Industry Overview

Industry Overview

INDUSTRY OVERVIEW
As a student of LaGuardia Community college I really like to study this company I went to many places to acquire information about this company and I also read a book .here is an industry overview of Steinway and sons.
Steinway and Sons was established in New York City in 1853 by Henry Engelhard Steinway, an immigrant from Germany.   The business excelled because of it technical brilliance and shortly, a year later, the company won a gold medal at the Metropolitan Fair in Washington D.C. The following year, Steinway and Sons introduced the cross-stringing technique in a piano with a cast iron frame, an innovation that is now universal in all grand pianos.   Due to the company’s innovative ability and technical supremacy, orders grew rapidly and a new larger factory was constructed in 1860.   For the next 140 years, Steinway and Sons would be recognized as the leader in the market for high quality pianos (Gourville).
Over the past the early 90,s, Steinway and Sons had somewhat tumultuous.   After 120 years of being a closely held family operation, it was decided Steinway and Sons could no longer survive in this manner.   The company was sold to the CBS Musical Instruments Division in 1972 for $21 million worth of CBS stock. The primary reasoning for the sale was associated with finances which hadn’t changed in the following few years; the company’s return on capital was only about 5% (Gourville).
In the beginning, CBS invested several million dollars in the first few years after purchasing the company.   This may not seem like an exceptionally large amount; however the Steinway family had never before invested more than $150,000 per year in capital improvements.   In addition, to ease the transition and to ensure quality focus, CBS employed Henry Steinway as president of Steinway and Sons for five (Gourville).
Looking for a reasonable return on investment, CBS wanted to increase revenue and decrease manufacturing costs by increasing production....