycle, Hazardous Recycling Services, Safety Services, Storage Equipment and Installation, Grainger Tripleguard Repair and Replacement Coverage.
Serves 153 countries with its network of branches distribution centers and web sites.
Uses direct marketing, sales representatives, catalog and internet to reach customers
Uses over 3,000 suppliers to meet the needs of its customers
Distributes over 900,000 products
Opened its Grainger.com website with online ordering capabilities in June, 1995; therefore, the company has over ten years of e-commerce experience.
Offer procurement and inventory management solutions for customers
Have customer accounts which can be billed at later date in additon to accepting credit cards
Login box for customers is easy to locate - always on same corner of page for every page of website
Offer product comparisons for customer to compare similar items
Weaknesses
Grainger has a heavy U.S. focus. (W.W. Grainger, INC. And Subsidiaries; Financial Highlights)
· Grainger only has a 3% share of the small and medium-sized businesses. These businesses account for 80% of the market. (W.W. Grainger, INC. And Subsidiaries; Financial Highlights) · “Grainger has the most short-cycle MRO (maintenance, repair, and operating) exposure” (Grainger W W INC, 2011). · Grainger employees that work in customer service and sales do not have technical knowledge about their products. (Heller, 2010) · Economic and industry trends affects their business environments. Weakness in the economy can take away the customer’s ability to purchase products from Grainger. · “The facilities maintenance industry is highly fragmented, and changes in competition could result in a decreased demand for Grainger’s products and services”. · “Volatility in commodity prices may adversely affect operating margins”.
· (United States Securities and Exchange Commission)
Opportunities
To promote new products that are offered, create a “New Product Spotlight; Check out all the latest products” link on the homepage.
There should be a link on the homepage for a “live chat” with a Grainger service representative. The customer could even click on different types of “specialists” that could answer specific questions about Grainger products or help the customer solve problems in their own business through the use of Grainger products or services.
They should have a subscription on the homepage to a Grainger newsletter. This could be an electronic newsletter that is e-mailed to customers to share pertinent industrial or business information.
Grainger could use webcast or podcasts to share information about new Grainger products r how to use Grainger products to benefit a customer’s business.
Grainger needs to make better use of social networking through blogs. They should have company representatives set up blogs, as well as, add to other existing blogs about industrial products and the industry.
More video content could be added to the website. There could be testimonials from happy customers or examples of how Grainger products can be used to help companies.
Grainger should add a “Fast Order Pad” on right side of the home page. If you know the item number and need no other information this is an excellent service for the site to provide the consumer to bypass catalog pages.
Grainger needs to improve the store locator option on its homepage. Competitors offer easier-to-find and more detailed maps of store locations.
Grainger needs to have links for Facebook, Twitter, and YouTube on their home page. This might be something Granger could utilize for customer forums to discuss products and services.
Threats , Micro threat-Offering environmentally unfriendly products for sale There is significant risk to the Grainger brand involved in providing electrical components, industrial supplies, HACVR supplies, and raw materials that might pose a threat to the environment. With the current green initiatives both in the US and globally, many items that Grainger offers fall into the category of environmentally unfriendly products. This could create serious backlash to the company and damage to the brand reputation. Even though Grainger offers a number of green products and even has a green section on the website, one bad product could damage years of positive responsible service to the industry. An example of this is the problems created for companies who sold asbestos products up until the 1980’s. Listed below are a couple of links that address different concerns with this issue. http://www.hks.harvard.edu/m-rcbg/CSRI/publications/workingpaper_10_kytle_ruggie.pdf http://news.randburg.com/30/valley-industrial-promotes-own-range-of-eco-friendly-cleaning-products/ http://www.all-greenjanitorialproducts.com/ http://www.time.com/time/magazine/article/0,9171,1609476,00.html 2, Micro threat-A lack of internal quality control on products due to outsourcing overseas. There is significant risk to the Grainger brand involved in purchasing items for resale from overseas because of the lack of control over product quality. Not that those products are always of a lesser quality but typically, the more that products are produced locally the more a company can oversee the quality of those products. Grainger currently gets many products from overseas markets, especially