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1-800-GOT-JUNK? - Case Study MGT2328_W21 Team Assignment 2 - Part. 1 & 2 Date: April 16, 2021

Linh Lam John Carusi Jared Feldman Roberto Jimenez-Paduch

Contents Part 1: Situational – Analysis...............................................................................................................3 Strengths................................................................................................................................................3 Weaknesses..........................................................................................................................................3 Opportunities.........................................................................................................................................4 Threats...................................................................................................................................................5 Part 2: Decision Making – Analysis....................................................................................................5 Core Problem........................................................................................................................................5 Identification and Explanation of Alternatives...................................................................................6 Evaluative Criteria and Weights..........................................................................................................8 Analysis of Alternatives........................................................................................................................8 Decision and Justification....................................................................................................................9 Reference:..............................................................................................................................................10

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Part 1: Situational – Analysis Strengths 

Seek expansion: After CEO Brian Scudamore established 1-800-GOT-JUNK? The company established a sense of growth and caught traction; Scudamore also started two newer franchises: Wow 1 Day Painting and You Move Me.

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Franchise model: For business success, a franchise model is an easy way to manage an expanding business. The company has more than 2000 franchises; In 2005 and 2006, it was listed as Entrepreneur magazine's 100 fastest-growing franchises. In 2011, the system-wide revenues were over $100 million.

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Substantial brand equity: 1-800-GOT-JUNK? Was named one of the Best Employers in Canada by Canadian Business, and Scudamore won the International Franchise Association's Entrepreneur of the Year award.

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Technology integration: The firm established an efficient means of communication between employees, franchisees, and clients by using JunkNet- the company's proprietary intranet and customer relationship management site to access schedules, customer information, and real-time reports. Also, the company utilizes the use of GPS to save on gas by the mileage.

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Leadership and teamwork: All employees at the Junktion meet for a seven-minute huddle every morning; they share good news, announcements, metrics, and problems they are encountering. It is an excellent way for a team to build relationships among members and aid in team development and success.

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Clear company vision: Junktion created and shared with the executive team about the "Vision Wall," which contains the varied outputs of Scudamore's brainstorms. Describing what the future may look like by visualizing a future where GOT-JUNK? Has expanded sufficiently and what the purpose of the new space could be.

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Different Services: Their business has a lot of different markets and services such as storage services, commercial junk, and renovation cleanup.

Weaknesses 

Business diversification: The brand has established itself only in junk removal and has not diversified its business into any other service lines. A significant drawback since business diversification is crucial for any brand for constant development.

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Cyber security: The use of technology presents risks such as cyber-attacks or privacy concerns that can damage customer trust and tarnish brands. This type of disruption will cause performance issues for both the franchisor and the franchise partners, such as through the proprietary intranet.

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Small niche: Most of the customers of a junk removal company tend to be current homeowners, which means the industry is somewhat seasonal.

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Going the franchise route: The company assumes a degree of risk to its business. If the franchisees do not offer good service to their customers, the credibility of the brand, GOT-JUNK?, will be affected.

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Lack of marketing: No investment into marketing means GOT-JUNK? cannot determine specified customer behaviors in the demand market. With customer data, the company can make a marketing plan advertising the services offered.

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Cost margin: 1-800-GOT-JUNK? May face issues with some customers as there is no set pricing; thus, prices are relative to each client and their items space consumption.

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Inefficiency: Since 1-800-GOT-JUNK?’s pricings are set according to estimates, if customers are not happy with the price offered, 1-800-GOT-JUNK? Will leave without any charges. As a result, the time traveling to and back from the location expenses gas and time from the company.

Opportunities 

Regional expansion: The increasing presence of locations across regions with an already strong brand reputation opens the market to new possible clientele.

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Partnerships: Attract more enterprises to join in the franchise's business model with an already established technological and innovative advancement in performing services.

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Improve service quality: In today's economy with the internet, people are more aware of brands and concerned about quality. There will always be areas of improvement in offering quality services and learning from customer reviews, critiques and feedback.

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Customer's approach: Connect and build relationships with customers who are satisfied with the brand, as clientele rather than only consumers. Availing this opportunity will increase the revenue and profit for the company long-term.

