Trunki is an innovative ride-on children’s suitcase produced by a Bristol-based design company called Magmatic Ltd. Rob Law is the owner and the director of this company and the brains behind the Trunki suitcase. Law came up with this investment idea in 1997 while at university and turned his investment idea into practice in 2003 but the company that he established collapsed as a result of various obstacles (Bourret, 2012). However, Law re-established the business in 2006 and a potentially damaging appearance on BBC’s Dragons Den program turned his venture into a success. His idea was dismissed by the dragons as unworthy but the fact that he featured in the TV series brought awareness of Trunki to the public. As a result, consumers, distributors, and retailers got interested in the product. This led to a tremendous increase in sales of Trunki within a short period of time. By June 2012, Magmatic Ltd had sold over 1,300,000 suitcases and made a £6m-Turnover and a profit of £1m in the previous year (Bourret, 2012). This paper analyses various issues affecting the production, sales, and marketing of Trunki.
- a) The identifiable risks for Trunki, how can they be planned for and the risk reduced
As in any other business enterprise, the sale of Trunki by Magmatic Company is exposed to various risks, which may negatively affect its performance. One of the major risks that this company may be facing currently is a financial risk. According to BBC (2009), Law funded the growth of this investment mainly through debt financing from an angel investor and from financial institutions such as Prince’s commercial banks and the Small Firm Loan Guarantee. The company has not completely re-paid the loans and interests and therefore, it is exposed to the risk of inability to re-pay, in case sales and cash flow level reduces greatly enormously (Besley & Brigham 2008, p. 586). This risk may be counteracted by the continued strong performance of this company. Additional financial risks associated with Trunki relates to any changes that may occur in the tax and foreign exchange rates, which may adversely affect the company’s returns. These changes are external to the business and hence, difficult to control.
Trunki is also exposed to a strategic risk associated with the possibility of change in consumer tastes and preferences in the future. This risk can be counteracted by establishing measures that will help to keep track of consumer feedback (Besley & Brigham 2008, p. 586). Finally, this company is exposed to the risk of compliance with bureaucratic or legislative rules and regulations in all the countries where it operates. These include environmental concerns and employee protection regulations. Such risks can be mitigated through gaining awareness of the rules and regulations governing the industry and remaining compliant to them in all countries where this company operates (Besley & Brigham 2008, p. 587).
- b) The possibilities of failures for Trunki, their identification, their outcomes, and their effects
The possibilities of failure for Trunki are currently low due to its strong performance in recent years and the high possibility of future success in the global market (Smarta, 2012). However, this business may fail under various circumstances. For example, a change in the tastes and preferences of consumers and failure by the company to investigate market changes, leading to lower sales for Trunki. Also, new competitors may rise, with better products and services compared to Trunki’s products, thereby snatching the market share for Trunki. Additionally, new laws and regulations may be developed restricting the production and/or sale of Trunki. Under such situations, the company would record negative returns. The declined financial performance would eventually lead to the collapse of this business ((Besley & Brigham 2008, p. 598).
- a) The alternatives for financing for Trunki and the most suitable financing source
Magmatic can use either debt or/and equity financing to expand Trunki into new business areas (Ajami & Goddard 2006, p. 299). The main source of equity funding for this company currently is retained profits from this business. Trunki can also use debt financing from banks, government agencies, asset-based lenders and business suppliers. Trunki is a well-established business venture with a proven record of success. The company’s sales have been increasing at a high rate in the last few years, with high levels of profits recorded (Smarta, 2012). Therefore, it is likely that Rob Law is going to re-invest realized profits to expand this business into new areas. This is also the most suitable mode of financing for this company since it ensures financial stability for this company in the future ((Ajami & Goddard 2006, p. 299).
