Current Market Position
Proven to be an effective job in their promotions, the gross profit margins of the company continue to rise. This would be a very good sign for the stakeholders since this would affect directly. The rise in their margins may be indicative of a significant rise in the demand of the motorcycles that they produce. Increase in the demand would entail the company to increase their supply, therefore, increasing their profit margins again. The company has effective promotional strategies, besides the fact that they have established themselves well in the market of motorcycles.
The increase in the operating margins can be explained by the increase in the gross profit margin of Harley-David...
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...son. This combined with the increase in the collection may be the key on the sudden surge of the operating profit margins. As we have explained earlier, the low values of the operating profit margins is because of the low collections in the financing services that they offer. Now that the collection of the financing branch proved to be on the rise then the rise in the operating profit was due to rise as well.
The last four parts of the data are related to each other. The return on assets have fallen, maybe because the company failed to realize that they have resources to harness; with this setback, they have chosen to issue financial instruments to be used in their projects. Although their projects proved to be a success, as seen in their return, the issuance of the financial instruments greatly affected the debt-asset ratio and the debt-equity ratio. These two means that the company is getting a bit risky to invest it.
The last result does not spell a success for the company. The overall assessment for the year of 2003 was that the company has learned from its mistakes as seen in the data of the debt-equity and debt-asset ratio. In achieving this, they also did not forget to turn their focus in the profit margins that they have focused on from the start. The only thing that mattered now is that the company of Harley-Davidson now learned from the past mistakes and capitalized in its learning process to achieve the desired output of the company.
Having capitalized on these mistakes, the company surged to the top in the year of 2003. This eventful year paced the company in resource management and its debt-ratio management. The important thing learned is that the resources should be utilized to achieve the resources that you have, and not just resort to your reputation as one of the best companies, to gather the necessary funds in order to jumpstart a project.
The growth rate in net revenue for the US was a surprise considering their near fall out in the motorcycle industry during the 1990’s. The present situation of the motorcycle industry indicates a bright future as 2. 5% of Americans own a motorcycle. (Cherng) The 11. 1% of Japan is a steady rate since they are the leading producer of motorcycles that include Yamaha and Kawasaki. The position of Harley-Davidson in the present market of the US is that they are the leader in the production of motorcycles in the US.
They also maintain these positions through the key marketing aspects of tie-ups, production of complimentary goods such as accessories and the presence of the community of Harley-Davidson owners. In the international field, Harley-Davidson is among the leaders of the Market behind leader Yamaha, but makes good strategic tie-ups like the pact made with Zongshen to maintain their market shares in the continent of Asia.
They also hold a good deal of market shares in the European region, competing with the likes of BMW from Germany and Suzuki from Japan. (“Harley-Davidson Rides into Europe”) The lesson learned by Harley-Davidson is just the basic lesson among the big corporations out there that fails to capitalize on their resources. It also tells the tale of a company that should learn to make the necessary adjustments to achieve its mission and vision on the industry.
Harley-Davidson has been known to pace the industry in developments in the motorcycle industry but somehow lacked the financial thoughts of a real corporation. The management of Harley Davidson is on the verge of claiming the top of, not only the motorcycle industry, but the transportation industry itself. Its promotional strategies that proved to be of great methods are still dominating the marketing strategies of others. This, combined with the right financial strategies, proved to be one of the formidable combinations in the business world.