Dansko, Inc. Essay

Words: 1846
Pages: 8

Beginning in 1990, the “Danish Clog” was brought to life in the United States. It began as a small company selling the shoes at horse shows but quickly grew larger than was imagined. Expansion of the product went from a single closed back clog to over 3000 products being sold in over 3,500 retail locations. During the past fifteen years there have been many offers to sell interest in the company. You are now becoming concerned that the company that was such as success all of these years may not be structured appropriately to promote further growth. You are now faced with a decision on how to can move forward. Should you consider a merger that will allow growth and a more conventional way of operations?
Financial Analysis
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The one disadvantage that Dansko has is that they have used only one manufacturer for so long. You need to start searching for a much larger manufacture that can produce high quality products at the lowest price possible so they can always deliver the product in a timely fashion. Only having one manufacturer may pose a threat to the company.
Industry Analysis
Due to lack of financial reports available, to conduct an Industry Analysis I used Porters Five Forces Analysis. This has helped to determine the competitive power that Dansko possesses. The biggest weakness is found in Supplier Power. The supplier utilized by Dansko is very limited. This gives them great control over the company and could allow them to drive up prices. Dansko does however have a well established relationship without any substantial problems. To decrease the risk of the supplier power I would suggest that Dansko look for more manufacturers to be able to maintain a large volume so there will be no wait on supply. Buyer Power is pretty weak. This is because Dansko is only sold in smaller retail locations so there is not much of a chance that buyers can drive down prices. Also there are many small buyers of the product so if there was a loss of a couple of consumers it would not significantly affect Dansko. Each customer buys the shoes because they love