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Team Erie – CapSim Strategic Plan
Erin Heeren, Yi Yun Lau, Adam Sander, Jason Morgan
Niche Differentiation
Throughout the course of the simulation, Team Erie will be using the Niche Differentiation
strategy to focus our efforts on the three high technology segments. We believe that quality,
innovative products are the key to successful operations and a profitable endeavor. Team Erie
will place great emphasis on the high end, performance and size segments of the market and will
invest heavily in R&D to make sure our products are outpacing competitors in terms of size and
performance. Our desired position on the perceptual map places us on target with customer
expectations for the traditional segment, while slightly exceeding expectations in high end,
performance and size segments. Erie will strive to remain at the desired product age for each of
our product lines as well. We are inspired by the success of well-known companies who
continually offer the latest and greatest products, and we will structure our business model in a
similar fashion.
Erie’s products will outperform the competition; consequently we will price our lines at
the higher end of the desired range. We will heavily invest in promotion and sales for the three
technology segments, ensuring that our brand is at the forefront of customers’ minds. Our long
term goal is to phase out the low end product line and maintain the traditional segment, while
focusing the majority of our resources into the high technology segments. We do plan gradually
exit the low end segment, understanding we may need the low end products to generate the
startup capital necessary to effectively invest in R&D. The traditional segment will remain in our
product line in order to marginally diversify our clientele. Our forecasting will be modeled after
the qualitative analysis, using best case for our production schedule. Erie’s production will be
estimated being mindful of our first shift capacity and operating within its capabilities whenever
possible. If necessary we will invest in additional capacity to keep up with product demands.
In the short term, Erie will focus on maintaining a modest cash balance which will
position the company to invest in R&D and promotion and sales. In order to finance the cash
necessary to do so, we will issue stock and accrue long term debt. Our long term financial plan
will focus on paying down long term debt and issuing dividends to stockholders when
appropriate.
An example of a company that uses the Niche Differentiation strategy is Audi. Audi is an
automobile manufacturing company where headquartered in Germany. “Audi is part of the
“German Big 3” luxury automakers, along with BMW and Mercedes-Benz, which are the three
