CanGo Final Report 1

Executive Summary

In 2006, Liz Bennet realized the lucrative and efficient scope of Ecommerce. Liz established an online entertainment company, CanGo Inc that provided online video, audio, book and gaming based entertainment. This business had a scope of capturing mass market of various market segments as it provided cheap entertainment opportunities in the current era of economic crisis and increasing inflation.

Despite of having a skilled team, CanGo Inc. lacks a concrete business plan. The long term goals are vague and there are is a lack of clear strategic plan as to how those goals will be achieved. While a clear organization structure is present and hierarchal positions are well defined, too much centralized decision making prevails. Lack of proper communication channels results in uninformed decision making and employees are often left with little sense of clear direction. This means that there capabilities are not being utilized efficiently.

The online entertainment industry is getting saturated each day and competition is very tough. The increasing rate of uncontrolled piracy is adding extra competitive pressures. This calls for the organization to develop an aggressive marketing strategy in order to ensure its survival in the market.

Introduction

With the invention of World Wide Web, the corporate sector has evolved into new dimensions. The fast, quick, reliable, accurate and efficient internet systems of E-commerce have provided the world with new and unique business opportunities. More and more entrepreneurs are now taking keen interest in a completely online business rather than a conventional brick and mortar business. This has made the internet a multibillion dollar industry (Plant, 2000). It has also created more employment opportunities and has made lives of businesspersons, employees and the consumers much easier. Considering the lucrative opportunities offered by E commerce, CanGo Inc. was established by Liz Bennet in 2006.

CanGo Inc. is a 100 percent online company that deals in providing E-commerce business solutions. The company specializes in online entertainment including books, magazines, and audio and video entertainment forums. The company aspires to make its mark in the online gaming industry as well. The company was founded in 2006 by Liz Bennet and it currently has four consultants. Since then, the company has strived to make its mark in the internet corporate industry. One of the company’s major achievements includes being chosen as the Regent Business Leader of the Year in 2009. Having said that, the company still has lots of weak areas that need to be worked on. The major pitfalls of the company include lacking a concrete business plan and serious issues with personal management.

SWOT Analysis

The SWOT analysis for CanGo Inc. is discussed under the following sections.

Strengths

  • CanGo Inc. is a 100 percent online establishment with zero brick and mortar existence. This makes the business cost efficient.
  • CanGo Inc. primarily caters to online entertainment industry. This is a highly profitable sector with an immense scope of growth. Online reading, magazines audio and video consumers are increasing everyday that provides CanGo Inc. with a broad consumer base.
  • CanGo. Inc. has a cohesive and well motivated work force that is both skilled and innovative.

Weaknesses

  • The most basic weakness of the organization is the lack of a concrete and cohesive business plan. Lack of business plan can pose serious problems in setting and achieving long term strategic goals.
  • Despite of a well motivated and skilled workforce, CanGo Inc. is too centralized as far as decision making is concern. Often, it delays the decision making process.
  • Too much centralization and communication gap results in uninformed decision making. Decisions are not properly communicated to the workforce, which in turn results in lack of clear direction among employees.

Opportunities

  • The increasing accessibility of the internet around the world will enable the company to have an international consumer base and make its existence in other countries as well.
  • CanGo Inc. is planning to expand into the online gaming market. With the increasing trend of online social networking, this has immense profitability chances.

Threats

  • The online entertainment market is getting more and more saturated as more and more entrepreneurs are stepping in the industry.
  • The increasing piracy and easy availability of torrents attract people away from paid websites
  • Absence of a concrete business plan has resulted in a lack of concrete performance based goals.
  • Lack of employee benefits might result in demotivation of employees in long term.

Market Analysis

The internet entertainment industry is now a multibillion dollar industry that is highly saturated. As far as video entertainment is concerned, YouTube holds the largest market share with an almost monopolistic existence. Online gaming is getting more popular in the form of social gaming and the major market share is held by Zynga. As far as music and Ebook is considered, easy availability of illicit pirated material attract people away from using paid legal websites.

Competitor’s Analysis

As mentioned earlier, the online entertainment industry is getting more and more saturated each day. As far as online gaming is concerned, major competition comes from free online gaming sites such as Miniclip.com and social network gaming companiesZynga. It has been observed that social gaming on Facebook is getting much more popular then conventional online gaming. In order to compete, CanGo Inc. can collaborate with Facebook and develop social gaming just like Zynga. Social gaming also has an added advantage. It allows the gaming company to market other products of the company through the game and can promote the company to a large number of people registered on the social networking sites. Apart from that, CanGo Inc. also faces competitive pressures from websites that allow free downloading of pirated material and torrents (Lauden & Traver, 2008).

Financial Analysis

CanGo Corp. has survived well as far as financial aspect is concerned. It had not faced any cash flow problems so far. Initially, the gearing ratio was a bit high but with a low payback period of just two years, it managed to control the gearing. Proper management of weak areas can result in improved sales and reduced costs which will result in higher profitability.

The financial statements of CanGo Inc. are given as follows:

References

Lauden, K. & Traver, C. (2008). Ecommerce. USA: Prentice Hall.

Plant, R. (2000), Ecommerce: Formulation of strategy. USA: Prentice Hall.

Subramani, M. & Walden, E. (1999). The Dot com effect.International Conference of Information System 1999.

Tedeschy, B. (2001). E-Commerce Report; The computer game industry seeks to bridge an online gap between geeks and the mainstream.The New York Times.

Wood, L. & Szydlik, S. (2000). E-treprenuer. Canada: John Wiley & Sons.