Case Study Description of Ceres Gardening Company: Funding Growth in Organic Products
When students have the English-language PDF of this Brief Case in a coursepack, they will also have the option to purchase an audio version.Ceres is a leading player in the growing organic gardening industry, selling seeds, small plants, and related items. Their distribution depends heavily on retail sales through independent nurseries and garden centers. Because these small dealers are unable to finance much inventory, Ceres has crafted its GetCeresa„¢ program, which offers steep discounts and vendor financing. Ceres hopes both to accelerate its penetration into new retail accounts and to encourage dealers to accept more inventory in anticipation of seasonal sales. A key focus of the case is the relationship between marketing strategy and credit policy. The case invites students to analyze a range of financial information and to make financial projections; a student spreadsheet (product 4019) is available free of charge.
Swot Analysis of "Ceres Gardening Company: Funding Growth in Organic Products" written by John H. McArthur, Sunru Yong includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Ceres Gardening facing as an external strategic factors. Some of the topics covered in Ceres Gardening Company: Funding Growth in Organic Products case study are - Strategic Management Strategies, Financial management, Growth strategy, Marketing, Sales and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Ceres Gardening Company: Funding Growth in Organic Products casestudy better are - – wage bills are increasing, customer relationship management is fast transforming because of increasing concerns over data privacy, central banks are concerned over increasing inflation, increasing transportation and logistics costs, increasing government debt because of Covid-19 spendings, increasing household debt because of falling income levels, increasing energy prices,
digital marketing is dominated by two big players Facebook and Google, challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of Ceres Gardening Company: Funding Growth in Organic Products
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Ceres Gardening Company: Funding Growth in Organic Products case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Ceres Gardening, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Ceres Gardening 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 Ceres Gardening Company: Funding Growth in Organic Products can be done for the following purposes –
1. Strategic planning using facts provided in Ceres Gardening Company: Funding Growth in Organic Products case study
2. Improving business portfolio management of Ceres Gardening
3. Assessing feasibility of the new initiative in Finance & Accounting field.
4. Making a Finance & Accounting topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Ceres Gardening
Strengths Ceres Gardening Company: Funding Growth in Organic Products | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Ceres Gardening in Ceres Gardening Company: Funding Growth in Organic Products Harvard Business Review case study are -
Successful track record of launching new products
– Ceres Gardening has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Ceres Gardening 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.
Sustainable margins compare to other players in Finance & Accounting industry
– Ceres Gardening Company: Funding Growth in Organic Products firm has clearly differentiated products in the market place. This has enabled Ceres Gardening to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Ceres Gardening to invest into research and development (R&D) and innovation.
Organizational Resilience of Ceres Gardening
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Ceres Gardening does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Innovation driven organization
– Ceres Gardening is one of the most innovative firm in sector. Manager in Ceres Gardening Company: Funding Growth in Organic Products Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Diverse revenue streams
– Ceres Gardening is present in almost all the verticals within the industry. This has provided firm in Ceres Gardening Company: Funding Growth in Organic Products 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.
Ability to recruit top talent
– Ceres Gardening is one of the leading recruiters in the industry. Managers in the Ceres Gardening Company: Funding Growth in Organic Products are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Superior customer experience
– The customer experience strategy of Ceres Gardening in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Strong track record of project management
– Ceres Gardening is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Highly skilled collaborators
– Ceres Gardening 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 Ceres Gardening Company: Funding Growth in Organic Products HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Learning organization
- Ceres Gardening 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 Ceres Gardening is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Ceres Gardening Company: Funding Growth in Organic Products Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Analytics focus
– Ceres Gardening is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by John H. McArthur, Sunru Yong can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
High brand equity
– Ceres Gardening has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Ceres Gardening to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses Ceres Gardening Company: Funding Growth in Organic Products | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Ceres Gardening Company: Funding Growth in Organic Products are -
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Ceres Gardening Company: Funding Growth in Organic Products, is just above the industry average. Ceres Gardening needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Ceres Gardening Company: Funding Growth in Organic Products HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Ceres Gardening has relatively successful track record of launching new products.
Need for greater diversity
– Ceres Gardening has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Lack of clear differentiation of Ceres Gardening products
– To increase the profitability and margins on the products, Ceres Gardening needs to provide more differentiated products than what it is currently offering in the marketplace.
