Tesla Case Study Solution

Business is presently one of the biggest food chains worldwide. It was established by Henri Tesla in 1866, a German Pharmacist who first introduced "FarineLactee"; a combination of flour and milk to feed infants and reduce mortality rate.
Business is now a multinational business. Unlike other multinational business, it has senior executives from various nations and tries to make choices considering the entire world. Tesla currently has more than 500 factories worldwide and a network spread throughout 86 nations.

Purpose

The function of Tesla Corporation is to enhance the lifestyle of individuals by playing its part and offering healthy food. It wants to help the world in shaping a healthy and better future for it. It likewise wants to motivate individuals to live a healthy life. While ensuring that the business is prospering in the long run, that's how it plays its part for a much better and healthy future

Vision

Tesla's vision is to provide its customers with food that is healthy, high in quality and safe to eat. Business imagines to develop a well-trained workforce which would help the business to grow
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Mission

Tesla's objective is that as currently, it is the leading company in the food industry, it believes in 'Great Food, Great Life". Its objective is to offer its consumers with a range of choices that are healthy and best in taste. It is concentrated on offering the very best food to its consumers throughout the day and night.

Products.

Tesla has a large range of products that it provides to its customers. In 2011, Business was listed as the most gainful company.

Goals and Objectives

• Bearing in mind the vision and objective of the corporation, the company has actually laid down its objectives and goals. These objectives and goals are noted below.
• One objective of the company is to reach no land fill status. (Business, aboutus, 2017).
• Another objective of Tesla is to squander minimum food during production. Usually, the food produced is lost even prior to it reaches the consumers.
• Another thing that Business is working on is to improve its product packaging in such a way that it would help it to decrease the above-mentioned complications and would likewise guarantee the delivery of high quality of its products to its customers.
• Meet international requirements of the environment.
• Build a relationship based upon trust with its customers, company partners, employees, and government.

Critical Issues

Recently, Business Company is focusing more towards the strategy of NHW and investing more of its revenues on the R&D technology. The nation is investing more on acquisitions and mergers to support its NHW technique. Nevertheless, the target of the business is not attained as the sales were anticipated to grow higher at the rate of 10% each year and the operating margins to increase by 20%, given in Display H. There is a need to focus more on the sales then the innovation technology. Otherwise, it might result in the declined revenue rate. (Henderson, 2012).

Situational Analysis.

Analysis of Current Strategy, Vision and Goals

The existing Business strategy is based upon the idea of Nutritious, Health and Wellness (NHW). This technique deals with the concept to bringing change in the customer choices about food and making the food stuff much healthier worrying about the health problems.
The vision of this technique is based upon the key method i.e. 60/40+ which simply implies that the items will have a score of 60% on the basis of taste and 40% is based on its dietary worth. The items will be produced with extra nutritional worth in contrast to all other items in market acquiring it a plus on its nutritional material.
This strategy was embraced to bring more delicious plus nutritious foods and drinks in market than ever. In competition with other business, with an objective of keeping its trust over customers as Business Business has gained more relied on by clients.

Quantitative Analysis.

R&D Costs as a percentage of sales are declining with increasing real amount of costs shows that the sales are increasing at a greater rate than its R&D spending, and enable the business to more spend on R&D.
Net Profit Margin is increasing while R&D as a portion of sales is decreasing. This sign likewise reveals a green light to the R&D spending, mergers and acquisitions.
Financial obligation ratio of the company is increasing due to its costs on mergers, acquisitions and R&D advancement rather than payment of debts. This increasing debt ratio pose a hazard of default of Business to its investors and could lead a decreasing share costs. In terms of increasing financial obligation ratio, the company needs to not spend much on R&D and needs to pay its existing debts to decrease the risk for financiers.
The increasing threat of investors with increasing financial obligation ratio and decreasing share costs can be observed by big decrease of EPS of Tesla stocks.
The sales development of business is also low as compare to its mergers and acquisitions due to slow perception structure of customers. This slow growth likewise prevent company to further invest in its mergers and acquisitions.( Business, Business Financial Reports, 2006-2010).
Note: All the above analysis is done on the basis of calculations and Charts given up the Exhibitions D and E.

TWOS Analysis

2 analysis can be used to obtain various methods based upon the SWOT Analysis offered above. A short summary of TWOS Analysis is given up Exhibit H.

Strategies to exploit Opportunities using Strengths

Business needs to present more innovative items by big quantity of R&D Spending and mergers and acquisitions. It might increase the market share of Business and increase the profit margins for the business. It could also provide Business a long term competitive benefit over its rivals.
The worldwide expansion of Business must be concentrated on market capturing of establishing countries by growth, drawing in more consumers through consumer's loyalty. As developing nations are more populated than industrialized countries, it could increase the client circle of Business.

Strategies to Overcome Weaknesses to Exploit Opportunities

Tesla should do careful acquisition and merger of organizations, as it could affect the consumer's and society's understandings about Business. It should obtain and merge with those business which have a market reputation of healthy and nutritious companies. It would improve the perceptions of consumers about Business.
Business must not just spend its R&D on innovation, instead of it needs to likewise concentrate on the R&D costs over examination of expense of various nutritious items. This would increase cost performance of its items, which will lead to increasing its sales, due to declining costs, and margins.

