Case Study Description of Fueling Sales at EuroPet
EuroPet S.A. was a multinational company operating gas stations in many European countries. There was a growing propensity for supermarkets to attach gas stations to their retail operations, which was developing into a major threat to EuroPet. As a result, in the mid-1990s, the company began to develop and brand its own convenience stores co-located with its gas stations. However, the company was spending much more on advertising the convenience stores than its competitors did. Management now had to decide if the increase in sales attributed to advertising efforts justified the advertising spend by analyzing the market data from one large metropolitan area: Marseille, France.
Swot Analysis of "Fueling Sales at EuroPet" written by Karl Schmedders, I. Campbell Lyle includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Europet Stations facing as an external strategic factors. Some of the topics covered in Fueling Sales at EuroPet case study are - Strategic Management Strategies, Decision making, Economics, Financial analysis, Marketing and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Fueling Sales at EuroPet casestudy better are - – supply chains are disrupted by pandemic , increasing household debt because of falling income levels, increasing inequality as vast percentage of new income is going to the top 1%, banking and financial system is disrupted by Bitcoin and other crypto currencies, competitive advantages are harder to sustain because of technology dispersion, cloud computing is disrupting traditional business models, central banks are concerned over increasing inflation,
increasing commodity prices, geopolitical disruptions, etc
Introduction to SWOT Analysis of Fueling Sales at EuroPet
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Fueling Sales at EuroPet case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Europet Stations, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Europet Stations operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Fueling Sales at EuroPet can be done for the following purposes –
1. Strategic planning using facts provided in Fueling Sales at EuroPet case study
2. Improving business portfolio management of Europet Stations
3. Assessing feasibility of the new initiative in Sales & Marketing field.
4. Making a Sales & Marketing topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Europet Stations
Strengths Fueling Sales at EuroPet | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Europet Stations in Fueling Sales at EuroPet Harvard Business Review case study are -
Diverse revenue streams
– Europet Stations is present in almost all the verticals within the industry. This has provided firm in Fueling Sales at EuroPet case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Successful track record of launching new products
– Europet Stations has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Europet Stations has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
High brand equity
– Europet Stations has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Europet Stations to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Strong track record of project management
– Europet Stations is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Effective Research and Development (R&D)
– Europet Stations has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Fueling Sales at EuroPet - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to lead change in Sales & Marketing field
– Europet Stations is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Europet Stations in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Training and development
– Europet Stations has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Fueling Sales at EuroPet Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Sustainable margins compare to other players in Sales & Marketing industry
– Fueling Sales at EuroPet firm has clearly differentiated products in the market place. This has enabled Europet Stations to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Europet Stations to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– Europet Stations has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Fueling Sales at EuroPet HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Operational resilience
– The operational resilience strategy in the Fueling Sales at EuroPet Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Superior customer experience
– The customer experience strategy of Europet Stations in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Learning organization
- Europet Stations is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Europet Stations is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Fueling Sales at EuroPet Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Weaknesses Fueling Sales at EuroPet | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Fueling Sales at EuroPet are -
High cash cycle compare to competitors
Europet Stations has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Slow to strategic competitive environment developments
– As Fueling Sales at EuroPet HBR case study mentions - Europet Stations takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Fueling Sales at EuroPet, it seems that the employees of Europet Stations don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Europet Stations supply chain. Even after few cautionary changes mentioned in the HBR case study - Fueling Sales at EuroPet, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Europet Stations vulnerable to further global disruptions in South East Asia.
Skills based hiring
– The stress on hiring functional specialists at Europet Stations has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Europet Stations is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Fueling Sales at EuroPet can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Increasing silos among functional specialists
– The organizational structure of Europet Stations is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Europet Stations needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Europet Stations to focus more on services rather than just following the product oriented approach.
High bargaining power of channel partners
– Because of the regulatory requirements, Karl Schmedders, I. Campbell Lyle suggests that, Europet Stations is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
No frontier risks strategy
– After analyzing the HBR case study Fueling Sales at EuroPet, it seems that company is thinking about the frontier risks that can impact Sales & Marketing strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Workers concerns about automation
– As automation is fast increasing in the segment, Europet Stations needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
High operating costs
– Compare to the competitors, firm in the HBR case study Fueling Sales at EuroPet has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Europet Stations 's lucrative customers.
Opportunities Fueling Sales at EuroPet | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Fueling Sales at EuroPet are -
Better consumer reach
– The expansion of the 5G network will help Europet Stations to increase its market reach. Europet Stations will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Creating value in data economy
– The success of analytics program of Europet Stations has opened avenues for new revenue streams for the organization in the industry. This can help Europet Stations to build a more holistic ecosystem as suggested in the Fueling Sales at EuroPet case study. Europet Stations can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Building a culture of innovation
– managers at Europet Stations can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Sales & Marketing segment.
Low interest rates
– Even though inflation is raising its head in most developed economies, Europet Stations can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Europet Stations in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Sales & Marketing segment, and it will provide faster access to the consumers.
Manufacturing automation
– Europet Stations can use the latest technology developments to improve its manufacturing and designing process in Sales & Marketing segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Europet Stations can use these opportunities to build new business models that can help the communities that Europet Stations operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Europet Stations can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Fueling Sales at EuroPet, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Buying journey improvements
– Europet Stations can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Fueling Sales at EuroPet suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Sales & Marketing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Europet Stations can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Europet Stations can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Loyalty marketing
– Europet Stations has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Developing new processes and practices
– Europet Stations can develop new processes and procedures in Sales & Marketing industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Sales & Marketing industry, but it has also influenced the consumer preferences. Europet Stations can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats Fueling Sales at EuroPet External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Fueling Sales at EuroPet are -
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Europet Stations will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Easy access to finance
– Easy access to finance in Sales & Marketing field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Europet Stations can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Europet Stations business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– Europet Stations can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Europet Stations in the Sales & Marketing sector and impact the bottomline of the organization.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Europet Stations needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Increasing wage structure of Europet Stations
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Europet Stations.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Europet Stations can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Fueling Sales at EuroPet .
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Europet Stations.
Shortening product life cycle
– it is one of the major threat that Europet Stations is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Environmental challenges
– Europet Stations needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Europet Stations can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
High dependence on third party suppliers
– Europet Stations high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Technology acceleration in Forth Industrial Revolution
– Europet Stations has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Europet Stations needs to keep up with the evolution of technology in the Sales & Marketing sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Weighted SWOT Analysis of Fueling Sales at EuroPet Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Fueling Sales at EuroPet needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Fueling Sales at EuroPet is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Fueling Sales at EuroPet is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Fueling Sales at EuroPet is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Europet Stations needs to make to build a sustainable competitive advantage.