(a) Develop a SWOT analysis for Carvana. In doing so, identify and explain 3 strengths, 3 weaknesses, 3 opportunities and 3 threats that may affect the company. Use research to support your answer.
Develop a SWOT analysis for Carvana-In doing so, identify and explain 3 strengths
Key Learning Objectives (for all written activities):
1) Firstly, Apply knowledge learned in specific modules to actual business phenomenon.
2) Secondly, Develop/enhance business research and analysis skills.
3) Thirdly, Communicate marketing knowledge in a formal business style research report/insight.
For citations, please use APA style. Information on APA style can be found through various online sources. Please note that there may be various variations of the APA style so whichever one you use would be fine. However, please maintain consistency in whichever format you use. Here is an example. In-text Citations Transaction cost theory, originally proposed by Coase (1937) and then developed upon by Williamson (1975), examines the efficacy of performing a particular transaction internally versus externally (Geyskens, et al., 2006). In that regard, TCA evaluates the benefits and disadvantages of outsourcing Visa in-house development of a product (Ang and Straub, 1998; Bhali and Rivard, 2003; McNally and Griffin, 2004).
Bibliography Format McNally, R.C., and Griffin, A. (2004). Firm and individual choice drivers in make-or-buy decisions: a diminishing role for transaction cost economics? Journal of Supply Chain Management. 40(1), 4-17.
• Additionally, The research paper must have a minimum of 10 references in the bibliography section. The sources that are provided in this paper can be part of the 10 references.
• Page Length: 4-7 pages, single-spaced (including any charts; excluding cover page and bibliography). The paper must be at least 4 pages in length. While there is no penalty in terms of going over the 7-page limit, it is recommended that you stay as close to that number as is possible to minimize any repetition, etc.
• Students are not required to include charts/figures but if you do choose to use these, the charts must be embedded in the main body of the paper (in relevant sections) and not in an appendix. Chart/figure numbers and titles must be used. Please make sure that the chart/figure is legible. Please cite the source for the chart at the bottom.
This activity focuses on Carvana which utilizes an online platform to sell used vehicles.
3. Company Blog- https://www.carvana.com/research
4. Carvana – Investor Relations-https://investors.carvana.com/
5. Carvana – Company Video- https://investors.carvana.com/events-and-presentations
6. McKinsey – Used Car Market Article- https://www.mckinsey.com/industries/automotive-and-assembly/our-insights/used-cars-new-platforms-accelerating-sales-in-a-digitally-disrupted-market
7. Automotive News Article- https://www.autonews.com/used-cars/5-used-vehicle-trends-2020
In addition to the above URLs, you must conduct additional research to develop a deeper understanding of trends in the used/pre-owned vehicle market.
Q.1. (a) Develop a SWOT analysis for Carvana. In doing so, identify and explain 3 strengths, 3 weaknesses, 3 opportunities and 3 threats that may affect the company. Use research to support your answer. (25 points)
Hint: Opportunities are not the same as recommendations, i.e., Carvana should enter foreign markets. Rather an opportunity is a trend, e.g., growing demand for used vehicles in overseas markets. Similarly, threats are also external to the company and should not be confused with weaknesses. Opportunities and threats are tied to the macro environment such as social cultural shifts, economic outlook, competition, etc.
(b) Further, Are any of the company’s strengths sustainable over the next 12-24 months? Explain your answer. (10 points)
Answer Format: Use headings and sub-headings. For instance, the main heading could be Strengths and you can use a sub-heading for each strength followed by an explanation. Or the main heading can be Strengths and you can create a bullet-point list below that. However, each bullet-point must have sufficient details/explanation and it cannot be just a two or three word sentence.
Q.2. (a) Firstly, Identify and explain 5 criteria a consumer is likely to use when deciding which outlet to purchase a used vehicle from? Use research to support your answer. (25 points)
(b) Secondly, How does Carvana rank on each of these criteria? (Excellent, Good, Fair, Poor)? Explain your rationale. (10 points)
Answer Format: For part (a), list each criterion using a heading followed by an explanation of why that criteria are likely to be important to a used vehicle buyer.
For part (b), you can also develop a chart/matrix or use a different format. Furthermore, Briefly explain the rationale behind each ranking.
Q.3. (a) Firstly, which of the following strategy (ies) is the company employing currently? See Figure 1 below. Use research to support and explain your answer. (15 points)
(b) Secondly, Which strategy (ies) should be used going forward? Explain your answer. You can also, choose the strategy (ies) from Figure 1 or you can propose on of your own. In developing your recommendation, you can focus on short or long-term or both. (15 points)
Hint: For part (b), one way to come up with a strategy is to review the SWOT analysis to see if you can find something there that may be worth exploring. Another way would be to look at the customer purchase criteria which you identified.
FINALLY, Answer Format: Each part must be answered separately. Lastly, Use headings or subheadings followed by an explanation. Figure 1: Marketing Strategies