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Adam Burke and PBM Plastics Message in a Bottle Case Solution

Solution Id Length Case Author Case Publisher
2539 975 Words (5 Pages) Gerry Yemen, Elliott N Weiss Darden Business Publishing : UVA-OM-1491
This solution includes: A Word File A Word File

PBM Plastic’s apparent business level strategy is that of focusing on a firm’s scope of operations. More specifically, this focus on operations is being maintained so that the company is able to pursue a broad cost leadership strategy. Under this strategy, a firm aims to become a broad cost leader (Henry, 2021). This means that companies and businesses work towards providing acceptable levels of service, quality, and features in their offerings to a broad market segment. The competitive advantage for these companies, therefore, stem from the cost of the goods sold, and the lower price offerings for its product. This helps broad cost leaders in maintaining the competitive scope within the market where they play (Lynch, 2018). 

Following questions are answered in this case study solution

  1. What is PBM Plastic’s apparent business level strategy?

Case Analysis for Adam Burke and PBM Plastics Message in a Bottle Case Solution

The current case has focused on the decisions of Adam Burke to steer the strategy and success of PBM. PBM was a manufacturer of infant formula in Gordonsville, Virginia. Adam Burke noticed that one of the leading players in the market of disposable baby bottles was Playtex. Playtex had introduced the disposable bottle liner and eliminated the need for bottle sterilization for the consumers i.e. the parents of infants and younger toddlers. The new system also reduced the air levels that were being ingested by the baby. As a result of this innovation, the Playtex bottles became the industry standard, and led to increased popularity, awareness, and acceptance for the Playtex brands and bottles. Adam however, noticed that no one in the market was competing with Playtex, and that no one had introduced similar bottles at competitive rates – thereby allowing Playtex to enjoy the majority of the market share. 

PBM Products lured Adam Burk, and invested seed money to launch PMB Plastics – producer for Playtex-compatible preformed plastic baby bottle liners. While the company entered the market for disposable baby bottles for efficient and effective competition, it also wanted to ensure that it did not compromise on the product quality, and design. To be able to compete headstrong with Playtex, the market leader, the company would need to offer similar features and benefits, and even improved ones, but at more compatible rates. This is why the apparent business level strategy for the company appears to be that of cost leadership, or broad cost leadership (Lasserre, 2017). Since the company does not focus on a narrow or a specific target market, and instead focuses on the broader population segment that uses infant formula to feed their infants and babies, the broad cost leadership is more apt.

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