...February 25, 2010 Assignment 2 Porter’s Six Forces Analysis General Retail: Merchandise/Department Stores Prepared by: Yulia Petukhova ID# A30 The department store industry will be analyzed taking department stores as players, individual consumers as buyers, and manufacturers and distributors as the key suppliers. The Rivalry among existing firms High The period from the end of the 20th century up until now has been marked by the consolidation trend in the department store industry, characterized by major acquisitions by a few larger, powerful competitors, greatly intensifying the rivalry among them.9, 13 Since there are only a few of them in the industry, they tend to match each other’s steps in some way or another. After JC Penny introduced itself to Manhattan just a block away from Macy’s, it is only a matter of short time before Kohl’s will finally announce its move into Manhattan as well.10 Slowdown in the industry growth coupled with reduced consumer spending and low switching costs intensifies rivalry even further prompting the market players to differentiate their products by introducing exclusive brands and increasing innovation.3, 15, 17, 19, JC Penny contracted Cindy Crawford to extend her jewelry brand exclusively at their stores, while Macy’s has signed a strategic alliance agreement to become an exclusive retailer of Ellen Tracy branded women’s sportswear in spring 2010...
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...achieve their goal. As more firms enter the market and as technology changes and grow in affects a firm capability of having or maintain competitive advantage, so firms need to have full awareness of what is happening in the external environment. 2. Define and describe the general environment and the industry environment. The general environment could be considered as the outer layer that is widely dispersed and affects organizations indirectly. The general environment is a group of seven environmental segments (demographic, economic, political/legal, sociocultural, technological, global, and physical) which influence an industry and the firms within it. A firm does not directly control the general environment, but by all means firm’s actions are influence by the segments. The industry environment directly influences a firm and its competitive actions and response. A firm response and competitive actions may be influenced by these set of factors: the threat of new entrants, the power of suppliers, the power of buyers, the threat of product substitutes, and the intensity of rivalry among competitors. 3. Discuss the four activities of the external environment analysis process. The External Analysis examines opportunities and threats that exist in the environment. Both opportunities and threats exist independently of the firm. Firms engage in external...
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...Industry Analysis (Case 1) Paper Instructions and Grade Sheet MAN 4720 Strategic Management Assignment Value - 50 points possible (all team members receive the same grade) Due Date: See syllabus Purpose: Each team will select an industry to study. You will conduct an industry analysis (also called a competitive analysis) of your assigned industry, and to collectively write a paper reporting your results. This paper will require that you apply the concepts that you have learned in the course. This assignment will enable you to learn how to research and analyze the external and competitive nature of an industry. It is necessary to have a thorough understanding of an industry before a firm can develop strategic plans to obtain competitive advantages. Basic Attributes of Your Report: The best reports are the result of a lot of research. There is a direct correlation between research and grades. To earn the highest grade possible, your report should demonstrate evidence of: • Significant secondary research. • Integration of course concepts. • Written in plain English and demonstrating understanding that clarifies and distills the problems and opportunities competitors in the industry are facing. • Precise business writing skills. (You will be penalized for writing mistakes.) The best reports also summarize what you have learned from your research. A great report demonstrates that the student has thoroughly researched the industry,...
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...-Major Case Analysis Methodology A. Non Diversified Company 1. Executive Summary: (5%) A brief description of the major strategic issue(s) the company is facing, the reasons why the company should resolve this (these) issue(s) and your recommendation. The length should not exceed one page. This is usually written after you have completed your case analysis. 2. The Analysis of present situation: (10%) a. Identify the present mission/vision of the company. If it is not given in the case use company’s web site b. What are the strategic objectives of the company c. What is the present strategic direction of the company? What strategies are being followed? How successful is the company in achieving these objectives d. Do you think that there is alignment between present strategy, structure, and culture? Why/ Why not e. What core competencies does this company possess? Why do you think that these are core competencies? Any distinctive competence? 3. Industry Analysis:.( 25%) a. Analyze the general environment faced by the industry b. What are the strategic groups present in the industry. What are their characteristics. What is the nature of competition within each strategic groups and between the strategic groups c. Using Porter’s five forces model is the industry attractive. Please note that in the main body of the report you should discuss each of these forces giving overall reasons for each force being attractive or not, The detailed...
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...which assumptions they are based upon; * complete, i.e. they do not omit important components; * correct, i.e. the answer addresses the task set in the question and the answer contains no errors; and * well written, i.e. the answers are appropriately structured, clearly expressed and grammatically correct. You should use additional references to the reading provided so far in the unit. The reference list does not count towards the word limit. On iLearn you can find the Aldi case. This assignment, as well as the group assignment, is based on this case. It is also advisable to consult the marking criteria on iLearn. Question 1 The information in the case (Aldi) is not sufficient for making an informed and complete industry analysis based on Porter’s...
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...of sustainability report of the Fine dining industry in Aruba describes the challenging landscape of the local and international fine dining industry. An Economic industry analysis using Porters five forces analysis on sustainability in the fine dining industry is provided and data analysis of the conducted surveys. For this report a combination of qualitative and quantitative research was used. The data collection was based on interviews held with managers and owners of the restaurants and analysis of the survey, literature review and desk research. March 4, 2015 2 Table of Contents Executive summary......................................................................................................................... 2 1. Introduction ............................................................................................................................. 4 2. The changing landscape and challenging market space of the international fine dining industry. .......................................................................................................................................... 5 3. Economic and industry analysis .............................................................................................. 6 3.1. Industry analysis by Porter’s Five Forces Model ................................................................ 6 3.2. Managing their environment ....................................................................