China. Just a single inferior product, especially with a large account such as a government contract, can damage the Grainger brand image. Listed below are a couple of links to information concerning this issue. http://www.hankinbank.com/Commentary/Commentary%20HIB/e-Commerce%20Distribution.html http://walworthcountytoday.com/news/2010/mar/14/ww-grainger-looking-grow-janesville/ 3, Macro threat-A significant cost increases due to a scarcity of copper. Due to the use of copper in all electric motors and it being one of the primary metals in many current technology products it is a valuable commodity to Grainger. This issue poses a threat industry wide. Copper use has been rising at a substantial rate for a number of years especially with the exponential use of it in computer applications. China and India continue to consume much of the global supply of copper primarily due to their production of electrical communications and computing equipment. I found the following information concerning this issue at: http://uk.reuters.com/article/idUKLNE59702Z20091008 "We do not consider copper's demand prospects among the best, but we believe the copper-producing industry will have the most difficulty keeping up with growing demand.” Further proof of copper demand is the upswing in copper theft in the United States in recent years. Listed below are a couple of links with information concerning the issue of copper theft. http://www.scrapmonster.com/news/copper-theft-rises-on-soaring-prices/1/75 http://www.fbi.gov/news/stories/2008/december/copper_120308 Another good article is:http://www.reuters.com/article/idUSLDE70C10C20110113. This link talks about China’s consumption of raw metals. “China is the world's leading metals consumer, said to account for nearly 40percent of global copper consumption estimated at around 19 million tonnes.” 4, Macro threat-Budget cuts by state government institutions, municipalities, hospitals, and schools due to the lingering depressed economy There is a significant reduction in the purchase of products and services by many public institutions because of the lack of funding due to a decrease in tax revenue as a repercussion of the recent recession. This is a threat not only to Granger but the industry as a whole. This problem will probably continue for the foreseeable future in many states and municipalities. The state of IL is a prime example of how we must do more with less because of substantial budget cuts. Schools, cities, counties, and state funded institutions will have to find ways to make do with fewer industrial products and supplies. The following article discusses how the American Recovery and Reinvestment Act is helping states and municipalities cope with substantial budget cuts which includes the purchase of industrial supplies and products:http://www.bos.frb.org/economic/ppb/2010/ppb101.pdf. Other articles that address this issue are:http://sunshinereview.org/index.php/Missouri_state_budget,http://www.ajc.com/opinion/deep-freeze-2011-state-804598.html,http://www.wickedlocal.com/weston/news/opinions/x806162263/Editorial-Bay-State-cant-afford-Question-3, &http://articles.chicagotribune.com/2008-07-26/business/0807250802_1_government-and-share-suit-costly-legal-fees
Here is what we have so far from our group discussion board. Let's all try and edit this and make it ready to turn in by the 30th.
Strengths (micro)
- Strong internet market, also has extensive catalogue to reach customers without internet.
- Wide range of suppliers. Supports growth of minority, women, and small business suppliers through it's Supplier Diversity Program.
- Extensive distribution channels
- Variety of products: Call2Recycle, Hazardous Recycling Services, Safety Services, Storage Equipment and Installation, Grainger Tripleguard Repair and Replacement Coverage.
- Serves 153 countries with its network of branches distribution centers and web sites.
- Uses direct marketing, sales representatives, catalog and internet to reach customers
- Uses over 3,000 suppliers to meet the needs of its customers
- Distributes over 900,000 products
- Opened its Grainger.com website with online ordering capabilities in June, 1995; therefore, the company has over ten years of e-commerce experience.
- Offer procurement and inventory management solutions for customers
- Have customer accounts which can be billed at later date in additon to accepting credit cards
- Login box for customers is easy to locate - always on same corner of page for every page of website
- Offer product comparisons for customer to compare similar items
WeaknessesGrainger has a heavy U.S. focus. (W.W. Grainger, INC. And Subsidiaries; Financial Highlights)
· Grainger only has a 3% share of the small and medium-sized businesses. These businesses account for 80% of the market. (W.W. Grainger, INC. And Subsidiaries; Financial Highlights)
· “Grainger has the most short-cycle MRO (maintenance, repair, and operating) exposure” (Grainger W W INC, 2011).
· Grainger employees that work in customer service and sales do not have technical knowledge about their products. (Heller, 2010)
· Economic and industry trends affects their business environments. Weakness in the economy can take away the customer’s ability to purchase products from Grainger.
