Assume your group has been engaged by Foleo Group Limited as a team of consultants. At your initial meeting with the Board, your team has been asked to propose an initiative that will expand the current operations of the Foleo Accessories business unit. This project will require the team to suggest the introduction of a new product, service or business that will achieve growth for the business unit and ultimately, the organisation as a whole. It will involve research into the specific industry in which Foleo Accessories competes, in addition to an examination of its current operations.

Foleo Accessories:

By early 2002, the two entrepreneurs were looking for ways to mitigate this problem of reduced profitability and recognised an opportunity to gain direct access to the consumer. Again, they invested time and resources into R&D to investigate the demand for, and the feasibility of producing their own accessories for the Foleo Fones.

Leon set about looking for the types of products that could be designed for their phones and by January 2003, had developed an entire range of prototypes for leather and plastic cases, along with headphones, speakers, replacement batteries, cables, car chargers and cradles, etc, all customised for the Foleo Fone. James, with the assistance of the CFO, analysed the costs and expected revenues associated with introducing these accessories as part of Foleos offering to the market, and found that the numbers looked quite favourable. The primary production plant in Western Sydney, was redesigned to accommodate the manufacture of these products and by April of 2003, a stock of Foleo Accessories was ready to be marketed and sold.

The boys knew that if they distributed these accessories for their phones through the telco providers, then they would face the same problem with price and profit margins as the Foleo Fones, so James and Leon negotiated terms with these major customers to sell their accessories from Foleo-owned Kiosks across Australia, direct to the consumer. Whilst the telco providers were initially not happy about this and viewed this move as a competitive threat to their business, the boys were able to negotiate a deal with each of them that satisfied all parties. Foleo Enterprises would supply a small range of accessories to the telco providers at retail price, which meant that, if they wished to do so, they could put a small mark-up on the items if the consumer wanted to buy a complete bundle of a Foleo Fone and the accessories in the one store

This accessory business grew quickly and by 2004, the Foleo empire now had a business unit solely dedicated to managing the retailing of Foleo Fones accessories (FOLEO ACCESSORIES). There were Foleo Kiosks set up in all major cities in Australia and pop-up kiosks were established in shopping centres and marketplaces. In time, Foleo Accessories developed on online presence and web-based sales accounted for almost one quarter of sales by 2015. The Foleo Accessories business quickly became a stable and reliable source of profits for Foleo Enterprises, as the accessories required minimal ongoing marketing, development or support.

Require

An analysis of the likely impact of the proposed initiative on the below stakeholders:

1. Customers

2. Suppliers

3. Competitors

4. Employees

5. Shareholders

6. The community in which Foleo Accessories operates.