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E-commerce and social media presence: Used as tools for marketing and influencing consumerism; not only reduces the cost of entering a new market and reaches more potential customers but also attracts more franchisees.

Threats 4

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Government policies: Regulatory requirements need to be followed when offering any product or service; further expansion into new markets; requirements need to be fulfilled before further establishing.

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Competition: Due to uncomplicated business and low entry barriers, the company can face high tight competition levels. With the entry costs being meager, there has been a rising trend in the local companies, increasing competition, and decreased profit margins.

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Rising industry cost: Fuel is one of the primary input costs for this industry, as it is used to power the trucks. Therefore, as gas prices inevitably continue to increase, the company will need to invest more and more.

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Differentiating social and cultural norms: From region to region can influence the company's business model's certainty. Barriers related to culture play a significant role and affect the decision of GOT-JUNK? to expand internationally.

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Economic condition: A recession within the economy will affect consumer spending, resulting in little available profits. Demand for lower-cost services will trump customer loyalty.

Part 2: Decision Making – Analysis Core Problem What business strategies should 1-800-GOT-JUNK? take in order to improve the company’s change-capable ability and culture?

Symptoms 

#1 Even in such an uncomplicated business as hauling people’s junk, the company faces constant forces in the environment (external and internal) that bring about the need to change. Besides, Got-Junk must more concerned with managing change and innovation if they desire to expand the International market and increase the profit.

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#2 The external factors are dynamic and can be changed at a rapid pace. Over time, the changes might occur and influence the certainly of company in the present or the future. Got-Junk needs to concern and gives some predictability to improve the company’s changecapable ability. Although the analysis is supposed to be insufficient for the strategic planning objective in long term, it can reduce the competitive scenarios and internal environment.

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#3 The technological advancements have created significant economies of scale to provide lower costs, higher efficiency, and greater innovation for both Got-Junk and their partner franchisees. Now away, technology continues to rapidly evolve, so the firm has to stay on top of technological changes that may affect everyday processes.

Identification and Explanation of Alternatives Alternative One – Management Strategy: Taking greater focus on improving employee and partner franchise morale by organizing events, offering benefits and employees and franchise involvement. 

+ Advantages + Assisting entire employees and company partner franchisees to adapt and turn proactive with new changes which are both internal as well as external.

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Employee performance: to increase employee's productivity and improve the quality of their work as well as develop cross-functional of the individual employees.

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Adding opportunities to attract and retain staff, reducing the need for supervisory functions.

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Expanding access to capital through attraction investors and franchisees, which ultimately leads to improved financial performance.

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Being successful holds loyal customers and attracts more potential customers.

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Increasing market share and profitability of the company in the market.

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Avoiding competitive convergence: the firm has a unique identity that will keep GotJunk apart from its competitors and increase a competitive edge over the market.

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– Disadvantages – Spending a lot of time researching, preparing and informing the employees and the partner-franchisees.

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Emphasizing the attainment of the objectives and does work on a systematic plan for the same that can pressure for their employees.

Alternative Two – Customer Service Strategy: Focusing on improving relationships with customers by providing above and beyond customer service. + Advantages + 6

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Defining price is no longer the only competitive factor: a competitor is cheaper does not mean they will always come out on top.

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Offering many avenues for promoting the company's image by creating its presence on numerous social media platforms.

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Increasing customer loyalty. When the customer has been happy with the service in the past, they will stick with the company rather than bothering to find another provider.

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Creating relationship-building and brand awareness: The more valuable its brand, the more loyal customers are.

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Gaining higher margins of profit. – Disadvantages – Being a long-term strategy that requires wholehearted efforts by the marketing team.

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Cannot control negative comments to affect brand reputation.

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Getting stiff competition. It is hard to make Got-Junk stand out in online marketing

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unless paying a large amount of money to increase its brand to the top of searching. 

Excluding consumers: Too much specificity and marketing to a niche audience can exclude a majority of the market such as shopping malls, commercials, construction, and so on.

Alternative Three – Development product strategy: Maximize the opportunities to improve the products is centred on protecting the environment. Got-Junk will sort through customers' unwanted things to ensure they find a new home through recycling and reusing good items that donates to local charities. 

