1) Which of the following are true about Bergerac\'s competitors? (select all th
ID: 326131 • Letter: 1
Question
1) Which of the following are true about Bergerac's competitors? (select all that apply) A) Bergerac's OmniVue product was at a higher price point than the comparable system offered by Abaxis B) Bergerac was the market share leader in the veterinary diagnostics instruments market C) Idexx had the largest product line and the best-established distribution network and sales force D) Bergerac saw an opportunity for itself to capture market share in small- and medium-sized veterinary practices
2) Which of the following statements are true of Bergerac's cartridge sourcing and production processes? (select all that apply) A) It was difficult for cartridge suppliers to respond to unexpected spikes in demand B) Despite dependencies on petrochemical prices, plastics suppliers enjoyed a market with very high margins C) Bergerac sourced the plastic parts for its cartridges from only one supplier--GenieTech D) Bergerac had to carry more inventory than they would like
3) Which of the following statements are true of the build vs. buy decision? (select all that apply) A) Bergerac's business already accounted for more than 90% of GenieTech's revenue B) McCarthy's analysis assumed a ~8% annual growth in production demand in the years ahead C) McCarthy calculated more annual savings with the in-house option at current rates of production D) In the "build" option, the machinery Bergerac would use would be less efficient than what GenieTech uses
For the exclusive use ot Y. Sherhan, 2018. HARVARD|BUSINESS|SCHOOL BRIEF CASES 4381 DAVID A. GARVIN Bergerac Systems: The Challenge of Backward Integration Introduction In July 2010, lan Wyckoff, CBO of Bergerac Systems, scribbled a few notes about his latest meeting with a group of veterinarians. These were his customers, and they provided direct feedback on their latest experiences with Bergerac's diagnostic instruments for animal care. The feedback was always valuable, although on this visit it was not entirely positive. Wyckoff's mind as he returned to the proposal he had started buy" analysis for OmniVue cartridges conducted by his director of planning, Bob McCarthy. McCarthy recommended that Bergerac build a cartridge unit within its own plant rather than acquire GenieTech, one of the company's two current The customer feedback was fresh in reviewing that morning. It summarized the "make vs cartridge suppliers. The decision between in-house development and external acquisition was critically Bergerac was growing fast averaging 17% annually since 2007 but it remained a small player with limited resources in a very competitive market, and Wyckoff was determined to avoid a costly mistake. to make a decision quickly, as the supply of OmniVue cartridges had been inconsistent in recent recently been frustrated by a Wyckoff months. Indeed, the veterinary practice that temporary for potential customers stock-out at their distributor. To maintain Bergerac's growth trajectory, it was impera to have full confidence in the company's ability to deliver on its promises. the contract with the other cartridge supplier, Elsinore Plastics, would come up for renegotiation in August 2010-a mere three weeks away Market Overview: Evolution of Pet Diagnostics In 2010, veterinary spending in the United States was expected to be $13 billion, having grown 7% to 8% per year over the prior decade (see Exhibit 1 for data on US veterinary spending Several factors drove this growth. First, pet ownership had increased steadily since the late 1980s, rising 6 points to more than 62% of households. Nearly 73 million US households had one or more pets, and the average of primary datn, or an lustration ol efective or inefiiective sunagement This cs, though based on real eveets, i Econalined, and any penons or entities is concidental. There are ocasional rederences to actal companis in the narration Copyright 2011 Preident and Fellows of Harvand Cellege. To orde copies or request permibiom to eproduce materials, all 1-800-545-7685, write Harvard Business Publishing Boston MA (2363 or go to hapx//www.hlsp harvard edu. This publications may not be digitiaed, or ohenwise reprodaced posted, or tranied, without the peemibssion of Harvard Business School Thes doomentis auhorined for use only by Youset Sherthan in Service Operations Management (MGT 3121)taugh by Cory Labano, CUNY- Baruch Colege trom January 201 2018.
Explanation / Answer
1. Bergerac
C Idexx has the largest product line, and, the best-established distribution network, and, sales force
Bergerac keeps its market share limited, and, sold its product through a network of veterinary distribution
2. Two suppliers - Genie Tech, Elsinore Plastic; fragmented and competitive market with low margins
A) - False, competitive market
D) Bergerac had to carry more inventory to avoid breakdown
3. build vs. buy
50% of Genie tech's revenue
limited resources for production
c) more savings in-house with current rates of production
Annual savings will be $2673819
b) 8-10% annual increase in-house diagnostic market - true
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