- b) Reasons why other forms of financing are unsuitable
As mentioned, the most suitable option for financing that Rob can use to expand Trunki into new business areas is to re-invest realized profits. Currently, the company has a good profile and is able to acquire a loan from debt financing institutions. However, this will lead to a new obligation for this company to repay the loan and the interest charged on it. In case the company’s sales reduce in the future, the debt payment will lead to a reduced level of cash flow. In extreme cases, the company may be unable to repay the debt and interest rate. This may put the business’s survival at risk. In short, debt financing will introduce a new financial risk which may adversely affect the company in the future. Additionally, debt financing will lead to an additional cost associated with interest charged on loan (Ajami & Goddard 2006, p. 302).
- a) Marketing strategies that have been employed
Magmatic Ltd. uses public relations as the main marketing strategy. According to Smarta, (2012) Magmatic’s strategy involves arranging meetings with journalists and then taking that opportunity to wow them with the products. The journalists then relay information about the company and its products to the public through various kinds of media (Bourret, 2012). Law has also been interviewed severally in various kinds of media and this has played a huge role in raising the awareness of the product to potential consumers, retailers, and distributors. Apart from this, Trunki is increasingly being advertised through the internet, in social media. Lately, Magmatic produced a ‘Night at the Museum-style viral’ video to coincide with a new dinosaur product, which is available on YouTube. The company also has FaceBook profiles which are updated regularly to keep the public always informed about its activities. Law explains that social media has greatly raised the awareness of Trunki internationally and has been an interactive way of engaging with customers. ‘Word of mouth’ has also been an effective strategy employed by this enterprise (Bourret, 2012).
- b) Ways in which these marketing strategies can be improved
There are various ways in which this company can improve its marketing strategies for the Trunki brand. The public relations strategy that is currently capitalized on largely focuses on awareness of Trunki brand to potential consumers, retailers, and distributors. The awareness campaign can be strengthened by active advertisements through various kinds of media such as newspapers, Televisions, and Newspapers (Shimp, 2008, p. 7). Additionally, the company may produce a video and give it freely to airlines to be aired during travel. There is also a need for greater engagement in social media through the use of additional social sites such as Twiter and Fun space. It is also important to consider adding new features or services to make the products more appealing to consumers.
- c) The Unique Selling Points offered by this business
One of the unique features of Trunki is that though the suitcases resemble toys or luggage, they may not be classified as either. A child can sit on the suitcase scoot along on it or ride on it as the parent pulls (Smarta, 2012). The purpose of these products makes them unique, which helps to reduce competition from toy and luggage producers. Further, after Trunki produced the first batch of products in 2006, Law injected light-hearted messages into promotional literature. For instance, he stated that “sounds like you had a poorly Trunki, but we’ve got a remedy” (Bourret 2012).The company also started placing instructional sheets on how to fix Trunki products, while law appeared on pictures accompanying such messages wearing a doctor’s outfit. Generally, these messages elicit a positive perception of Trunki by parents, bringing out the power of a conversational, fun approach (Bourret 2012).
- a) The opportunity for growth of Trunki
Trunki has grown tremendously in the last five years and is currently being sold in 95 countries in the world (Smarta, 2012). Trunki still has an opportunity to expand distribution channels into new, untapped markets in countries where it does not sell currently. Additionally, there is a need to explore untapped markets within countries where the product is available. Secondly, Trunki is currently produced in the United States, China and in the UK and the product is exported to other countries. As Ferrell & Hartline (2010, p. 21) explains, some consumers show a higher loyalty rate for domestically produced goods, compared to imported goods. The company has an opportunity to expand its production or outsource the production in other nations in which there is potential for market growth. Further, this company uses innovation in all aspects and this is the main driver for its successful performance. It has an opportunity to ensure global success in the future through continuous innovation and the introduction of more desirable products and services in the future (Ferrell & Hartline, 2010, p. 21).
- B) The most appropriate growth model for Trunki
The most appropriate growth model for Trunki is an organic model. This model involves expanding business and increasing turnover by sticking to the original growth strategy, rather than through acquisitions or mergers. An enterprise may increase sales in the existing markets or explore new markets in new geographical regions or use new sales or distribution channel, but still, stick to the original business model. This model adopts a natural growth, rather than forcing investment with outside growth. According to Korudi (2009, p. 75), this type of model is much safer to a small business enterprise than a rapid growth through acquisitions and mergers. This is because the enterprise applies a model that has been tried and tested.
