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Lego Case - Current Strategies and Implementation

Essay by   •  November 12, 2011  •  Case Study  •  449 Words (2 Pages)  •  2,869 Views

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Current Strategies and Implementation

Since there was a significant result in increasing its inventory turnover, The LEGO Group should continue focusing on improving changes to design, production, distribution and sales. LEGO should continue expanding its production capacity with finding the way to reduce any cost, in addition to increase its avenue. Nowadays, internet will be a huge potential market for all the industries, which also include toy industry. As a result of launching online business, LEGO received a pretty good result. Consequently, continuing its virtual online business will be the part of LEGO's current strategy.

Key Issue(s) of the Case

The major key issue for LEGO is the loss of trademark protection from the lawsuit. The implication is that as long as more competitors emerge in the market, LEGO's products would be duplicated soon without any protection, which means that LEGO might lose its competitive advantage. There could be two minor issues along with it. One is the product development and another is the direction of its sales channel. While there is a strong competitor existed in the market, lots more pressure LEGO will have. Then product's specificity will become more valuable and important, in order to earn more market share. Figuring the way and direction of sales could be necessary as well. LEGO can maintain the position of dominance in the building toy market in the years ahead.

External Analysis

Toy industry is an industry that manufactures and sells toys for children. This industry would be affected due to six factors, which are political, economic, social, technological, legal, and environmental aspects. There are some opportunities and treats exist that each toy company will face.

Because of both stable economic and political sectors, LEGO and other educational toy companies get opportunity to prosper in the local region and global market, with the way for improvement of products. The society accepts the products that LEGO and other educational toy businesses offered. All the toy companies engage in social activities that help to keep balance and a better relationship between them, clients and the society. The technological factor dictates the trends in the toy industry. Since LEGO keeps update their technologies, they domaine the market all the time.

However, as long as competitors move faster with the new technology or duplicate LEGO's products, this temperary opportunity will turn into threat. Due to the environmental aspect changes, the new product should be considered to meet the new demands of the region and a certain market. Competitors entered the market by launching a new rival product line faster, such as Hasbro, it becomes a obvious threat towards to LEGO. Thus, whether could maintain the dominance position in the

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