Husky
- Submitted by: tua31282
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- Category: Other
- Date Submitted: 12/06/2010 04:01 AM
- Pages: 6
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Executive Summary:
Husky Injection Molding is a company that makes machines which make plastic products. Their industry has grown at a 6% rate per year since 1982. With the rapid growth in the industry there are many competitors arising. After quadrupling revenues one year they knew they were going to suffer the next year because there were not enough raw materials for the capacity needed to satisfy the growing industry. Husky’s other problem was that they also had some of the highest cost and prices within the industry. With companies competing to purchase raw materials, I decided the best way to continue making a profit was to raise money by taking the company public. In doing this they will have additional money to pay for the ever increasing raw materials and they would also be able to put more money into research and development to figure out how to produce their products cheaper.
Introduction
Husky is a Canadian company which produces equipment to make plastic products ranging from soda bottles to automotive components. Established in 1953, by the early 1990s they enjoyed astronomical growth where their net income quadrupled. With the industry expanding, competitors decided to enter their most profitable markets. At the same time a shortage of the raw materials needed to produce plastic products lowered their products demand. As the new year approached, competitors fiercely competed for market share knowing they most likely will not reach their goals. In this memo I will analyze the internal and external environment and recommend a strategy for Husky to survive during this period of decreased demand.
Analysis and Research
Husky was specifically in the market of making plastic injection molding equipment and related services. They introduced their first injection molding machine in 1961 and were on the brink of bankruptcy in 1974 until forming an alliance with Owens-Illinois, a major container maker. During this time many soft drink makers were...
Husky Injection Molding is a company that makes machines which make plastic products. Their industry has grown at a 6% rate per year since 1982. With the rapid growth in the industry there are many competitors arising. After quadrupling revenues one year they knew they were going to suffer the next year because there were not enough raw materials for the capacity needed to satisfy the growing industry. Husky’s other problem was that they also had some of the highest cost and prices within the industry. With companies competing to purchase raw materials, I decided the best way to continue making a profit was to raise money by taking the company public. In doing this they will have additional money to pay for the ever increasing raw materials and they would also be able to put more money into research and development to figure out how to produce their products cheaper.
Introduction
Husky is a Canadian company which produces equipment to make plastic products ranging from soda bottles to automotive components. Established in 1953, by the early 1990s they enjoyed astronomical growth where their net income quadrupled. With the industry expanding, competitors decided to enter their most profitable markets. At the same time a shortage of the raw materials needed to produce plastic products lowered their products demand. As the new year approached, competitors fiercely competed for market share knowing they most likely will not reach their goals. In this memo I will analyze the internal and external environment and recommend a strategy for Husky to survive during this period of decreased demand.
Analysis and Research
Husky was specifically in the market of making plastic injection molding equipment and related services. They introduced their first injection molding machine in 1961 and were on the brink of bankruptcy in 1974 until forming an alliance with Owens-Illinois, a major container maker. During this time many soft drink makers were...