The organic model gives a business enterprise the opportunity to try any new growth strategy before applying it or before moving into a new one (Korudi, 2009, p. 75). It is also easier on the finances of an organization since it avoids the need for outside investment. Specifically, an enterprise can grow naturally by re-investing profit back, thereby avoiding outside investments. As well, this growth model is most appropriate for a unique business such as Magmatic which may not easily find similar organizations to form mergers with or to acquire. Though organic growth usually takes longer compared to other growth models, it is the most suitable for Trunki. Magmatic can achieve organic growth by selling Trunki range of products in new geographical areas or in countries where the products are not available. It can also develop additional distributional channels in the old markets or sell new products or services to existing customers (Korudi, 2009, p. 76).
In conclusion, there are various issues that relate to the performance of the Trunki Brand. The issues examined in this section relate to the risks that the brand is exposed to, financing sources, marketing strategies and opportunities for growth. As examined, Trunki can be said to be a successful business venture with great potential for growth.
Ajami, R A & Goddard G J 2006 International Business: Theory and practice, M.E. Sharpe,
BBC 2009 “Dragon’s Den” Viewed 14, January 2013
Besley S & Brigham E F 2008 Principles of Finance, Cengage Learning, New York
Bourret C 2012 “Magmatic (Trunki): Rob Law MBE” Viewed 14, January 2013
Ferrell, O C & Hartline M D 2010 Marketing Strategy, Cengage Learning, New York
Kodi J 2009 Business Strategy: A guide to taking your business forward, John Wiley & Sons,
Shimp T A 2008 Advertising, Promotion, and Other Aspects of Integrated Marketing
Communications, Cengage Learning, New York
Smarta 2012 “Rob Law – Trunki” Viewed 14, January 2013,
Are you busy and do not have time to handle your assignment? Are you scared that your paper will not make the grade? Do you have responsibilities that may hinder you from turning in your assignment on time? Are you tired and can barely handle your assignment? Are your grades inconsistent?
Whichever your reason is, it is valid! You can get professional academic help from our service at affordable rates. We have a team of professional academic writers who can handle all your assignments.
- Plagiarism free papers
- Timely delivery
- Any deadline
- Skilled, Experienced Native English Writers
- Subject-relevant academic writer
- Adherence to paper instructions
- Ability to tackle bulk assignments
- Reasonable prices
- 24/7 Customer Support
- Get superb grades consistently
Online Academic Help With Different Subjects
Students barely have time to read. We got you! Have your literature essay or book review written without having the hassle of reading the book. You can get your literature paper custom-written for you by our literature specialists.
Do you struggle with finance? No need to torture yourself if finance is not your cup of tea. You can order your finance paper from our academic writing service and get 100% original work from competent finance experts.
While psychology may be an interesting subject, you may lack sufficient time to handle your assignments. Don’t despair; by using our academic writing service, you can be assured of perfect grades. Moreover, your grades will be consistent.
Engineering is quite a demanding subject. Students face a lot of pressure and barely have enough time to do what they love to do. Our academic writing service got you covered! Our engineering specialists follow the paper instructions and ensure timely delivery of the paper.
In the nursing course, you may have difficulties with literature reviews, annotated bibliographies, critical essays, and other assignments. Our nursing assignment writers will offer you professional nursing paper help at low prices.
Truth be told, sociology papers can be quite exhausting. Our academic writing service relieves you of fatigue, pressure, and stress. You can relax and have peace of mind as our academic writers handle your sociology assignment.
We take pride in having some of the best business writers in the industry. Our business writers have a lot of experience in the field. They are reliable, and you can be assured of a high-grade paper. They are able to handle business papers of any subject, length, deadline, and difficulty!
We boast of having some of the most experienced statistics experts in the industry. Our statistics experts have diverse skills, expertise, and knowledge to handle any kind of assignment. They have access to all kinds of software to get your assignment done.
Writing a law essay may prove to be an insurmountable obstacle, especially when you need to know the peculiarities of the legislative framework. Take advantage of our top-notch law specialists and get superb grades and 100% satisfaction.
