Ducati, founded in 1926, was originally a producer of radio and electrical
components. It was not until the post-war era that Ducati began production of its freshman
motorcycle. Ducati enjoyed comfortable levels of growth in its early stages. However, in the mid(prenominal)
1990s Ducati found itself on the brink of bankruptcy. At this caput Ducati decided to bring in
new CEO Federico Minoli, a former CEO at Benetton with a proven go after record. Under
Minolis guidance Ducati shifted its strategy and as a result was able to avoid bankruptcy. Using
the Porter 5 Forces manakin we will examine the sport bike exertion structure to understand
how Ducati was able to prosper within the comparable industry as giants Honda, BMW, etc.
We begin the Porter 5 Forces digest by examining the level of power Ducatis suppliers
have. Because the manufacturing of sport bikes was slightly standardized(bikes consist of an
engine, frame, fairing, and front forks) and there were many producers of individual motorcycle
parts this left suppliers with little power in equipment casualty of price negotiate.
The standardization of bike
manufacturing also meant that Ducati would be able to switch suppliers without experiencing
any significant costs(real or opportunity) on its fiction line. Ducati was also able to switch
between suppliers without experiencing significant exchange costs due to the companys
geographical law of proximity to the Emillian District, a densely populated area of mechanical
manufacturers in Bologna. Therefore, we conclude that the suppliers for Ducatis sport bikes
have low bargaining power.
The next Force within Porters framework we will examine is the bargaining power of
Ducatis consumers(buyers). vary of Minolis new strategy was to take greater pull wires over its
distribution channels. This resulted in shifting from the use of...If you require to get a full essay, order it on our website: Orderessay
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