Billabong case study free essay sample

1. Outline the current difficulties faced by Billabong’s management. Billabong is currently facing a number of difficulties that are both internal and external. One of the biggest problems currently faced by Billabong management is the lack of support from institutional shareholders. 2. Describe the factors that have led to Billabong’s current success/decline. One of the main factors is 3. Explain why changes were made to Billabong’s management structure Changes were made to the billabong management structure because of the poor decisions made by management over the past 10 years. Billabong was â€Å"littered with poor investment decisions, strategy blunders, hubris and flat-footed management responses to structural changes in market conditions† said Elisabeth Knight. The biggest change was changing the chief executive Launa Inman, even though the support from institutional shareholders was missing. The Billabong management was also criticised by Elizabeth Knight for the â€Å"overspending on brand acquisitions† which she believes is the simplest explanation for why the business is currently failing. We will write a custom essay sample on Billabong case study or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page The new chief executive officer Launa Inman 4. Based on the articles provided, assess what changes Billabong could make to keep the business sustainable. For Billabong to become a sustainable business and keep operations they need to turn back to the roots, the surfers. As Alexandra Cain said, Billabong have to take a lesson from this, which is â€Å"never turn your back on your main market, namely passionate surfers†. Those surfers are the roots of the billabong company and with Billabong moving into the fashion market, the attention was no longer on the surfers. Another change is to take a fresh aim at the youth market, although it would be a struggle due to the financial state of the company. 5. X 6. Describe the changes in sales revenue and earnings per share between 2011 and 2012 and identify possible impacts these changes could have on the business. Billabong share prices suffered a large drop in value from 2011 and 2012. The share price of 31.1 cents dropped a considerable amount, losing 158.7 cents. The $114,380,000 loss from 2011 to 2012 had a major impact on many parts of the Billabong company.