Segmnents of Harley-Davidson Company - Essay Example

Industry Analysis
# 1
As an organization, Harley-Davidson comprises two business segments; financial services and motorcycles and related products. The financial services segment encompasses a group of companies transacting business under the name Harley-Davidson Financial Services, which provide both wholesale and retail financing, as well as insurance and insurance-related programs. The motorcycle and related products segment encompasses the following segments; Parts and Accessories, General Merchandise, Licensing, and Motorcycles.
# 2
The four principal heavyweight motorcycle producers, apart from Harley-Davidson, include Honda, Yamaha, Suzuki, and Kawasaki. Other significant competitors in this segment include Polaris, BMW, and Triumph. Honda is the world’s biggest motorcycle producer, followed by Yamaha, and Suzuki. In the U.S., Harley has the biggest market share.
Heavyweight Motorcycle Producer Approximate Worldwide Market Share Ranking
Honda 1st
Yamaha 2nd
Suzuki 3rd
Harley-Davidson 4th
Kawasaki 5th
BMW 6th
Polaris 7th
Triumph 8th
# 3
Strengths
One of the prominent strengths of Harley-Davidson is the power of its brand. Harley-Davidson attracts a strong following from its loyal customers worldwide due to its commitment to the delivery of a unique experience. The ability of Harley-Davidson to deliver unforgettable experiences is the biggest attraction to Harley-Davidson customers worldwide. The engagement offers a platform for other stakeholders to experience Harley-Davidson's lifestyle, environment, people, and products.
In addition, Harley-Davidson's strength also emanates from its strong after-sales service, which is exhibited by its “family” concept exhibited by Harley Owners Group (HOG). Harley-Davidson’s marketing efforts such as dealer promotions, customer events, and advertising have consolidated the company’s brand. The company’s “family concept” has been critical to the success of Harley-Davidson in building enviable relationships with stakeholders such as customers, suppliers, shareholders, employees, government, and society (David, 2011). This has led to the institution of value-added activities, empowerment of employees, and enhanced customer loyalty. As a result, Harley-Davidson products have maintained a strong brand presence, especially in the traditional market.
Harley-Davidson derives a lot of strength from its customized products that appeal to the customer’s specifications. In offering a range of customized bikes, the company is assured of aligning its products with the prevailing consumer needs and expectations. The continuity of a unique culture of letting customers share their adventure and experience with the company’s products has made Harley-Davidson an American icon. Harley-Davidson initiatives such as the building of a museum in Milwaukee in 2008 have pursued to build a unique experience that reinforces bonds between the company and the company.
Weaknesses
Harley-Davidson faces challenges in keeping in touch with an ever-growing advancement in the design of motorcycles. Although Harley-Davidson motorcycles embody an innovative design and high performance, keeping up with an ever-growing innovation by the competitors is challenging as the company has constantly invested in research and development (David, 2011). In addition, some of the prominent competitors of Harley-Davidson's strategic alliance between Suzuki and Kawasaki in the fields of product development, design, engineering, and manufacturing may have heightened competition.
Another weakness that befalls Harley-Davidson is competition from established heavyweight motorcycle dealers such as Honda, Suzuki, Kawasaki, and Yamaha. The heavyweight motorcycle market is highly competitive, especially from competitors based outside the United States. Most of Harley-Davidson's competitors are diversified in the automotive market and other fields. The diversification reinforces the competitors’ operations while Harley-Davidson remains exposed to aspects such as economic vulnerabilities.
In addition, Harley-Davison suggested retail pricing is relatively higher compared to some of its competitors such as some of Polaris products. Harley-Davidson's competitors have massive financial and marketing resources that far outweigh those of Harley-Davidson. In addition, the competitors have substantially larger revenue. Some of the competitors offer heavyweight motorcycles with traditional styling that compete directly with those of Harley-Davidson (David, 2011).
Harley-Davidson Financial Services offer Harley-Davidson a competitive edge since it extends the company portfolio. Nevertheless, Harley-Davidson’s financial services operations face stiff competition from various banks and insurance companies. The competitors in this sector frequently have access to extra sources of capital at enhanced competitive rates and terms.
# 4
Presently, Harley-Davidson’s competitors have production and sales volumes that are relatively low compared to those of Harley-Davidson. This offers Harley-Davidson a window to extend its market influence and consolidate its market share. In addition, Harley-Davidson’s competitors have a considerably low U.S. market share compared to Harley-Davidson. Harley-Davison should continue promoting the motorcycling lifestyle in the form of events, rallies, and HOG in order to consolidate its market share. In order to remain relevant to the market and keep up with ever-growing customer expectations and needs, Harley-Davidson should remain a prominent leader in creativity and design.
Harley-Davidson should enhance its revenue generation capacity and explore ways of diversifying its portfolio so as to compete effectively. This is informed by the fact that Harley has relatively low revenue compared to its competitors, which constrains its marketing and distribution endeavors. Moreover, Harley-Davidson is negatively affected by the ever-growing competition coupled with tough economic conditions, which have forced Harley-Davidson to cut jobs and close down some of its factories (David, 2011). For instance, in the 2009-2010 financial year, Harley-Davidson shed 300-400 hourly jobs, besides the 1,100 jobs that the company had planned to eliminate during the same period. Read More