Its Competitors In The Human Blood Market example essay topic
There is considerable flexibility in switching from the manufacturing of one product to another, and BPC can manufacture both at the same time (given the resulting linear function from the capacity figures above). These capacity numbers, however, are limited in comparison to the larger potential market. Given its competitors in the human blood market, BPC would be place third among three competitors, whereas in the canine market, it would have a monopoly for a minimum of two years. As such, BPC would likely be a price taker in the human blood supply market, whereas it would be a price setter in the canine market, allowing it to maximize profits by charging the highest possible price given its current capacity. An under supplied marketplace for both humans and canines will allow for sufficiently elevated prices (Exhibit 3).
In performing a VAIO analysis of BPC (Exhibit 4), one sees the unique use of bovine precursors and product differentiation of Og as sustainable competitive advantages. The unique raw material provides a variable cost advantage. As well, the seasonal variation in human blood supply would not affect BPC's supply of raw materials as it would for its competitors. Hp, while a valuable resource for BPC, cannot be considered a sustainable competitive advantage due to its two competitors. Its lower-cost production process allows BPC to position itself as a lower-cost producer.
However, this would be difficult to take advantage of as it will have to take the price set by the market leader. While this would still provide for higher margins, the percentage gain would be minimal compared to the otherwise high margins. The company is seriously interested in pursuing an IPO, which could be greatly enhanced with a product in the marketplace generating revenue, an established customer base and experience in producing large amounts of blood substitute in its facilities. As well, the revenues from an Og launch could generate additional funds for the future launch of Hp.