Victoria Heavy Equipment

Limited Analysis
Group-10
Aayush Jain (UM15311)
Asutosh Patro (UM15321)
Pratik Kumar (UM15341)
Pratik Singh (UM15342)
Sanjog Saran (UM15351)

Contents

Market Observations
Financial Analysis
Industry Overview
Future Prospects
Organizational Structure
Short Term Suggestions
Middle Long Term Plan

Market Observations
Sales volume of Victoria in 2007 was 150
mil. as compared to sales volume of 600
mil. of Washington Crane Company.
Sales growth of Washington crane
company is above 15% all throughout the
period from 2003-07 .
No consistent growth in income.
Steep fall in income in 2007 as an effect of
rise in cost and low sales growth.

Contents

Market Observations
Financial Analysis
Industry Overview
Future Prospects
Organizational Structure
Short Term Suggestions
Middle Long Term Plan

Financial Analysis
Growth in sales
25.00%
20.00%
15.00%
10.00%
Rate of growth 5.00%
0.00%

Key observations:
Current ratio lies between 1 and 2.
Fixed Asset > Long term debt
Debt to Equity ratio < 1
Return of Equity was 3.5% in 2007.
Fixed Asset Turnover ratio increasing.

Growth rate

Contents

Market Observations
Financial Analysis
Industry Overview
Future Prospects
Organizational Structure
Short Term Suggestions
Middle Long Term Plan

Industry Overview
SWOT

Industry Analysis

Strengths:
Cost leadership
Weakness:
Inefficient and old equipment.
Poor coordination because of
decentralization
Lack of motivation for employees
Single source of revenue
Opportunities:
Further cost reduction by new
technology
Threats:
Entry of Toshio in North American
market.
Lack in machine dependability
Lack of service compared to
other competitors
Financial Crisis: Recession in US
market

Maturity stage in US and

Canada
Low growth in this Industry
Market leaders are defending
their market share by
introducing new product lines
Competition
New entrants
Toshio, Japanese Manufacturer
Internal Rivalry 5 major
firms
Washington crane is market
leader
Texas Star, focuses on small
crane
Other two are multinational
producer, cranes are small
part of business
Buyers-

Contents

Market Observations
Financial Analysis
Industry Overview
Future Prospects
Organizational Structure
Short Term Suggestions
Middle Long Term Plan

Future Prospects
Sales growth figures declining over the years
Ineffective communication between layers of organisation
Single product line leads to total dependency on one
product
Lack of a strong leadership: Need to supervise and
streamlining the process
Lack of motivation of staffs due to complex organisation
structure and loss of pay during decline phase
Taking into the consideration of firm's performance, strategy,
organization structure, competition and other environmental
factors, the future of firm is not so bright.

Contents

Market Observations
Financial Analysis
Industry Overview
Future Prospects
Organizational Structure
Short Term Suggestions
Middle Long Term Plan

Organisation Structure
Chairman
& CEO
Brian
Walters

President
M. Carter

Employ
ee
Relation
s
M. Fenn

Craneco
Ltd.
J.
Cramer
Presiden
t

CraneCorp
Inc.
R. Fellows
President

Engineeri
ng: R&D
David
Walters
(Acting)

Executive
Committee
M. Carter
(Chairman)
M. Fenn
J. Cramer
R. Fellows
Diane Walters
David Walters
N. Hayes

Victoria
Marketing
Ltd.
Diane Walters
President

Victco Ltd.
David
Walters
President

Finance
& Admin.
N. Hayes

Contents

Market Observations
Financial Analysis
Industry Overview
Future Prospects
Organizational Structure
Short Term Suggestions
Middle Long Term Plan

Short Term Plans (< 6

months)
Chan
ge

Central
Leadership

USA

Canada

Manufacturi
ng

Manufacturi
ng

Finance

Finance

Personnel

Personnel

Marketing

Sales outlet
and
dealership

Service

Vitco Ltd.
(Component
s)

R&D

Plant Location :
Sacramento
Products :LTM 1000;A-100
& others
Domestic Market 15 %: 54
Million $
No. of Cranes : 60-70
Export : Countries involving
US aid and financing
Equipment / MC : Fairly
new
Advantages : New
Machinery
Market share less

Plant Location : Squamish

Product s: LTM 1000 only
Domestic Market : 60 % :
39.6 Mill
No. Of Cranes : 130-150
Export : ROW not covered
by US
Equipment / MC : 15 % NC
Advantage s: Single
product efficiency
Bulk of exports

Total Sales : 151 Million $

Role of central Leadership

1. Allocation of capital budgets.
2. Strategic decisions

AREA
Marketing

Autonomy

Present
Three divisions

3 cost + 4 profit centers

Proposed changes
Single division with three departments ;
Ensure co-ordination in approaches of the
autonomous divisions
3 Profit and 1 cost center ; The autonomy of
the divisions are maintained

Involvement of top
executive

Operational

Strategic

Process Flow

Uni directional

Bi directional to ensure better co-ordination

Profit Sharing

Bonus : Overall as well

as divisional profit

Bonus : Corporate structure : Overall profit

sharing
Divisional structure : Divisional profit sharing
only

Staff Groups

Central and divisional

Central

R&D

Handled by
subcommittees

Alleviated role : Under central leadership

Service

No Existent

Under marketing : As there is customer

contact

Duplication of Staff
Functions

More

Reduced

Central control on
spending

Lacking

Primary role

Contents

Market Observations
Financial Analysis
Industry Overview
Future Prospects
Organizational Structure
Short Term Suggestions
Middle Long Term Plan

Medium Term and Long

Term Plan
MEDIUM TERM PLAN
(6 months-2 years)
Renewed focus on service and
maintenance
Replacement of machinery at
Canada
Plant
LONG
TERM
PLAN
(more than 2 years)
Single Product Concentration
Manufacturing setups in other parts
of the world
Diversify into similar product line

Thank You