Optimeyes was a startup company in the ophthalmic retailing industry based in Ireland. The industry though lucrative was filled with bigger competitors, strict regulations and cyclical demand of products. It however had a lot of potential driven by the fact that glasses were becoming fashionable in the Irish market and technological innovations such as spectacle vending machines and automatic refractometer which enabled mechanical testing of eyesight. Though founded under these circumstances Optimeyes is able to achieve gradual growth.
SWOT analysis enables managers to gain organizational environment awareness and influence organizational performance by enabling the development of warning systems and strategies to avoid or minimize threats and overcome organizational weaknesses (Rousan & Qawasmeh 2009). Amongst the strengths of Optimeyes are excellent customer service, innovativeness, low prices, fully integrated operations and a strong brand name. In light of competition a strong brand name serves as a differentiating factor between competitor products while at the same time providing sustainable competitive advantage (Sandsmark 2011). Excellent customer service on the other hand drives growth through customer satisfaction resulting to a good organizational reputation, referrals and customer loyalty. Innovativeness is exhibited through adoption of automatic refractometers in the business model. Technology helps small organizations to achieve efficiency since they are able to do more using little time thus improving productivity and competitive advantage over competitors (Warner 2011). Use of automatic refractors enables Optimeyes to overcome legal barriers that required that in order to sell glasses one had to employ the services of a medical practitioner. Integration of operations whereby the company was involved in both upstream activities such as sales and downstream activities strengthened the company against competitors while at the same time enhancing cost effectiveness through tighter and better cost control and risk reduction (Cognizant, 2011). The company’s weaknesses are a small market share, lack of capital investment, limited promotion budget and little market information. Optimeyes being a small business had a small market share as compared to its larger competitors who had been in the business for some years. Though the company was in a capital intensive industry it was started using personal savings of IR£10000 and a bank loan of IR£25000 which was not enough to launch a major operation and ensure intensive advertising. Little information in the Irish market, especially on the market’s value and on consumption of ophthalmic products is also a weakness. Relevant information is a necessity in the business world since it serves as the basis of business decisions (Drucker n.d).
The opportunities presented to the company include adoption of spectacles as a fashion element, and thus demand is bound to go up, since individuals would want to move with trends. Increased repeat orders emanating from this sense of fashion and a gradually strengthened brand would also ensure growth. Small and medium towns also present investment opportunities for the company. The company however faces threats such as increased competition from bigger chains which are able to offer better discounts and stringent laws and regulations which make operations difficult. Competitor action influences the profitability, market share of competing firms, therefore firms have to analyze competitor actions and come up with strategies to counter those actions (David 2011).
The Irish market is segmented geographically into either small or medium cities or large cities such as Dublin. The number of females in the market is relatively high as compared to that of males. Youths and the working class, who are considered to be more fashion savvy hold a relatively high number and thus cannot be ignored as a potential opportunity from which to derive growth.
Due to constraints in resources, increased focus on fashion conscious consumers and market information that indicates high numbers of females, youth and the working class and high populations in the urban areas, Optimeyes should focus on young female and urban consumers and provide wide range of fashionable spectacles and also provide opportunities for customization where individuals can dictate the specifics they want for their spectacles.
This market strategy dictates that Optimeyes should base its operations within major Irish urban centers rather than focusing on the small ones and adoption of the internet as a marketing strategy. The prices for fashionable products should be competitive but affordable rather than cheap. However, this strategy would require the company to be ready to deal with high competition from bigger chains and new entrants. Alternatively the company can focus on customers who require spectacles due to eyesight problems. This strategy would require focusing on older generations from both rural and urban areas and use of print as a promotion strategy. Such a strategy would however prevent the company from reaping from market trends which show fashion orientation.
The available market penetration strategies for the company include cost leadership and focus differentiation. Optimeyes can be able to achieve cost leadership by offering lower prices than competitors through tight cost and overhead control and further backward integration which would require the company to source its raw materials directly from producers. Differentiation on the other hand can be achieved through enhanced spectacle designs and features, customer service and use of technology to drive innovations in order to gain from the market trends (Minarik 2007).
I would recommend that Optimeyes serves both the functional market and the fashion driven market mostly in the urban areas, so as to balance and meet the needs and expectations of consumers from the two market segments. The company can use its strength on customer service, technological innovations as a market penetration strategy coupled with low costs which would ensure that the company is able to compete with super-optical such as Specsavers and Vision Express. Optimeyes should also continue using concept of strategic management which calls for clear understanding of the operating environment so as to ensure achievement of short and long term goals and also a sustained competitive edge derived from improved and sound decision making.