SWOT analysis is Merrythought’s four core business areas including human resource, finance, operations, and marketing, by looking at the strengths, weaknesses, opportunities, and threats. These are indicated in the table below.


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Human Resource


Merrythought is an established and recognized name in the UK,

Established brand as quintessential English teddy bear,

Strong local market from departmental stores and independent retailers,

Niche market from ,

Half of their consumers are collectors who pay premium for teddy bears,

employee Workforce skilled in the manual and traditional teddy bear manufacturing methods,

Stabilization of fortunes in decades since the downturn in the 1990s,

Increase in revenue from annual improvements from strong exports and Olympic games


No product differential strategies as Merrythought only designs and produces teddy bears,

Company has focused on the British niche and up-market clientele,

It’s a product led company surviving on producing and designing,

Slow and poor production processes from Victorian style factory, old manual machines, and slow new recruits,

New recruits take two years to reach required standards,

Cost of Repairs to factory do not produce ROI,

High overheads from labor intensive production,

Expensive in house training,

Inexperienced and young new management, for an employee-based used to older-male managers,

Difficult to find skilled labors in the industry,


New markets from strong exports to Japan and demand for ,

Potential new market from visitors to the old factory,

Growing demand and new markets overseas,

Overhaul of marketing strategies and use of e-commerce methods like company website to reach a wider market

Web-based marketing cuts back on supply chain costs like distribution as they will sell directly to customers,

Modernization will increase production, lower production costs,

In house training to increase skill and speed of new recruits,

Sarah is a former public relations and recruitment consultant who brings to the business skills in customer, employee, and external environment relations, hiring, recruitment, and training skills.


Cheap bears from off-shore factories and foreign companies,

Competitors have modernized production operations

Slow economic recovery from economic downturn

Few if any skilled and experienced workforce in the market in bear making,

The table indicates the main areas Merrythought needs to strengthen to improve production, sales, and profit margin. The company needs to take advantage of the ready new markets like Japan, the high local demand for , the collectors online, and the high-end niche upper market. This also entails maximizing the company’s name and teddy bear’s brand name, and their web site to defend their market share and maintain the increase in revenues realized in the past year. These will provided higher sales and profits, which can be used to overcome weaknesses and challenges like in-house training, modernization of production, and overhaul of marketing strategies. The skills brought to the company by the two daughter’s and the strengths and opportunities will assist the company in reducing its overhead costs, train a fast workforce, and realize higher returns on investments.

b) Organizational culture

A factor influencing organizational culture is the masculinity/femininity concept from Hofstede theory (Zabid, Sambasivan, & Azmawani, 2004). The new manager will face challenges since the factory workforce was used to a male dominated older management system for many decades. Moreover, the UK society is highly masculine with higher masculine values depicting traditional masculine qualities. A second factor is the training of recruits on stuffing techniques to reach production speeds of experienced employees. In the organization, a new recruit is considered skilled if they can meet production levels similar to the experienced employees. Thirdly, the company and workforce practices and behavior are under the influence of the new vision for an overhaul of marketing strategies by the new leadership. This means as the new leadership tries to improve the business, the workforce is driven to operate on practices and behaviors that are visionary. Fourthly, the company is founded on a tradition and history of design and production that is labor intensive, and calls for skilled and hardworking employees. The culture of the company is founded on a tradition of values with their roots in traditional, , where employees stuff teddy bears by hand. Fifthly, the company is traditionally a manufacturer of teddy bears, which have been embraced by the British market as an icon. The teddy bear is accepted as a “The British Bear,” with consumers from high-end and premium buyers, as well as collectors. This is one of the measures of the business performance, for Merrythought evaluates it annual success on the number of bears and the amount of revenue. Overall, organizational behavior is directed by the value, of a traditional British company, a heritage of the community, and the quintessential English Teddy bear.

Question 4

a) Gathering Market information

To obtain accurate and adequate information of the existing and potential market segments, Merrythought needs to make use of internal records, marketing intelligence, and marketing research. I would recommend internal records since it would provide statistical analysis and a base for forecasting and projections. Internal records can map out the demographics of collectors, sales to Japan, and souvenir buyers from departmental and specialty stores. Internal records will reveal buying trends, preferences, and tastes, price range of the three market segments. This information forms the background for making statistical analysis and making projections for future market behavior. The second method entails marketing intelligence. For Merrythought, marketing intelligence is the feedback they receive from clients and sales team on the ground and online. This also includes information about the market from their employees, friends and colleagues of their father, newspapers, articles, and government or business agency reports. These on changing marking forces, consumer behavior, culture, preferences, and economic forces affecting the market. The third method, entails carrying out a market research to affirm the information obtained from the two methods. Market research entails identifying the three market groups, selecting a sample population, selecting the research instrument, and analyzing the data. For Merrythought, its target population is collections half of whom buy online, consumers of souvenirs, and the Japanese market. Given the geographic disbursement of the population, the company can post questionnaires and use an online survey. This research will be seeking information from the sample population on current tastes and preferences for toys and teddy bears and pricing range. They test the number of times they buy toys to determine frequency, and cultural events or factors that promote the sale of teddy bears in any given year.

