Enterprise Rent a Car free essay sample

The first market was the replacement market that targeted towards local customers in the Enterprise neighbourhood locations who needed rental cars as replacements while their cars were being serviced. Enterprise employees would often visit the referral sources such as the insurance agents and auto mechanics with gifts, thereby establishing a personal relationship between the local Enterprise branch and the referral source. Creating this environment of good will encouraged agents and body shop workers to continue to recommend Enterprise over other companies. Additionally, Enterprise rental rates were lower then rates of comparable rental companies due to location of its branch offices. Contrary to the normal practice, Enterprise had locations in the city and suburban areas instead of locating close to the airport. Although this may at first seem counterproductive, having these locations actually aided Enterprise substantially. The cost of property near the airport was much higher then property in more localized city areas. We will write a custom essay sample on Enterprise Rent a Car or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page Enterprise would pass the savings from property and rent onto the customer, and was therefore able to offer lower rates with comparable or greater service. Careful maintenance of the rental cars allowed Enterprise to keep its rental cars for longer then standard for airport rental companies. The low turnover rate of vehicles generated savings for Enterprise, which was then passed to the customer in the form of lower rates. By running efficient operations with an emphasis on the personal relationships between businesses, Enterprise was able to differentiate itself from a crowded market as well as capture a large customer base previously untapped by airport rental companies. Another market that Enterprise was able to tap into was the â€Å"discretionary† or â€Å"leisure/vacation† sector. Many customers began renting cars for vacation purposes, whether it be a visiting relative or friend who required a vehicle, or a family who would rent a car for use instead of the family car. Local branches aided enormously in this area, making the process of renting a car a quick and convenient process. Finally, an important aspect of Enterprise’s business was the local corporate market. They began to offer vehicles to businesses. Economically, renting a vehicle for occasional use made more sense then owning and maintaining the same vehicle for a business. In this way Enterprise was able to offer entire fleets to business at lower cost, resulting in a win-win situation for both parties. In the same way, collages and universities turned to Enterprise for rental of large vehicles for functions such as sports teams or trips. By focusing on providing excellent customer service at low cost, Enterprise grew by its referral sources and word of mouth advertising. Enterprise became known for these qualities for business requiring rental car services. However, Enterprise now faces the challenge to grow against the fierce competition without losing its focus and corporate culture. -0 SITUATIONAL ANALYSIS The situation Enterprise faces is not uncommon in the business industry. None the less, it is important to understand the needs of the company and tailor a specific strategy towards it. Currently, Enterprise has two main customer bases: the individual customer, and business/organizations. The individual customer can be categorized based on their particular need: rental during automobile repair or for leisure/vacation. The people in both of these categories, although renting for different needs, will share many common characteristics. These customers value both low cost and excellent customer service. Providing both generates both branch loyalty and advertisement through word of mouth. On the other hand, business require the same service but on a much larger scale. Cost is the primary factor in the decision to outsource their entire transportation to a rental company. In this situation, businesses seek excellent service that integrates with their own operation successfully as well. By providing this service without disrupting their business dealings, companies are able to lower their costs by eliminating the ownership and maintenance costs of their own vehicles. Lack of brand awareness by public who have never used this type of service before †¢Inability to attract qualified college graduates †¢Lack of awareness about pick up service and localized offices †¢Lack of advertising resulting in reliance on word-of-mouth referral sources OPPORTUNITIES †¢Opportunity to fuel growth by attracting highly qualified college graduates †¢Addititional markets to tap in the car-rental business †¢Growing car rental market †¢Main market segment (replacement market) growing Strong financial base provides opportunities to expand business THREATS †¢Lack of brand image resulting in lower college graduate applicants and consumers †¢Increasing competition in home-city market from other companies †¢Negative image about working for a car rental company †¢Low brand awareness resulting in lower consumers/customer loyalty 2-2 CUSTOMER ANALYSIS Presently, Enterprise relies on its word of mouth advertising and excelle nt customer service for a large part of its business, with its target consumer as those who need a rental car for work, leisure, and repair.