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Shimano

We are doing a case study about company "Shimano".

I would like to get some answers to the following questions:

1. Should the bicycle manufacturers think about vertically integrating into component production? Why or why not?

2. Why is the high-end bike industry a global one?

3. Why is Shimano also in the fishing tackle business?

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1. Should the bicycle manufacturers think about vertically integrating into component production? Why or why not?

Yes, the bicycle manufacturers should think about vertically integrating into component production to obtain greater control over the input cost and thus, significantly improve on operating margins and cost structure. The synergies obtain via vertical integration will help the bicycle manufacturer to become more competitive in the marketplace.

Bicycle manufacturers can significantly benefit from economies of scale and can reduce threats from powerful suppliers. Further, it ensures them steady supply of components.

2. Why is the high-end bike industry a global one?

High end ...

Solution Summary

Should the bicycle manufacturers think about vertically integrating into component production? Why or why not?

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