b) To communicate with collectors, Merrythought needs to create first awareness using public relations. The company can gain useful tips on effective public relations from Sarah, who was a former public relations consultant. Public relations message on the company and the type of bears they make, will target media collectors often use like the internet and vintage fairs. Other potential sites to place the messages are through magazines, social media networks, and the teddy bear convention. After the collectors show interest by visiting the factory, contacting the company, or visiting the company website. The company can heighten this interest with advertisement messages of the old and new collections of teddy bears and their prices. These messages must take advantage of the social networks and online sources for most collectors shop through these media. Interest in collectors is accentuated with personal selling strategy. This is for those collectors that visit the factory, contact the company, or visit the company’s website. Personal selling will use messages with details of the company history, the manufacture method, and age of the teddy bears, and the quality assurance. Thirdly, involves the creation of a desire for the teddy bears through promotional strategies and focused advertisements (Kaur, & Sharma, 2009). A sales promotional strategy suitable for this market segment is product-based methods, where the company offers a discount price on the second purchase of a teddy bear. Focused advertisement involves competitive advertising, which distinguishes the Merrythought’s teddy bear from other teddy bears in the market. This also accompanies the selling of the company’s image as a leading and well-established manufacturer of novelty teddy bears that represent the image of Britain, to appeal to the novelty side of collectors. Advertisement message must focus on the company’s brand name, its year of establishment, famous teddy bears sold since its establishment, and the current teddy bear trending in the market. The goal of the advertising is to appeal to consumers that collect toys (Kaur, & Sharma, 2009). In this manner, the company through this focused advertisement will attract teddy bear collectors and other toy collectors to its teddy bears. This then leads to the action stage of the marketing communication strategy. In this stage, the company creates the advertisement, promotional, media messages, images, and slogans for each communication step. The company also prepares the packages teddy bears as novelty items for the collectors.

c) The first pressing human resource challenge is the influencing of current organizational behavior, especially in employees to accept Sarah and Hannah as leaders, managers, and embrace their visions. This is a challenge given the two are young, without experience in running and managing a manufacturing company. The second most pressing human resource management issue is the training of current new recruits to gain the production skills required of a Merrythought employee. Training is identified as the main human resource challenge since it is the only feasible method to increase the workforce and production given the lack of skilled teddy bear makers in the market. The main finance and accounting issue involves the use of funds to make repairs to a roof, which will not create any return on investment for the company. In addition, the new managers have to find financial resources to minimize the high overheads from labor-intensive production processes. The managers must maintain balanced financial statements despite the large costs from these two financial aspects.

Question 5

a) Globalization

Globalization is internationalization of most of the business processes or economic activities like production, communication, logistics, across national boundaries. Globalization entails the expansion of labor sources, establishment of a global brand, creation of a global consumer, development of per capital income in other nations, utilization of trading blocs and free trade across borders (Osland, 2003). Based on this description of globalization, it is the opinion that Merrythought is at the first phase of globalization. For the company, this is indicated in their presence of international foreign markets or consumer base in other nations, especially Japan. Secondly, the company is making use of online information technology media, in this case the internet, to reach consumers. The company is not fully globalized for it has maintained its major teddy bear market in Britain, and its factory and distribution channels are in Britain. Moreover, the company does not intend to outsource any production or manufacturing aspects to any region or country outside Britain. The company, does not seek to take advantage of the EU trading bloc, nor Britain’s common wealth relation with other nations to expand management, manufacturing, sale, or production outside the UK.

b) Drivers of Globalization

These pressures push business to adopt globalization as a business strategy. They are government drivers, competition, cost, and market drivers. Cost drivers are those factors that have the potential to lower the cost of product or service for a business. They involve factors like the search for economies of scale, growth, and development through technological processes and communication. In addition, they entail the search for lower labor costs and lower sources of resources, and faster and more efficient transportation means across bounders. In the Merrythought’s case, the driver for globalization would be the search for lower costs. For the company, they interest is the lowering of production costs in terms of factory space and cheaper labor. In addition, this entails the adoption of technology in production to reduce the overhead costs from labor-intensive practices or cost of maintaining factory premises. This also entails more efficient and cost effective communication and advertisement methods as seen with the use of the internet and web-based tools.

The second driver of globalization is market drivers like the establishment of a global brand recognized internationally. This also entails low-cost travel by creating global consumers. From these drivers, it is evident Merrythought choice of selling their teddy bears to the Japan market, where it has a strong and dominant foreign market takes advantage of the first point. In this approach, the company is expanding its market, increasing sales, and establishing its teddy bear brand internationally away from the British market. In addition, the company is driven by the desire to create global consumers for its teddy bear in Japan, by cutting back on transportation costs.

The third class of drivers is government drivers, which bring nations together to increase trading activities to create wealth and economic advantage. In this class, common drivers include reduction of trade barriers through trade tariffs for exports and imports. It also includes the use of trading blocs like the European Union trading bloc that brings together European nations. Liberalization of markets through open economies in nations and the encouragement of privatization drive businesses to globalization. In this case, there is no indication that Merrythought is taking advantage of any trading bloc, free trade agreements, and lower tariffs created by Britain with any nation. There is no indication that Merrythought has considered taking advantage of the EU trading bloc, apart from selling its teddy bears to the Japan market to increase its market share.

The last driver is competitive drivers. These involve the opening of the teddy bear production industry or the British economy to competitors from other nations. In this factor, companies are driven to globalize by taking advantage of the presence of cross-border ownership of businesses, takeovers, alliances, and acquisitions. This factor may drive Merrythought to globalize since there is a heavy presence of teddy bears in the UK market from foreign importers and companies. Secondly, the company is seeing the movement of toy producers abroad to reduce production cost by outsourcing services.

The main motivator for the company to globalize would be cost drivers. This is because it is facing a labor-intensive factory, which is run down, has low ROI and high maintenance overhead costs.


Kaur, G., & Sharma, R.D. (2009). Voyage of marketing thought from a barter system to a customer centric one. Marketing Intelligence & Planning, 27(5), 567-614.

Osland, J.S. (2003). Broadening the debate the pros and cons of globalization. Journal of Management Inquiry, 12(2), 137-137

Zabid, A.R., Sambasivan, M., & Azmawani, A.R. (2004). The influence of organizational culture on attitudes toward organizational change. Leadership & Organization Development Journal, 25(1), 161-179.