Verified Document

Crown Cork & Seal Central Issues There Essay

Crown Cork & Seal Central Issues

There are a few key central issues at Crown Cork and Seal. The company is facing a leadership transition between the company's founder and his disciple. This could cause a considerable disruption in the power of the leadership at the organization. Another key issue facing the company is how to respond to shifting industry dynamics. A major change in the industry of late is that firms in the industry are moving towards vertical integration. Reynolds is a producer of metal and now a can manufacturer. Kiewit appears to be some form of vertical integration although Continental's can business might be for sale. Pechiney now owns American National, increasing that company's reach across the industry. These changing dynamics will affect the tone and style of competition in this otherwise mature industry. The industry is also growing, in particular the aluminum can industry, and this may result in further shifts to industry dynamics. It is important for Avery to set strategy for the firm for the coming decade.

Among the decisions that need to be made quickly, Crown must decide if it wants to bid for Continental's canning business. Mergers in the business are challenging, but the acquisition of Continental would give Crown the economies of scale it needs. American is unlikely to buy because of antitrust issues and its integration of National. European competitors may only be interested in the European operations, but acquiring the U.S. business would make them major competitors...

The industry is dominated by five firms, and each of these firms has experienced some structural change recently. Possible trends developing in the competitive environment include vertical integration and global consolidation. Crown has a 7% market share and with that is tied for the #3 spot, well behind the top two players. The industry is subject to high price sensitivity, as the cans are largely commoditized. There can be differences in the composition of cans, but any technological change is easy for the competitors to replicate. Switching costs appear to be low, and firms within the industry have addressed this issue by signing major customers to guaranteed volume deals at set prices in order to lure customers. Some major customers, like soda bottlers are using their substantial buying power to drive down prices for cans, and this is squeezing margins for firms in the metal container industry.
While demand overall from customers is increasing, there are some other factors that are challenging in the industry. Can makers typically locate close to their major customers to lower freight charges, which the can maker normally covers. At times, this necessity bumps up against the cost of can making equipment, which runs upwards for $40 million for a new installation.

An additional issue for Crown is…

Cite this Document:
Copy Bibliography Citation

Related Documents

Crown Cork & Seal Crown Cork and
Words: 1204 Length: 4 Document Type: Essay

Crown Cork & Seal Crown Cork and Seal What do you think of Connelly's industrial strategy, financial policy & performance? Connelly's strategy was ahead of its time. This is because he saw the changes that were occurring early and made adjustments to the business model of the firm. From the 1960s to the 1980s, this helped Crown Cork & Seal to adjust with demand from customers. His financial policy was designed to reduce

Lesson Plan Amp; Reflection I Didn't Know
Words: 857 Length: 3 Document Type: Essay

Lesson Plan Amp; Reflection I didn't know what state you are in so was unable to do state/district standards! Lesson Plan Age/Grade Range; Developmental Level(s): 7-8/2nd Grade; Below grade level Anticipated Lesson Duration: 45 Minutes Lesson Foundations Pre-assessment (including cognitive and noncognitive measures): All students are reading below grade level (5-7 months) as measured by standardized assessments and teacher observation Curricular Focus, Theme, or Subject Area: Reading: Fluency, word recognition, and comprehension State/District Standards: Learning Objectives: Students will develop

Branding New Service Dominant Logic
Words: 12522 Length: 50 Document Type: Dissertation

Branding in Service Markets Amp Aim And Objectives Themes for AMP Characteristics Composing Branding Concept Branding Evolution S-D Logic and Service Markets Branding Challenges in Service Markets Considerations for Effective Service Branding Categories and Themes Branding Theory Evolution S-D Logic and Service Markets Branding Challenges in Service Markets Considerations for Effective Service Branding Branding Concept Characteristics Characteristics Composing Branding Concept Sampling of Studies Reviewed Evolution of Branding Theory Evolution of Marketing Service-Brand-Relationship-Value Triangle Brand Identity, Position & Image Just as marketing increasingly influences most aspects of the consumer's lives, brands

Sealed Bids Vs. Competitive Proposals
Words: 651 Length: 2 Document Type: Term Paper

Sealed Bids vs. Competitive Proposals As part of their job description, contracting officers have to make a wide range of decisions relating to procurement. One of these decisions is whether to use competitive proposals or sealed bids. In this text, I compare and contrast competitive proposals and sealed bidding. In so doing, I will amongst other things discuss the most advantageous method from a contractor's perspective. Sealed Bids vs. Competitive Proposals Before discussing

Sealed Bids Vs. Competitive Proposal Chapter 6
Words: 631 Length: 2 Document Type: Essay

Sealed bids vs. Competitive proposal Chapter 6 of the Federal Acquisition Regulations states that contracting officers are only allowed to solicit sealed bids when time allows for solicitation, submission, and evaluation of the sealed bids (Justia Law, 2012). Contracting officers are under strict instruction to only make an award on the basis of the price. Besides, the law compels the contracting officers not to engage in any form of discussion with

Central Park New York and Mohawk Park
Words: 1282 Length: 4 Document Type: Capstone Project

Central Park (New York) and Mohawk Park (Tulsa, Oklahoma) Municipal parks have a long history, and the importance of these invaluable green and open spaces to the people who live around them cannot be overstated. Perhaps the best-known pubic park in the United States is New York City's Central Park that provides the city's citizenry with an enormous green space in the middle of a concrete jungle. Although lesser known,

Sign Up for Unlimited Study Help

Our semester plans gives you unlimited, unrestricted access to our entire library of resources —writing tools, guides, example essays, tutorials, class notes, and more.

Get Started Now