New Venture Development: Pkolino Company


Internal analysis of a business helps one to identify the strengths of the business and capitalize on them in order to have an edge in the market (Kotler 2007, p.319). It also involves the identification of the business weaknesses so that one can work towards overcoming them. Pkolino deals with the development and marketing of innovative playroom furniture for children. The company targets children who are aged up to eight years. There is an opportunity in the United State for this kind of business because four million children are born each year and thus at any given time there are thirty million children aged up to eight years. The company will first target the high ended market because they value the product and they have the highest margin.

The company aims at designing the furniture for the children in order to make the play more productive. The furniture will also be designed in a way that its life is made useful by designing it to grow with the children. The company aims at creating value for the target customers by building high-quality products and creating a strong brand. This will help the customers to be very loyal to the company’s products.

A direct-distribution channel will be used by the company in order to establish a good relationship between the company and the customers. This will help the customers feel valued and thus will repeat the purchase. The company will also understand the needs of these customers and thus improve their products to meet these needs. The company will also work together with key retail showrooms which will help in displaying the company products thus creating awareness to the customers.

The company aims at being competitive in the market but the problem is that the playroom market is faced with competition from the furniture and the toy industry. The company therefore will develop furniture products and accessories designed to integrate with toys. This will help the company to offer a complete playroom which will enhance the children’s play value. This will also give the company an edge because it will get customers from toy and the furniture markets which are growing very rapidly.

External analysis

External analysis helps a business to identify its opportunities in the market and at the same time its threats (Kotler 2007, p.319). The company is facing stiff competition from companies like furniture brand international which is the largest, Lay Z Boys and Ashley Furniture are also other competitors in the market who distribute their furniture locally and internationally. The furniture market competition is predicted to be strong and therefore for Pkolino company to succeed in the market it has to adopt technology in order to ensure the quality of the furniture and also speed in production. The company, therefore, wants to incorporate the playroom with furniture and toys in order to offer a complete facility which will cater to all the children’s needs. This will also give the company an edge because it will attract customers from the furniture and the toy market.

In the united state, more children are being born and this is an opportunity for the company because the market for the playroom is increasing. Most of the mothers are having children at a later stage in their life when they have a high income and stable jobs. This is an advantage to the playroom companies because the parents can afford to buy their children furniture and toys. High disposable income in the united state is making the grandparents spend more. They can afford to purchase furniture and toys for young children. This creates a good opportunity for that Pkolino Company which is dealing with furniture and toys. Parents are getting aware of how playing is important for children’s mental, physical and social growth. This has resulted in them spending on children’s furniture and toys thus increasing the market for these items. For the company to succeed in the market it must produce furniture and toys which will meet the customer’s needs.

In order for the company to have an advantage in the market, it needs to produce quality furniture and toys to meet the customer’s needs. The market trend gives the company a lot of opportunities and thus what the company should do is understand the needs of the growing market. This will help in producing what the growing market needs, which will earn the market a big share market and a competitive advantage.

Overall potential

Company environment High potential low potential
Brand name The company can create
Distribution channels The company has weak distribution channels
product The company can differentiate the furniture by designing then uniquely
Market size High disposable income and education is increasing the need for children furniture and toys
Barriers to competition There is stiff competition from large companies
customer There is the high birth rate in united state


For the market to compete successfully and gain itself an edge in the market, some issues need to be considered. There is high competition from big companies which are distributing their products both internationally and locally. Therefore the company needs to come up with strategies to make it have an edge. Technology should be adopted in order to help the company produce quality furniture and also to increase the speed of production. Customers look for value and thus with high-quality furniture more customers will buy. This will earn the company a lot of revenue and also a competitive advantage (Kotler 2007, p.319).

The company should also work towards building its brand name. The provision of quality furniture to meet the customer’s needs will help them to be loyal to the company’s products. This will help the company have a competitive edge in the market because loyal customers will even buy the products at a premium price. Loyal customers will also help in attracting other customers through word of mouth.

Market research should be conducted by this company in order to understand the needs of the customers properly. The United States has different customers ranging from people with high income, educated people and those who get children at later ages. Therefore the company should understand the different tastes of these customers. This will help in the segmentation of the market and thus meet the different needs of the customers satisfactorily.

Diversification is also a strategy which the company should use. It should expand its market to foreign markets in order to increase the market share thus earning high revenues and also creating a competitive edge. Product diversification will also help the company to attract new customers (Kotler 2007, p.319). The furniture and toys should be designed uniquely in order to attract new customers and also give the company an edge in the market due to the production of differentiated furniture.

Reference list

Kotler, P. (2007) Marketing management. New York: Pearson Education Italia.

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