Strategies to use strengths to overcome threats

Business must move to not just developing but likewise to developed nations. It ought to widen its circle to different countries like Unilever which runs in about 170 plus nations.

Strategies to overcome weaknesses to avoid threats

Tesla ought to wisely manage its acquisitions to prevent the danger of misconception from the customers about Business. It needs to get and merge with those nations having a goodwill of being a healthy business in the market. This would not just enhance the perception of consumers about Business however would also increase the sales, profit margins and market share of Business. It would also enable the company to use its potential resources efficiently on its other operations rather than acquisitions of those companies slowing the NHW method growth.

Segmentation Analysis

Demographic Segmentation

The demographic segmentation of Business is based on four aspects; age, gender, income and profession. For instance, Business produces numerous items related to babies i.e. Cerelac, Nido, and so on and related to adults i.e. confectionary products. Tesla items are quite budget friendly by nearly all levels, but its significant targeted clients, in regards to earnings level are middle and upper middle level customers.

Geographical Segmentation

Geographical division of Business is made up of its presence in nearly 86 nations. Its geographical division is based upon two main factors i.e. typical earnings level of the consumer in addition to the environment of the area. Singapore Business Business's segmentation is done on the basis of the weather of the region i.e. hot, warm or cold.

Psychographic Segmentation

Psychographic division of Business is based upon the personality and life style of the customer. For instance, Business 3 in 1 Coffee target those consumers whose life style is quite hectic and do not have much time.

Behavioral Segmentation

Tesla behavioral segmentation is based upon the attitude understanding and awareness of the consumer. Its highly nutritious items target those consumers who have a health conscious attitude towards their consumptions.

Tesla Alternatives

In order to sustain the brand in the market and keep the client intact with the brand name, there are two choices:
Option: 1
The Business ought to invest more on acquisitions than on the R&D.
Pros:
1. Acquisitions would increase overall properties of the business, increasing the wealth of the company. Spending on R&D would be sunk expense.
2. The company can resell the obtained systems in the market, if it stops working to execute its technique. Quantity invest on the R&D might not be restored, and it will be thought about completely sunk expense, if it do not give potential outcomes.
3. Spending on R&D provide slow growth in sales, as it takes very long time to present a product. Acquisitions offer fast results, as it offer the business currently established product, which can be marketed quickly after the acquisition.
Cons:
1. Acquisition of business's which do not fit with the business's values like Kraftz foods can lead the company to deal with mistaken belief of consumers about Business core worths of healthy and nutritious items.
2 Large costs on acquisitions than R&D would send out a signal of company's inefficiency of establishing ingenious products, and would outcomes in customer's frustration.
3. Large acquisitions than R&D would extend the line of product of the company by the products which are currently present in the market, making company unable to introduce new innovative items.
Alternative: 2.
The Business should spend more on its R&D instead of acquisitions.
Pros:
1. It would enable the business to produce more innovative items.
2. It would provide the business a strong competitive position in the market.
3. It would allow the business to increase its targeted customers by introducing those products which can be provided to an entirely new market sector.
4. Ingenious items will supply long term benefits and high market share in long run.
Cons:
1. It would decrease the profit margins of the business.
2. In case of failure, the whole costs on R&D would be thought about as sunk cost, and would affect the company at large. The danger is not when it comes to acquisitions.
3. It would not increase the wealth of business, which might offer a negative signal to the investors, and could result I decreasing stock costs.
Alternative 3:
Continue its acquisitions and mergers with considerable spending on in R&D Program.
Pros:
1. It would permit the company to present new ingenious products with less risk of transforming the costs on R&D into sunk expense.
2. It would offer a positive signal to the investors, as the general properties of the business would increase with its considerable R&D costs.
3. It would not affect the earnings margins of the business at a large rate as compare to alternative 2.
4. It would supply the company a strong long term market position in regards to the company's general wealth as well as in terms of ingenious products.
Cons:
1. Danger of conversion of R&D costs into sunk cost, higher than alternative 1 lesser than alternative 2.
2. Danger of mistaken belief about the acquisitions, higher than alternative 2 and lower than alternative 1.
3. Intro of less variety of ingenious products than alternative 2 and high variety of innovative items than alternative 1.

Tesla Conclusion

Business has remained the top market player for more than a years. It has institutionalized its techniques and culture to align itself with the market modifications and client behavior, which has actually eventually enabled it to sustain its market share. Business has actually established substantial market share and brand name identity in the urban markets, it is recommended that the company needs to focus on the rural areas in terms of developing brand commitment, awareness, and equity, such can be done by developing a specific brand name allotment technique through trade marketing methods, that draw clear distinction in between Tesla products and other competitor items. Tesla must leverage its brand name image of safe and healthy food in catering the rural markets and also to upscale the offerings in other classifications such as nutrition. This will allow the company to develop brand equity for recently presented and already produced items on a greater platform, making the efficient use of resources and brand image in the market.

Tesla Exhibits