1. What are the strengths and weaknesses of Guajilote?
Guajilote uses three operations using very simple technologies, which means they only need limited capital to maintain the equipment. They have committed and determined members and employees. Santos Munguia has been the leader since 1995 and was able to renegotiate a better price for the sale of the cooperative’s wood. Due to the law of supply and demand, the price for the mahogany will increase when the world supply decreases. They are an environmentally friendly cooperative that only harvests fallen mahogany trees. The lives of the members of Guajilote improved significantly for them and their family members.
Although the staff is committed and determined, they have no education or training and Munguia has no educated leadership. They have limited distribution channels and their current distributor may not be paying them enough right now. Also, they don’t have enough capital and even a lack of access to credit to ...view middle of the document...
They could trend towards environmentally conservative products since many consumers are leaning towards that.
There is a threat of deforestation through fire, illegal logging, and slash and burn activities. Fire not only kills adult and young mahogany trees, but they also destroy their seeds. Potential restrictions by CITIES which could possibily result in an outright ban similar to the worldwide ban on ivory trading. Forestry encroachment by peasant farmers is another threat. Guajilote’s relationship with their distributor isn’t that great and there have been conflicts. They don’t have enough capital, money and human capital.
3. What are the strategic factors facing Guajilote?
Guajilote is a lifestyle business; they aren’t really concerned with growing, they just want to stay stable. They could rebrand the product to make it environmentally friend where consumers would be more likely to pay a little extra for sustainable wood. They can set themselves apart by differentiating and be able to charge a higher price. There could be a joint venture opportunity by cutting out the middle man and charging a little less. They can look into other trees in the forest to sell other types of wood.
4. Does Guajilote have any core competencies? If yes, what are they?
Guajilote’s core competencies were their three operations using simple technologies at a low cost. First, they searched to find the fallen trees with their man power. Then they used a temporary hand-sawmill to disassemble the tree. And lastly, they would use mule and human power to transport the tree to the distributor.
5. Does Guajilote have a distinctive competency? If yes, what is it?
Their only distinctive competency is that Guajilote is the only venture in Honduras with the right to exploit naturally fallen mahogany trees.