· “The facilities maintenance industry is highly fragmented, and changes in competition could result in a decreased demand for Grainger’s products and services”.
· “Volatility in commodity prices may adversely affect operating margins”.
· (United States Securities and Exchange Commission)
Opportunities
Threats
, Micro threat-Offering environmentally unfriendly products for sale
There is significant risk to the Grainger brand involved in providing electrical components, industrial supplies, HACVR supplies, and raw materials that might pose a threat to the environment. With the current green initiatives both in the US and globally, many items that Grainger offers fall into the category of environmentally unfriendly products. This could create serious backlash to the company and damage to the brand reputation. Even though Grainger offers a number of green products and even has a green section on the website, one bad product could damage years of positive responsible service to the industry. An example of this is the problems created for companies who sold asbestos products up until the 1980’s. Listed below are a couple of links that address different concerns with this issue.
http://www.hks.harvard.edu/m-rcbg/CSRI/publications/workingpaper_10_kytle_ruggie.pdf
http://news.randburg.com/30/valley-industrial-promotes-own-range-of-eco-friendly-cleaning-products/
http://www.all-greenjanitorialproducts.com/
http://www.time.com/time/magazine/article/0,9171,1609476,00.html
2, Micro threat-A lack of internal quality control on products due to outsourcing overseas.
There is significant risk to the Grainger brand involved in purchasing items for resale from overseas because of the lack of control over product quality. Not that those products are always of a lesser quality but typically, the more that products are produced locally the more a company can oversee the quality of those products. Grainger currently gets many products from overseas markets, especially China. Just a single inferior product, especially with a large account such as a government contract, can damage the Grainger brand image. Listed below are a couple of links to information concerning this issue.
http://www.hankinbank.com/Commentary/Commentary%20HIB/e-Commerce%20Distribution.html
http://walworthcountytoday.com/news/2010/mar/14/ww-grainger-looking-grow-janesville/
3, Macro threat-A significant cost increases due to a scarcity of copper.
Due to the use of copper in all electric motors and it being one of the primary metals in many current technology products it is a valuable commodity to Grainger. This issue poses a threat industry wide. Copper use has been rising at a substantial rate for a number of years especially with the exponential use of it in computer applications. China and India continue to consume much of the global supply of copper primarily due to their production of electrical communications and computing equipment. I found the following information concerning this issue at: http://uk.reuters.com/article/idUKLNE59702Z20091008 "We do not consider copper's demand prospects among the best, but we believe the copper-producing industry will have the most difficulty keeping up with growing demand.” Further proof of copper demand is the upswing in copper theft in the United States in recent years. Listed below are a couple of links with information concerning the issue of copper theft.
http://www.scrapmonster.com/news/copper-theft-rises-on-soaring-prices/1/75
http://www.fbi.gov/news/stories/2008/december/copper_120308
Another good article is: http://www.reuters.com/article/idUSLDE70C10C20110113. This link talks about China’s consumption of raw metals. “China is the world's leading metals consumer, said to account for nearly 40percent of global copper consumption estimated at around 19 million tonnes.”
4, Macro threat-Budget cuts by state government institutions, municipalities, hospitals, and schools due to the lingering depressed economy
There is a significant reduction in the purchase of products and services by many public institutions because of the lack of funding due to a decrease in tax revenue as a repercussion of the recent recession. This is a threat not only to Granger but the industry as a whole. This problem will probably continue for the foreseeable future in many states and municipalities. The state of IL is a prime example of how we must do more with less because of substantial budget cuts. Schools, cities, counties, and state funded institutions will have to find ways to make do with fewer industrial products and supplies. The following article discusses how the American Recovery and Reinvestment Act is helping states and municipalities cope with substantial budget cuts which includes the purchase of industrial supplies and products:http://www.bos.frb.org/economic/ppb/2010/ppb101.pdf.
Other articles that address this issue are:http://sunshinereview.org/index.php/Missouri_state_budget,http://www.ajc.com/opinion/deep-freeze-2011-state-804598.html,http://www.wickedlocal.com/weston/news/opinions/x806162263/Editorial-Bay-State-cant-afford-Question-3, &http://articles.chicagotribune.com/2008-07-26/business/0807250802_1_government-and-share-suit-costly-legal-fees