+ Advantages + Expanding market: to create a culture of innovation to support the next step so that a greater market share can be captured by a brand and business.

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Creating motivated employees to grow a professional network to attract more consumers and partner- franchisees.

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Boosting value and profitability: to raise brand loyalty and gaining higher margins of profit. Also, the firm will have a strong reputation amongst domestic industry players.

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Increasing customer relations: Got-Junk can attract and retention of clientele by

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driving a higher value proposition to create more repeat buyers. – Disadvantages – Nothing is guaranteed; even if their service is superior in every way, customers may not go for quality due to competitive pricing. 7

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Increasing production costs.

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There is nothing in place to stop another brand from adopting this strategy, creating an ultra-specific service that is also disruptive.

Evaluative Criteria and Weights Evaluative Criteria

Relative Weights 35% 20% 15% 30% Total Weight Sum = 100%

Company Culture Employees Company Franchisee Partners Profits

Analysis of Alternatives

Alternatives

Company Culture (0.35)

Employees (0.20)

Company Franchisee Partners (0.15)

Profits (0.30)

Total

#1 Management

0.35 (10) = 3.5

0.20 (10) = 2.0

0.15 (9) = 1.35

0.30 (8) = 2.4

9.25

0.35 (8) = 2.8

0.20 (9) = 1.8

0.15 (7) = 1.05

0.30 (9) = 2.7

8.35

0.35 (9) = 3.15

0.20 (9) = 1.8

0.15 (8) = 1.2

0.30 (8) = 2.4

8.55

#2 Customer Service #3 Development product

Decision and Justification After completing the Alternatives analysis, we have a good sense 1-800-GOT-JUNK? can improve the company’s change capable ability and culture by developing some business strategies. Based on evaluating weighted criteria and further analyzing the alternatives, the

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Management strategy is alternative scored the highest at 9.25. Thus, management strategy is an alternative that provides the most viable solution to the problem. In determining the symptoms of the core problem for this study, we found that 1-800-Got-Junk? maybe to face the uncertain environment in the future. Got-Junk needs to build the engagement of employees and partners cohere to the company’s business objectives and visions. Management strategy is to combine the training and rewarding to motivate the employees. Training and development increase the value of employees to the organization strengthening the feeling of workers that they are an accepted part of the collective unit, so they need to contribute to the success of the firm. Also, giving reward to employees and the partner-franchise increase connection of the existing workforce to the company. For instance, Got-Junk can organize events or travel tours for their workforce which brings unity about the strong central culture is all-pervasive. With attention to the management strategy is put in place, Got-Junk will be able to successfully attract and retain the best hands it can get in the industry. Entire employees and partners-franchise share values keep the entire organization together and help create an environment of trust. They will be more committed to helping Got-Junk build the business of its visions which is critical for being competitive and taking bigger challenges. Besides, Got-Junk should maintain the core elements of its business model to better position the company for future growth and success. The company should pay special attention to the location of the partner franchise and enhance the advanced technologies is going to use to get maximum profitability in both short and long run. The most important thing which is focused on was the quality and the market forces which directly affect the business.

Reference: Biz Funding Resource. (n.d.). Junk Removal Service Business Plan, Marketing Plan, How To Guide, and Funding Directory [Web log post]. Retrieved April 07, 2021, from https://bizfundingresource.com/junk-removal-service-business-plan-and-swotanalysis/#:~:text=A%20junk%20removal%20service%20SWOT%20analysis%20is %20frequently,as%20sales%20of%20valuable%20refuse%20can%20be%20significant. 9

DeCenzo, D. A., Robbins, S. P., Coulter, M. A., & Anderson, I. (2020). Fundamentals of Management, 9th Canadian Edition: Pearson Education Canada. Indeed Career Guide. (2021, February 11). SWOT Analysis Guide (With Examples). Retrieved from: https://www.indeed.com/career-advice/career-development/swot-analysis-guide Min Tools. (n.d.). SWOT Analysis How to Develop a Strategy For Success. Retrieved from: https://www.mindtools.com/pages/article/newTMC_05.htm Study Corgi. (2021, January 1). McDonald’s Business and Corporate Level Strategies. https://studycorgi.com/mcdonalds-business-and-corporate-level-strategies/

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