TUTORIAL Jet Company has analysed its brand portfolio of 4 different brands (A t

Question

TUTORIAL Jet Company has analysed its brand portfolio of 4 different brands (A to D) by using Boston Consulting Group (BCG) Matrix method. The results of the analysis are listed in the table below. Evaluate the results of each brand and suggest possible strategies for the management's decision making to improve the company's bottom line and future growth. Brands Revenues %of Market Business forecast for the Jct corporate Company growth revenues | Relative | rate (%) market share next 5 years Market growth rate is expected to increase to 12% $530,000 | 54% 3% in the next two years Market growth rate is likely I to decline by 3% within the next 3 years due to increase in oil prices. $340,000 | 35% 0.5 12% Market growth rate is forecasted to decline to 8% | in the next three years. $55,000 | 9% 1.5 13% 990 Market growth rate is forecasted to decline to 9% o in the next there years 0.2 $25,000 | 2%

Explanation / Answer

Boston Consulting Group (Bcg Matrix)

It is the simplest way to potray a corporations Portfolio of investments.

Growth share matrix is also known for its cow and dog metaphors , popularly used for resource allocation in a diversified company.

Using the BCG approach a company claissifies its different business on a two dimensional growth share matrix.

We would see the relative market share and growth Rate for our analysis

Brand C Should hold its investments

Brand D Is Build to increase its market share

Brand B Should use this to create short term cash flows . advertisements to increase growth

Brand A should withdraw from the market because of low growth rates and market shares

Relative Market share High Low High Stars-
(hold)-C Question
Marks
(build)- D Market
Growth
Rate Low Cash Cows
(Harvest)-B Dogs
(Divest)- A

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