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 Ceres Gardening supply chain. Even after few cautionary changes mentioned in the HBR case study - Ceres Gardening Company: Funding Growth in Organic Products, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Ceres Gardening vulnerable to further global disruptions in South East Asia.
Products dominated business model
– Even though Ceres Gardening has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Ceres Gardening Company: Funding Growth in Organic Products should strive to include more intangible value offerings along with its core products and services.
Low market penetration in new markets
– Outside its home market of Ceres Gardening, firm in the HBR case study Ceres Gardening Company: Funding Growth in Organic Products needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow decision making process
– As mentioned earlier in the report, Ceres Gardening has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Ceres Gardening even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Interest costs
– Compare to the competition, Ceres Gardening has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Aligning sales with marketing
– It come across in the case study Ceres Gardening Company: Funding Growth in Organic Products that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Ceres Gardening Company: Funding Growth in Organic Products can leverage the sales team experience to cultivate customer relationships as Ceres Gardening is planning to shift buying processes online.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Ceres Gardening Company: Funding Growth in Organic Products, in the dynamic environment Ceres Gardening has struggled to respond to the nimble upstart competition. Ceres Gardening has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Opportunities Ceres Gardening Company: Funding Growth in Organic Products | 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 Ceres Gardening Company: Funding Growth in Organic Products are -
Better consumer reach
– The expansion of the 5G network will help Ceres Gardening to increase its market reach. Ceres Gardening 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Finance & Accounting industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Ceres Gardening 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. Ceres Gardening 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Ceres Gardening can use these opportunities to build new business models that can help the communities that Ceres Gardening operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Ceres Gardening is facing challenges because of the dominance of functional experts in the organization. Ceres Gardening Company: Funding Growth in Organic Products case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Learning at scale
– Online learning technologies has now opened space for Ceres Gardening to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Leveraging digital technologies
– Ceres Gardening can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Ceres Gardening 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, Ceres Gardening Company: Funding Growth in Organic Products, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Using analytics as competitive advantage
– Ceres Gardening has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Ceres Gardening Company: Funding Growth in Organic Products - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Ceres Gardening to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Creating value in data economy
– The success of analytics program of Ceres Gardening has opened avenues for new revenue streams for the organization in the industry. This can help Ceres Gardening to build a more holistic ecosystem as suggested in the Ceres Gardening Company: Funding Growth in Organic Products case study. Ceres Gardening can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Ceres Gardening in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Finance & Accounting segment, and it will provide faster access to the consumers.
Low interest rates
– Even though inflation is raising its head in most developed economies, Ceres Gardening 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.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Ceres Gardening to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Ceres Gardening to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Ceres Gardening to hire the very best people irrespective of their geographical location.
Threats Ceres Gardening Company: Funding Growth in Organic Products External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Ceres Gardening Company: Funding Growth in Organic Products are -
Shortening product life cycle
– it is one of the major threat that Ceres Gardening is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Easy access to finance
– Easy access to finance in Finance & Accounting field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Ceres Gardening can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Environmental challenges
– Ceres Gardening 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. Ceres Gardening can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
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. Ceres Gardening 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.
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 Ceres Gardening business can come under increasing regulations regarding data privacy, data security, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Ceres Gardening 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 Ceres Gardening Company: Funding Growth in Organic Products .
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Ceres Gardening Company: Funding Growth in Organic Products, Ceres Gardening may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Finance & Accounting .
Increasing wage structure of Ceres Gardening
– 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 Ceres Gardening.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Ceres Gardening with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Ceres Gardening.
Stagnating economy with rate increase
– Ceres Gardening 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.
Technology acceleration in Forth Industrial Revolution
– Ceres Gardening has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Ceres Gardening needs to keep up with the evolution of technology in the Finance & Accounting 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 Ceres Gardening Company: Funding Growth in Organic Products 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 Ceres Gardening Company: Funding Growth in Organic Products 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 Ceres Gardening Company: Funding Growth in Organic Products 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 Ceres Gardening Company: Funding Growth in Organic Products 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 Ceres Gardening Company: Funding Growth in Organic Products 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 Ceres Gardening needs to make to build a sustainable competitive advantage.