Flip Factory Inc. Case Study: Analysis of Competitive Strategy

This case study solution analyzes Flip Factory Inc., focusing on its competitive strategy, financial performance, and strategic positioning. It includes a SWOT analysis identifying the company's strengths, weaknesses, opportunities, and threats, as well as a VIRO analysis assessing its resources. The analysis explores external factors affecting Flip Factory's position, such as legal, environmental, economic, social, and technological influences, using Porter's Five Forces and PESTEL frameworks. The solution concludes with recommendations and strategies for Flip Factory, emphasizing leveraging strengths, capitalizing on opportunities, and utilizing tools like the BCG matrix and marketing mix for sustained market stability. This document is available on Desklib, where students can find a wide range of solved assignments and past papers.

Running Head: FLIP FACTORY 0
flip factory inc.
CASE STUDY OF FLIP FACRTORY INC
SWOT and VIRO ANALYSIS
System04122
2/20/2019

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Answer 1:
Competitive strategy of flip factory that make it better than its competitors are that
 it uses new and innovative products
 it has experienced coaches, who are trained internationally
 it uses modern techniques unlike its competitors who use traditional techniques
 it has a transparent and open culture
Flip Factory used specialization as one of its business strategy. it was a part of this industry for
many years, Traviss understood that there is an opportunity in recreational gymnastics, after
studying the market, she understood that all the other gymnastics firms focused more on the
competitive gymnastic which also had overcrowded trainers and she also noticed that people
were not interested in competitive gymnastics. Therefore flip factory came into the market, to
fill up the space and provide the customers with recreational gymnastics at a professional level
and with good facilities. This made the company different from other clubs and the company was
able to attract more customers. The company was able to target youth, teens, and adult programs,
pre-school programs etc.
Flip factory made use of integration diversity by using different and unique techniques to attract
customers, flip factory made its marketing strategies by studying its environment, which in
return helped it to attract more customers. Like in the case of flip factory, it used recreational
way of gymnastics unlike the other clubs, which used the competitive way of gymnastics, and
this made it a unique and different club from other clubs.
Answer 2:
Financing is an issue for flip factory as Traviss always thought that in the end, her business will
raise funds but due to various reasons it did not happen, and thus she had to compromise on
the idea of expanding her business, which can give benefit to its competitors

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Answer 3: SWOT ANALYSIS OF FLIP FACTORY INC.
Strength  The company has Unique and innovative products
 It has a very Strong brand name and recognition in the market
 It has Passionate entrepreneurs and leader
 There are Experienced people in the industry
 The firm has Expert coaches who have international experience
 The firm has a Well-equipped facilities which attract more
customers (1)
 The firm has a very transparent and open culture
 The firm provide many new program offerings
 The Talent management is great in the organization
 It has a First mover advantage(2)
 Wide geographic presence
 First mover advantage
 Success of newly launched products
Weakness  The company has High expenses due to salary of the employees
 The company has Insufficient income/fund for its expansion
 There is High turnover of employees in the company
 The Loyalty among suppliers is very low as there is not trust between
the company and its supplier
 High cost in replacement of the existing experts in the organization
 The customer network that is promoted by the company is very less
effective (3)
 Low investment
 Extra investment needed for supply chain and logistics work
Opportunitie
s  Opportunities in online space, as there is increase in the number of
people using online services , this will help the company to give new
product offerings and can grow its marketing strategy

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 New technology and innovations will help the company to increase
the productivity and will allow the suppliers to manufacture varieties
of products and services (4)
 Increase in government regulations can help the company
 Preferences of customers are changing due to increase in incomes and
a very fast adoption of the technological products, the customers are
Threats  Distrust of institution and increase in threats of legal actions for
gymnastics flip(5)
 Growth in the technological expertise of the local players in the
market: one of the biggest threats is losing IPR,
 Trade relation of us and china can affect the growth plans of the
company
 Shortage of human resources
 Saturation in urban segments of the market and inactivity In the rural
segments of the market (6)
VIRO ANALYSIS OF FLIP FACTORY INC
RESOURCES VALUE RARE IMITATION ORGANIZATION COMPETITIVE
ANALYSIS
Positioning
between the
retailers and
wholesalers
Yes Yes No Yes Yes
Opportunities
in the E-
Commerce
Yes No , difficult No Yes

