Polaris Industries Inc. Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

External Analysis

The External Factor Evaluation Matrix identifies and evaluates relationship between opportunities and threats. The below opportunities and threats were considered in calculating EFE Matrix score, Polaris scored 2.70 out of scale of 4 which shows that Polaris has a good response towards opportunities and threats.

Opportunities

Asian Industry growth
Steadily growing ATV and ORV in Europe
Distribution present in Europe
Increasing number of rider
US industry growth

Threat

Competition
Declining growth in Europe
Availability of substitute
Labor cost

Competitive

Polaris Industries Inc. deals in wide variety of products internationally. Its products includes off-road vehicles, motorcycles, snowmobiles and small vehicles being marketed in the United States, Canada and other markets present worldwide that are highly competitive and comprises of market leaders. There are number of factors on which the competition is totally based such as the sales and marketing programs like financing and advertising. The competition is mostly felt at the dealer’s levels and the company gets the competitive advantage which has good relations with its dealers. The competition is based upon numerous factors such as durability, price, features of the product and warranties. Most of the competitors in the market have diversified and strong financial and marketing resources and somehow that’s greater than Polaris. Polaris believes that the products offered by the company are competitively priced and sales and marketing programs for the dealers gives it a competitive advantage in the market.The major competitors of Polaris Industries Inc. include Yamaha, Honda, Harley Davidson, Arctic Cat and Ski-Doo.

Industry

The major products of Polaris Industries Inc. include off-Road Vehicles, ORV, ATVs and RANGER and RZR side-by-side vehicles. ATVs are the four wheel vehicles used for travelling on the rough paths and swamps. Side-by-Side vehicles can carry up to six passengers and the cargo can also be added. ORVs have multiple uses and they can be used in fishing, hunting and for trail and military purposes. ATVs were initially introduced by Honda, then by Yamaha and Suzuki. The attractive market for ATVs is the Western European Market where it is sold primarily being manufactured by similar manufacturers in North America. Due to the recent decline in the sales of ATVs in Western Europe, 2% decreased was observed in the year 2013 as compared to the year 2013.

It is estimated that there was an increase in the 2013 sales, approximately 10% during 2013 as compared to 2012. The Side-by-Side is gaining momentum as continued innovation and modernization is experienced by existing and new manufacturers. The main competitors of Polaris for Ranger and RZR side-by-side are Kawasaki, Yamaha and Arctic Cat. The division of motorcycles of Polaris consists of Victory and Indian motorcycles. Industry is comprised of four segments such as; touring, cruisers, sport bikes and standard motorcycles. The heavyweight motorcycles are suitable for transportation and recreational purposes. There are a number of snowmobile manufacturers in the industry serving North America and other countries like Europe. These manufacturers include Yamaha, Ski-Doo, Arctic Cat and Polaris. In the year 2013, industry unit sales of snowmobiles were estimated to be 136,000, globally.

Economic

The companies have to face decline in sales and other major issues due to economic crisis as it impacts the spending of the customers. The overall operations of Polaris are sensitive to the economic conditions, mostly in North America and Europe. As the economic conditions affects the total income and spending of the consumers. The weak economic conditions affect the consumer income. For instance, the employment levels of the consumers, increase in tax rates, saving, interest rates, and fuel and energy costs. Moreover, it also affects the spending on the products like cars and motorcycles or the sports vehicles as they are costly. Hence, the general effect of economic condition on consumers spending adversely affects the sales growth and profitability of Polaris. The economic conditions also adversely affect the relationship of Polaris with its distributors and dealers as the weak demand and quality of the product will motivate the dealers to take rational decisions. The instability in the economic conditions results in deterioration of Retail credit and acts as an obstacle for the ability of customers to finance the purchase of the product and adversely affects the financial services of Polaris. Furthermore, Polaris Industries significantly depends on its suppliers, primarily the suppliers are sensitive to economic conditions that could affect their business with Polaris and adversely affects the relations of suppliers with Polaris..................................

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