Essay About Traditional Outlets And New Entrant

Calyn and Corola
Table of Contents
PROBLEM STATEMENT 1
ISSUES 2
1. CONSUMER AND DEMAND ANALYSIS 2
2. COMPETITOR ANALYSIS 3
3. SWOT ANALYSIS 5
ALTERNATIVES 5
1. ECONOMIC EVALUATION 5
2. QUALITATIVE EVALUATION 6
3. MARKET IMPLICATION 7
RECOMMENDATIONS 9
PLAN OF ACTION 10
PROBLEM STATEMENT
It was in the early 90’s that Owades and her associates assessed the options to grow their business. Although
the company had tremendously grown (revenue went from about $750,000 in 1988-1989 to about $10 million in
1990-1991). Calyx & Corolla was a new entrant into the $8 billion flower industry in the United States in 1991.
Still a start-up firm, it could enjoy the advantages of a small business model and also face the risks of being
crushed by a much bigger competitor.
Questions arising were: Was Calyx & Corolla more a mail order operation or should it compete directly against
more traditional outlets, such as retail florists, and wire services, such as Florists Telegraph Delivery (FTD)? How
fast did it have to grow to protect its initial success? What would be the financial implications of various growth
strategies?
In short, facing the fact that one of its biggest competitor, 800-FLOWERS, was aggressively expanding their
business into the brand new online business platform, Owades and her associates were facing a big question of
which path of growth they wanted in their plan of expansion
(1) The traditional path: the same competitors, the same business environments, partially proven that they
could succeed to compete and win customers
(2) OR the Internet path: new competitors, new business model, tremendous opportunities, much larger
customer pool, but unproven