Long-champ Case Solution
1.Separate Business Segments – Le Pilage & Leather Products
The second alternative for the company is to keep the Le Pilage brand a separate business unit and introduce a new segment of luxurious leather products. This alternative could resolve the management's concerns regarding the shifting industry’s lifestyles and the adoption of luxurious high prices leather products.
Pros
With this alternative, the company would be able to grab high priced luxurious leather bags market without comprising on the Le Pilage market. The adoption two different business segments would enable the company to enjoy a wider market share and ultimately higher profitability.
Cons
A trouble might incur as the company might lose its focus towards the Le Pilage brand as the high priced products are considered more attractive from the management’s perspective. The alternative is workable if the two business segments are focused by the management as a single company, not just on the basis of profitability.
Criteria
The key rationale on the basis of which decision is made, included the future industry expectation and the company’s profitability. The alternative, which provides the higher profitability and meets the changing dynamics of the industry, would be taken as the recommended solution.
Decision
It is recommended that the company should continue Le Pilage but as a separate business segment along with high priced leather bags’ segment. It is because the Le Pilage brand is considered as iconic brand and it’s widely accepted by the market. The company can sell a low priced product in higher volumes alongside the selling of leather products. This would ultimately result in a higher profitability and a wider market share.
Implementation Plan
In order to get the suggested alternative implemented, the company’s management should increase its distribution network and promotion of Le Pilage brand. Through this way, the company would be able to have more control on the luxurious high priced leather goods without compromising on its traditional brand’s market...........................
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