Porter’s Five Forces
❖ Bargaining power of customers:
As we very well know plumbing is a wide industry, “there are a massive number of plumbers worldwide than you can imagine”-Fabricio Soares. Therefore, Four Seasons only focuses on new construction only. They have over nine different general contractors that hire them to complete contract-based projects. They also have over 12 different active projects in which they are currently working on. Given that the plumbing industry is a very dynamic environment and that has an overload of demands there is a high percentage of bargaining power of customers. To diminish this rate, they find innovative ways to keep them working all the time such as only doing new constructions and contract-based projects with general contractors.
❖Threat of substitutes:
As mentioned before, the plumbing industry has a wide range of variety and is very wide. This makes it much more difficult for them to get customers, which is why they only work for general contractors and do new construction only. However, it makes it much easier for a customer to find the best plumber that fits their needs because they have many options to choose from.❖ Bargaining power of suppliers:
Is their duty and part of their contract with the general contractors to provide the necessary supplies and materials to complete the project. When they buy the supplies and material, they invoice the general contractors accordingly. They have over five different supplies and when they buy out from them, they have the choice and upper hand to buy. They first ask all their suppliers for a quote with all the prices of the material and compare them to analyze which is the best price. As for the bargaining power of suppliers, they have the ability to lower or raise their product prices. Given that they have a long-term relationship and trust with some of their suppliers like General Plumbing Supply and Ferguson Enterprise they always try to accommodate them as best possible.
❖ Threat of new entrants:
The fact that new plumbers graduate every year and get their license is not easy for the plumbing industry in which Four Seasons lies. This market constantly has new entries which make it hard for them to find jobs and easy for the customer to choose from.
❖ Rivalry:
“Four Seasons experiences rivalry all the time”-Michelle Fernandez (executive director). Given that it is a wide industry they always face rivalry in the field they are bidding for jobs because there is a high number of plumbers in the market. They constantly have to come up with competitive prices as this determines the project's award.
Competitive Strategy
❖ Cost advantage or differentiation advantage:
What competitive strategy do they implement in the company? Cost advantage or
differentiation advantage. Explain.
Their competitive advantage focuses on bidding and getting awarded with projects that best fit their profile such as residential buildings, not too many units, and contract-based because it prevents any misunderstandings and assures the flow of the job. Also, they always try to keep the same general contractors as they already have a long-term relationship and know the process. The most crucial strategy they have is keeping their team synchronized, being proactive, and having a healthy relationship with all their employees and staff. In Four Seasons they believe there is a differentiation advantage as they do their best to provide their customers with the best service and prices, they can offer them.
Business Processes
● What is the Business Process of the company?
Their business process consists of first:
Bidding out different jobs coming up with competitive prices.
After they are awarded to them, they create a proposal which consists of all fixtures and equipment they must use.
They review and sign contracts.
Revise plans and approved submittals which are all the fixtures and equipment that they must use.
They start their inventory and order material.
Layout the field and hire subcontractors to complete part of the project.
They invoice the general contractors to get paid for the job completed.
After the project has culminated, they get paid for the retainage and comply with all closing documents.
❖ How do the information systems support strategy? Explain.
To carry out and manage their business operations information systems are crucial. The majority of their business processes rely on information systems otherwise the job would be time-consuming, and their contracts are time-limited. For complying with any information, they do it via software such as Textura, they lay out the plumbing plans through the internet, and they invoice out contractors via software. Without software, hardware, and the internet there is very little they can complete.
Service Value Chain Analysis
❖ Inbound Logistic:
Their Inbound Logistics consists of ordering the fixtures and supplies from their vendors.
❖ Operations/Manufacturing:
When they receive them, they count and verify nothing is missing and have the correct amount.
❖ Outbound Logistics:
They store them in the warehouse and let the field guys know it is ready to be picked
up or sometimes they get delivered straight to the job site.
❖ Sales and Marketing:
The only marketing, they do is establish uniform conduct, have their logo in every van
and have a list of all the projects completed.
❖ Customer Service:
The customer service they provide is to their general contractors by completing them
awarded jobs as stated by the contract and within the time limit.
