Wilson Brothers Case Scenario Flashcards
What does the Wilson Brothers Limited company do?
This Canadian company manufactures and distributes various lines of prepared food products for the Canadian market from a number of plants
In the first year of operations the sales volume for Wilson Brothers Limited was what?
$300,000
By 2000 Wilson Brothers Limited had how many plants in Canada and what market did they expand to?
> had 6 operating plants in Canada.
> They had also expanded to the western US market and had a number of plants in Europe.
In 2000 the total sales volume of the Company was what?
> over 6 billion
There were a number of reasons for the Company’s exponential growth - what were
1) hardwork - each worked ten to twelve hours per day and so did senior/middle management
2) each brother was a skilled salesman in the traditional sense, handshake = contract
3) they had tremendous ‘cultural sensitivity’. Whenever they expanded to foreign markets they recruited a local executive to be CEO at that location so that the local culture was respected and integrated to business practices (fostered)
4) They assigned a Canadian executive to be VP Finance so that financial reporting was consistent across all Company operations.
Setting them apart from their competitors was?
(who made the decisions then?)
> the speed with which strategic decisions were made and the flexibility by which these strategies could be implemented.
> Strategic decisions were made only by the brothers.
What are the threats to the buisness?
1) General Canadian Economic Conditions
2) Competition
3) Pricing
4) Consumer Preference
5) Transportation
6) Recruitment
7) Unionization (non-union)
The current situation:
> You are brought in to the organization as Director of Human Resources for the Canadian operations. The Company has manager-level HR representation in each plant in Canada, but no one coordinates the overall effort. Your job, as described, is to develop and implement HR policies so that the company can apply them consistently throughout the Canadian organization.
> Subsequently, you will introduce policy to international operations, ensuring that where currently the company has non-union status, it is maintained.
> In that capacity, you report to Ron Abrams, Vice President of Operations, Canada. You work from the corporate offices in Brandon.
How are the General Canadian Economic Conditions a threat to the business?
> major deterioration in its manufacturing base which in turn has increased unemployment and depressed real wages
> inflation hasn’t been a huge factor in the equation, it has risen at a level greater than general wage increases.
> overall family budget devoted to food acquisition, the average family spends less now than it did five years ago.
> The trend to shopping at big box wholesale or discount stores such as Costco and Walmart, or the popularity of generic brands at Sobeys or Food Basics, impact the profitability of brand name products competing for the same market.
How is competition a threat?
> Significant competition exists in Canada from major companies with similar product lines. (American Firms are attempting to decrease Wilson Brothers Limited market share)
> Competition has also stiffened overseas, particularly in Europe. Early on Wilson Bros was often first to market with their products in many European countries, but as the market matured, local companies saw the success of prepared foods, gauged the opportunity and began to compete directly with Wilson products.
How is pricing a threat?
> The Canadian market for food producers is split into two avenues: retail sales, selling the product through major grocery chain stores such as Sobeys; and food service sales, such as McDonald’s or Swiss Chalet.
> On the retail side, major grocery chains have developed their own “housebrands” to compete on price against Wilson Brothers products in many of their food lines.
> On the food service side, Wilson Brothers is only able to maintain the business primarily on “best price” so that over time, regardless of volume increases, profit margins tend to decrease.
How is consumer preference a threat?
> consumers are being more discerning about purchasing convenience foods, paying close attention to such health concerns as transfats, unsaturated fats, salt, and sugars.
> Wilson Brothers desserts in particular have suffered.
> In Quebec the market has always been softer than other markets in Canada, and continues to deteriorate because of the preference for ‘home cooking’.
How is transportation a threat?
> Able Distribution Limited, (the wholly owned subsidiary of Wilson Brothers Limited) transports raw product to its plants for manufacture and inventory to its customers to market. However, the global cost increases in petroleum products have been significant and with the need to keep product prices low, transportation cost is a major area of concern for the Company.
How is recruitment a threat?
> significant issues recruiting in the Vancouver market in recent years since the cost of living in that market far exceeds real income.
How is unionization a threat?
> Labour agreements can add a level of structure and time consuming protocol that creates a less flexible operational environment. (not what the brothers prefer to do)
