SDI was founded by Bo Haeberle, Glen Thomas and Ed Welsh in October 1998. The company manufactures and market a high-end, squirrel resistant bird feeder call Solar Feeder. The solar feeder is a squirrel proof bird feeder that delivers a mild non-lethal shock to a squirrel without delivering a shock to a bird using the feeder.
The obvious problem facing SDI and its management they are not making money. As a result the cash is running out fast and they will run into serious problem if the problem is not resolved.
The booking of solar feeder was good, but the production could not deliver the product to customers on time. Delivery of products to customers was slow. In the past six months, delinquent orders were accumulating and SDI had been unable to fulfilled the increasing orders.
Some parts of the Solar Feeder were contracted out to other suppliers. SDI was only responsible to assemble the parts. But control on its sub-contractor was bad. A lot of the parts received from these suppliers had quality problems. The parts could not be easily assembled due to a lot of the parts were dimensionally out of tolerance. It took a long time to adjust these out of tolerance parts. This had slow down production greatly, causing a lot of down time and production reject. Production output was low, overhead cost (rental plus labor cost ) was fixed, the company could not produce the required quantity to break even overhead cost.
Analysis and Evaluation - SWOT Analysis SDI
1. Positioning and promoting the solar feeder as squirrel-proof, nice in appearance, and winner of "best new product" awards.
2. Very positive and enthusiastic management team.
1. Unable to keep fixed cost under control hence not making money.
„X The total expenses are out of control.
„X In 1998, the total expenses were 11,989, which is 105% of total revenue (18,001). In 1999, although revenue had grown 207%, however the total expenses had grown even fas...