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1、1Crown Cork and SealAdam Francis, Greg Cullen, Angus Walker, Terje Fiskvik 7/3/031.What are the most significant factors affecting competition in the metal container industry?Consumer demand/PreferencesTechnological ChangeEnvironmental / Legislative RiskNumber of CompetitorsGeographic location of pl
2、ant and customerInfrastructure InvestmentResearch and Development2Crown Cork and SealAdam Francis, Greg Cullen, Angus Walker, Terje Fiskvik 7/3/032.Have these factors changed over time?Consumer demand/Preferences The consumer is more aware of needs and abilityTo manufacture to desired specification
3、(Packaging)Technological Change Tin manufacturing lines have reduced in cost,as manufactures lost clients which in turn lead to a reduced cost of approx 80%.Environmental / Legislative Risk Ozone hazards relating to fluorocarbons and theValue of recycling tin was less than aluminum.Number of Competi
4、tors Decreased considerably due to increased manufacturingand logistics, and the reduction of consumer demand.Geographic location of plant and Infrastructure Investment They increased thenumber of plants by 300%, reduced the size and based them close to customer ratherthan raw material.Research and
5、Development Crowns R&D focused on enhancing their existing product line.Their preference was to perfect their technology that they were using, and let others take the risks.3Crown Cork and SealAdam Francis, Greg Cullen, Angus Walker, Terje Fiskvik 7/3/033.What strategy does Crown Cork have for compe
6、ting in this industry?Not much Research and DevelopmentFocus on customers needsInvested in new plantsPlants set up for multiple customersLocated plants close to customerInternational Expansion Crown and Cork concentrated on international growth, especially in developing nations. (In many cases the c
7、ompany received 10-year tax shelters)4Crown Cork and SealAdam Francis, Greg Cullen, Angus Walker, Terje Fiskvik 7/3/034. What advantages, if any, does a firm the size of Crown Cork have over American Can and Continental Can?They dont have as many organisational obstacles and are able to react quicke
8、r to product innovationAs they would have lower overheads than the 2 majors they dont have to follow suit & diversify, they are able to specialise on tin products.Do not have a high Research and Development budget as they are not interested. They are able to let others take the risks and make mistak
9、es during R&D and learn from the innovators heartaches.5Crown Cork and SealAdam Francis, Greg Cullen, Angus Walker, Terje Fiskvik 7/3/035.How would you explain the comparisons shown in exhibit 3 in this case?Total Company PerformanceThe 2 majors both Continental Group and American Can had the highes
10、t Sales and Net Income for the period between 1967-76 but were overshadowed by Crown Cork and Seal for growth in Sales and Profit for the same period.Both National Can and Crown Cork and Seal had the highest ROE against the 2 giants of the industry and Crown Cork and Seal the lowest Debt Ratio.Metal
11、 Can Segments (domestic)Whilst Crown Cork and Seal had the lowest sales for this segment it had the largest as a % of sales percentage.Also interesting was the fact that Crown Cork and Seal had the lowest amount of can plants. The number of Crown Corks plants was approx 269% less then than largest C
12、ontinental Groups. (ie Reduced Assets therefore lower overheads) Whereas Crown Corks Net Income was only 161% less than Continental Groups.6Crown Cork and SealAdam Francis, Greg Cullen, Angus Walker, Terje Fiskvik 7/3/036.Identify and discuss the major problems facing Crown, Cork and Seal.The Ozone
13、Controversy Most tests supported the basic thesis that fluorocarbons were in some way damaging to the ozone layer.Regulating Nonreturnable Containers Legislative restrictions on the use of nonreturnable containers threatened Crown Cork. The EPA banned throwaways from federal property.Economic Impact
14、 Laws posed a threat as would increase beer and soft drink prices.Deposits and Recycling This new system favored aluminum cans because of the higher value reclaimed for aluminum and the recycling network already existed.7Crown Cork and SealAdam Francis, Greg Cullen, Angus Walker, Terje Fiskvik 7/3/0
15、37. What recommendations would you make to John Connelly as of the end of the case?Employ the assistance of external experts to identify and evaluate:Employ political lobbyists to combat possible legislation that reduces the use for products manufactured by Crown Environmental concerns with products
16、 Industry specific advice Review current technology Market penetration8Crown Cork and SealAdam Francis, Greg Cullen, Angus Walker, Terje Fiskvik 7/3/037. What recommendations would you make to John Connelly as of the end of the case? ContMarketing approach Additional and or synergistic markets Plant locations Efficiencies at plants (Just-in-Time manufacture?) Efficiencies for raw materials New types of raw mater