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and the use of
Present IT
Capabilities
Digital strategy
implementatio
n
Yes No Yes Yes No
Price strategies Yes No Yes Yes Temporary
Access to Raw
Material
Yes Yes No Yes Yes
Access to the
Cheap Capital
Yes No No No No
Gymnastics
Flip Corporate
Strategy
Yes No Yes Yes No
Marketing
Expertise
within the
Gymnastics
Flip
Yes No Yes Yes Temporary
Customer
Community
Yes Yes No Yes Yes
Global and
Local Presence
Yes Yes Yes Yes Yes
Answer 4:
External factors, which can affect the positioning of the flip factory, are:
 Legal
 Environmental
 Economic
 Social

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 Technological
Porter’s five force analysis
 Threat of new entrants
New entrants bring new ways and innovations, which put pressure on flip factory
to low there pricing strategy, and force them to provide the customers with new
product offerings. Flip factory needs to manage all these challenges and maintain
its competitive edge in the market.
 Bargaining power of suppliers
All the companies in the gymnastic flip industry buy their raw material from
various suppliers. In such cases, the suppliers are at a dominant position and they
have a power to decrease flip factory margins and earn lot in the market, the
powerful suppliers make use of their negotiating power to attain higher prices
from the firms and this affects the firm’s profitability.
Bargaining power of buyers
 Buyers are always often demanding and they look for better offerings with fewer
prices, this puts a lot of pressure on flip factory and affects its profitability in the
end
 Threats of substitutes
When a product or a service have the same features and fulfills the customers
need, the profitability of the firm suffers and hence it is important for flip factory
to offer new and unique services.
 Rivalry among existing players
In some cases if the rivalry among the customers is high, then the firm has to
reduce the prices and decrease its overall profitability in order to stay in the
market. Flip factory works in a very competitive way in the market.
PESTEL analysis of flip factory

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 Political: these factors play a major role in stating the factors that can have impact
on the flip factory’s long-term profitability in the market to enter various markets
flip factory has to study the following factors such as taxation, pricing regulations,
employee’s benefits, and wage legislation and so on.
 Economic factors: there are certain macro- economic factors that can affect the
growth of the company which are inflation rate, interest rate, foreign exchange
etc. Apart from this, the micro economic factors like competition norms can
affect the competitive advantage of the firm, it is important for a company to
analyze all these things in order to stay in the market.
 Social factors: the culture of the society plays an important role in the
organization culture as well. The attitudes and believes of the people play a
significant role in the market. In order to stay in the market it is important for flip
factory to understand the customers and the design the organization in the market
accordingly.
 Technological factors: technological factors are something that impact any
industry at a very fast speed, flop factory should analyses the new technologies in
the market and should be able to cope with them. Flip factory should focus on the
following things to stay in the market: it should study the new technologies,
which are being used by its competitors, technology impact on the product
offerings etc.
 Environmental factors: different countries have different norms for the
environmental standards, often every country or even states have a different
environmental rules and regulations, in order to enter the new market or to stay in
the existing market there are few things that flip factory has to consider which
are: climate, weather, waste management, environmental pollution and etc.
 Legal factors: in order to enter the market flip factory should consider the
following legal factors such as discrimination law, intellectual property law,
employment law, data protection law, health and safety law etc.
Answer 5:

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Recommendations and strategies for flip factory
 flip factory should focus on its strength and should make the most out of it, it
should also focus on various opportunities which are identified in the SWOT
analysis
 it should focus more on value creating activities
 flip factory should use the BCG matrix to analysis where should the firm invest
 it should use the marketing mix tools to stay stable in the market

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References
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