What discipline/subjects do you deal in?
We have highlighted some of the most popular subjects we handle above. Those are just a tip of the iceberg. We deal in all academic disciplines since our writers are as diverse. They have been drawn from across all disciplines, and orders are assigned to those writers believed to be the best in the field. In a nutshell, there is no task we cannot handle; all you need to do is place your order with us. As long as your instructions are clear, just trust we shall deliver irrespective of the discipline.
Are your writers competent enough to handle my paper?
Our essay writers are graduates with bachelor's, masters, Ph.D., and doctorate degrees in various subjects. The minimum requirement to be an essay writer with our essay writing service is to have a college degree. All our academic writers have a minimum of two years of academic writing. We have a stringent recruitment process to ensure that we get only the most competent essay writers in the industry. We also ensure that the writers are handsomely compensated for their value. The majority of our writers are native English speakers. As such, the fluency of language and grammar is impeccable.
What if I don’t like the paper?
There is a very low likelihood that you won’t like the paper.
- When assigning your order, we match the paper’s discipline with the writer’s field/specialization. Since all our writers are graduates, we match the paper’s subject with the field the writer studied. For instance, if it’s a nursing paper, only a nursing graduate and writer will handle it. Furthermore, all our writers have academic writing experience and top-notch research skills.
- We have a quality assurance that reviews the paper before it gets to you. As such, we ensure that you get a paper that meets the required standard and will most definitely make the grade.
In the event that you don’t like your paper:
- The writer will revise the paper up to your pleasing. You have unlimited revisions. You simply need to highlight what specifically you don’t like about the paper, and the writer will make the amendments. The paper will be revised until you are satisfied. Revisions are free of charge
- We will have a different writer write the paper from scratch.
- Last resort, if the above does not work, we will refund your money.
Will the professor find out I didn’t write the paper myself?
Not at all. All papers are written from scratch. There is no way your tutor or instructor will realize that you did not write the paper yourself. In fact, we recommend using our assignment help services for consistent results.
What if the paper is plagiarized?
We check all papers for plagiarism before we submit them. We use powerful plagiarism checking software such as SafeAssign, LopesWrite, and Turnitin. We also upload the plagiarism report so that you can review it. We understand that plagiarism is academic suicide. We would not take the risk of submitting plagiarized work and jeopardize your academic journey. Furthermore, we do not sell or use prewritten papers, and each paper is written from scratch.
When will I get my paper?
You determine when you get the paper by setting the deadline when placing the order. All papers are delivered within the deadline. We are well aware that we operate in a time-sensitive industry. As such, we have laid out strategies to ensure that the client receives the paper on time and they never miss the deadline. We understand that papers that are submitted late have some points deducted. We do not want you to miss any points due to late submission. We work on beating deadlines by huge margins in order to ensure that you have ample time to review the paper before you submit it.
Will anyone find out that I used your services?
We have a privacy and confidentiality policy that guides our work. We NEVER share any customer information with third parties. Noone will ever know that you used our assignment help services. It’s only between you and us. We are bound by our policies to protect the customer’s identity and information. All your information, such as your names, phone number, email, order information, and so on, are protected. We have robust security systems that ensure that your data is protected. Hacking our systems is close to impossible, and it has never happened.
How our Assignment Help Service Works
You fill all the paper instructions in the order form. Make sure you include all the helpful materials so that our academic writers can deliver the perfect paper. It will also help to eliminate unnecessary revisions.
2. Pay for the order
Proceed to pay for the paper so that it can be assigned to one of our expert academic writers. The paper subject is matched with the writer’s area of specialization.
3. Track the progress
You communicate with the writer and know about the progress of the paper. The client can ask the writer for drafts of the paper. The client can upload extra material and include additional instructions from the lecturer. Receive a paper.
4. Download the paper
The paper is sent to your email and uploaded to your personal account. You also get a plagiarism report attached to your paper.
PLACE THIS ORDER OR A SIMILAR ORDER WITH US TODAY AND GET A PERFECT SCORE!!!