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The Vermont Teddy Bear Company Story

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Vermont Teddy Bear Company

The Vermont Teddy Bear Company Story:

In 1981, John Sortino was playing with his son Graham and his collection of teddy bears, each one of those was wearing a tag identifying it, as a foreign made. Surprised to see it, Sortino was inspired to bring the American tradition to its roots by handcrafting bears right there. His first bears, Bearcho, Buffy, Bearazar, and Fuzzy Wuzzy, were made in his wife's sewing room and sold mostly to friends. By 1983, Sortino began to sell his bears at an open-air market at Burlington, Vermont. It took four days to sell his first bear.

One day, a customer gave him a terrific idea. A tourist visiting Burlington, wanted a bear, but she wanted it to be mailed to her home. That gave Sortino the idea to package a teddy bear and add delivery service and other extras to go along with. The Bear-Gram concept was born.

Shortly before Valentine's Day in 1990, the company took its Bear-Gram concept and unusual marketing strategy to New York City. Advertisements featuring a well-known local radio personalities endorsing Bear-Gram gifts were placed on well-known New York City radio station. The response was immediate and overwhelming. Calls for Bear-Grams flooded the company's three telephone lines and within the first two days, the company reached its sales goal for the entire year. Sales and success followed the company as it grew from its lowly beginnings to become a major competitor in the direct response gift delivery business.


The Vermont Teddy Bear Company is the leading maker of hand-made, American teddy bears. By offering its customers a creative alternative to flowers through its Bear-Gram gift delivery service, the Vermont Teddy Bear company is gaining an ever-growing share of the $15 billion gift delivery industry. Well positioned with a firm balance sheet to pursue an aggressive growth industry, the company has been growing at an impressive rate. Roughly, 55% of the received by the company orders were made by means of internet website Each of the teddy bears sent by the company is personalized with a card and a candy treats. The Vermont Teddy Bear Company helps people connect in fun, personal and meaningful way.

Opportunities in Foreign Markets: SWOT Analysis

Until now, the company has only been selling to American customers. However, the management is exploring some opportunities in other parts of the world because Vermont Teddy Bear Company is a company with a great potential, which is yet not realised. The company is already one of the most popular gift delivery service companies in United States but to go abroad Vermont Teddy Bear needs to increase its strengths and decrease its weaknesses. To do that, Vermont Teddy Bear Company needs to focus on the findings of external and internal review of the company, which draws attention to the critical organizational strengths and weaknesses, as well as its opportunities and threats with the help of SWOT Analysis. In my point of view, the company has three important strengths such as its well known in United States name, good reputation, qualitative products, variety of products and "Made in America" trademark. Those strengths make a good impression for the company and open a way to explore foreign markets. At the same time, the Vermont Teddy Bear Company has some weaknesses, which slow down the company's willingness to sell its products abroad. One of the greatest weaknesses of the company is its seasonal sales. The company's Bear Gram segment sales are heavily seasonal and dependable on holidays. Holidays such as Valentine's Day, Christmas, and Mother's Day are the largest sales seasons. Such a seasonal sales causes employees, company business politics and sales to alter from season to season. Another visual weakness of the company is, that it more than 50% of its products are outsourced to overseas manufacturers, mainly in Asia, what no longer differentiates Vermont Teddy Bear Company from other companies, which produce gifts. Before, Vermont Teddy Bear used to produce their teddies in United States using only American raw materials, what made them different from other companies, which were subcontracting low-cost manufacturers in other countries and "Made in America" trademark brought the company an additional good image.

One of the opportunities to decrease the weaknesses of the company would be to continue make a distinction between Vermont Teddy Bear Company and other competitors by the means of producing a purely American Teddy Bear. The Vermont Teddy Bear Company has threats like competitors and overloaded with teddy bears and gift producing companies market. Moreover, as we all know, competition does not leave the companies space to grow.

German Market versus European and Asian Markets:

In my point of view, European or particularly German Market is much more attractive for Vermont Teddy Bear Company than Asian market because culturally and traditionally European people are more closely familiar with teddy bears and are more likely to buy them than people from Asia. As well, most of the competitors mentioned in the text serve in European market, what means, that there are more capabilities for teddy bears. Simply traditionally European citizens like teddy bears and have been buying them as a gifts for a ages, not really like Asian, because Asian culture itself is totally different from European. Although, on the other hand, it would be easier to enter Asian market because of lack of competition and a first mover advantage, but in that case, Vermont Teddy Bear Company has to take into consideration that the sales are likely to be lower in Asian countries than in European because of cultural differences; and has to think whever the company wants to concentrate on high turnover on not.

The company should enter foreign market using the same strategy for the similar countries (e.g. to enter European market they will use one strategy because customers of European countries tend to have more or less similar preferences). By entering foreign markets they should concentrate on global strategy and global strategy suggest not to differentiate the products for different countries to satisfy customers needs in each country but to customize its products.

At the same time, Vermont Teddy Bear Company should try to expand its selling possibilities from Internet to wholesaler or its own shops. If we take for example, Europe people there are more likely to buy the products in the shops than over the Internet. In addition to that, I think, that is better to introduce a new products in the shops



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