Bronner Slosberg Humphrey Case

Situational Analysis

In 1975 Ruth M. Owades joined The Avion Group where she became the Director of Marketing.

The Avion Group consisted of seven mail order companies, which had all been acquired after achieving good individual success. These companies had flourished within Avion, which had had spectacular growth.

While working with these companies she found out that many people who buy by mail have a lot of hobbies & one hobby that kept on coming in her analysis was gardening. In 1978 seeing an opportunity she offered a proposal to her Chairman to start with a 'Gardening Catalogue'.

The Avion Group after showing keen interest in her proposal in the beginning later became reluctant, as they had never started a company on their own. They raised a lot of questions & hypothetical issues, which Ruth was unable to answer. Nobody was ready to support her. Ruth was very enthusiastic about the whole project & really wanted to go on with it.

She did a research on the whole thing making contacts, arranging the finance, office, warehouse etc. & all other things that would be required.

She now faced a situation where she had to decide whether to stick with her job or leave her job & start the project on her own.

A SWOT analysis will provide us with the strengths, weaknesses, opportunities and threats of Ruth M. Owades which will further help in identifying the key issues.

It can be divided into two parts:

1. Internal Analysis: Strengths & Weaknesses

2. External Analysis: Opportunities & Threats

SWOT Analysis

Strengths

1. Ruth M. Owades was highly motivated & enthusiastic about the project

2. She had good experience in the mail order business & knew the fundamentals to success

3. She had quite a good no. of contacts

4. At Avion she was always involved with cost cutting & saving

5. Her family members are not dependent on her

6. She arranged for an office & managed to bring down the rent to practically nothing

7. She was able to arrange the warehouse with packaging & shipping facilities at a low cost

8. She arranged for the finance

9. She got the 51% of the equity where as she only had to invest 25% of the total amount being invested

10. Her husbands support

Weaknesses

1. She had never started any business before

2. Lack of funds

Opportunities

1. Many people have a common hobby that was gardening

2. Gardening was very popular in US with various gardening magazines for sale

3. 62% of Avion's mail order customers showed an interest in gardening

4. She thought there was a market niche which she wanted to fill

5. No competitors in the related area

6. Encouragement from Doane Associates

Threats

1. 90% of the new companies fail

2. The economy was soft

3. Time was running