RISK MANAGEMENT: TRIUMPH MOTOCYCLES LTD
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It began production of motorcycles in 1902 and was bought by John Bloor in 1984.Currently it has about 1600 employees. Its network of dealers consists of about 700 dealers in the globe. The source of company’s revenue is as follows: about 25 % of the revenue is obtained from North America, UK offers 15%, and continental Europe provides 22% and 22% is from Asia. There is lot of space for expansion especially in the United States where their market share is at 1% only ( unbelievably in 1969 it was the highest selling motorcycle brand in the US, making appearances in film with celebrities such as Clint Eastwood, James Dean, Marlon Brando and Steve McQueen until competition brought it down).
Triumph is a private limited company and therefore has its share of tribulations associated with such companies. Triumph faces several risks in its bid to be a leading motorcycle manufacturer and seller in the in the world with a big market share. The various risks facing the company which are foreseeable in the future include but not limited to the following:
1. Tight and Fierce Competition
Triumph Motorcycles Ltd has previously faced tough competition in this dynamic industry. In the 1970s period Triumph faced fierce competition from Japan which it was ill-prepared for. Generally, it suffered from many problems which included: high costs of borrowing, inability to come up with new and better goods fast enough which resulted to bad performance and outdated styling, non-replacement of old factory machinery contributing to low quality level in comparison with the competitors. It is evident that the competition has not come to an end with presence of Japanese giants such as Yamaha, Suzuki, Honda and Kawasaki which are large and efficient dominating the market.
In the US the likes of Harley Davidson has taken almost all the market leaving almost no space for Triumph. Triumph is very much aware of the challenges that the future present as shown by its former CEO, Mantoni, who once said that they were success then but Japanese makers were present always and the Chinese were coming. He also said that China had 25 to 50 brands then (year 2009) and in 10 years time, 2 or 3 brands will be as prosperous and competitive as the Japanese so they have to watch that always (Andrews R.N.L., et el. 2001). Japanese have been very competitive especially when it comes to the lower selling prices of their motorcycles. This means that Triumph has to be very vigilant of the upcoming competitors but not to forget the already existing ones.
2. Innovation and Changes in Technology
Triumph recognizes that it lacks the power to challenge the big Japanese manufacturers when it comes to innovation but it is determined to improve its current technology. Innovation has cost Triumph billions of money in its pursuit of competing with the Japanese who have made very innovative and great motorcycles in the past century. John Bloor and his team of engineers had to go to Japan to study the...