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...Knowledge Resource Centre KNOWLEDGE FINDER BACK TO KNOWLEDGE HOMEPAGE ------------------------------------------------- Top of Form Bottom of Form KNOWLEDGE FINDER BACK TO KNOWLEDGE HOMEPAGE PRINT VERSION SEND TO A FRIEND Management Tools Porter's Five Forces and Profitability M.E. Porter, "How Competitive Forces Shape Strategy", Harvard Business Review, 1980. This diagram has been recreated by LMC. LMC explains Porter's Five Forces and Profitability A business strategy tool designed to analyse a strategic business unit and its relationship with and competition within the industry. Using five key areas affecting profitability, the results give a company insight into its industry attractiveness. The five forces are identified as: bargaining power of suppliers, bargaining power of buyers, threat of new entrants, threats from substitute products and competitive rivalry. Each force is analysed in terms of whether it will produce higher or lower profitability if its effects are felt. 1. Bargaining power of suppliers This will be high or strong where there are relatively few individuals holding the power, where the costs of changing suppliers are high, or if the supplier has a strong brand. 2. Bargaining power of buyers This will be strong where market share is controlled by few buyers, for example large supermarket chains in the groceries market, or if the costs of switching supplier are low. 3. Threat of new entrants There can be various barriers...
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...Introduction This paper shall involve and include a discussion and analysis of the macro environment of business using the extended PESTLE tool and an analysis of the micro environment in which the business operates by use of the Porters Five Forces Model as a tool. From the analysis of the micro environment of the business, one trend and one crisis will be identified and there will include a short strategy in which the business can address each of these issues. In this case, the situation surrounding Spur Steak Ranches shall be taken into consideration. About the business Spur Steak Ranches is a steakhouse franchise restaurant chain originating from South Africa. Its menu mainly features beef burgers, steaks and ribs, along with salads, chicken, seafood and vegetarian options. The company was founded by Allen Ambor in 1967, when he opened the Golden Spur in Newlands, Cape Town P²E²STLE Analysis on Micro Environment Political The operations of Spur Steak Ranches are highly influences by the laws and policies in traduces and enforced by the government of South Africa. Regarding restaurants in South Africa, health legislations are enforced to ensure that the premises and equipment of restaurants are of the correct health and hygiene standards. In the case of restaurants in South Africa, a license from the local health department is commonly required to operate and proceed in such a venture. The government of South Africa controls the license given for the opening...
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...Assignment A – Northern Rush Date: Oct 2, 2015 To: Mr. Murray James and his partners From: External Consulting Group Subject: Macro and Micro Analysis of Northern Rush Thank you for allowing us the opportunity to work with your company. As requested, we have evaluated the your business plan using PESTE and Porter’s five forces in order to give you a deeper understanding of the industry your company will be working in. We take a strategic and marketing view in this analysis and we will be following this up with a more accounting and finance focused analysis of your company. From our research, we would like to highlight the following conclusions: 1. The strategy of Northern Rush should be cost leadership. 2. There exists a substantial amount of competition in this industry. 3. Northern Rush has a unique advantage due to its marketing strategy and social benefits. The remaining of this memo will make a complete analysis of PESTE and porter’s five forces, their effect on Northern Rush, and the key factors that will lead to Northern Rush’s success. PESTE There are no significant political or environmental issues that affect Northern Rush. Economic: * The Canadian market for home furnishing has recovered more quickly than their US counterpart. * The recent reduction in oil prices has lowered delivery costs for firms. * The cost of borrowing is low if Northern Rush decides to seek external financing. * The home furnishing industry...
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...Application of Porter’s Five Forces Model on Tata NANO Brand Name: Unit Name Unit Code Tutor School Date Introduction The turnover in automotive industry is growing significantly. Companies need to sell their product across borders. To realize this, companies must evaluate the market forces in target markets in order to increase sales. One strategic tool used in evaluating market forces is porters five forces model. This tool highlights the key factors that determine the industry competition and the viability of such a market. The porters five forces model has been evolving with time. The principle ‘’the state of competition in an industry depends on five basic forces’’ (Porter, 2008 P.3) is still relevant. This analysis model covers a wide range of factors affecting the industry. Companies with awareness about their environment are able to make strategic decisions concerning their business. This paper discuses the application of Michael porter’s five forces model by Tata Motors Company on their new product, Tata Nano. Tata motors are the largest automobile company in India with revenues in excess of USD 16 billion in 2011. Tata motors have subsidiary companies and associate companies involved in various industries including mining, oil, manufacturing, and telecommunications. Tata motors have operations in Spain, Korea, Thailand, UK, and South Korea. The paper begins by identifying porters five forces. Second, a brief history of...
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...UMUC Haircuts Stage One Wesley Mantlo University Maryland University College Information Systems in Organizations (IFSM 300) UMUC Haircuts Stage One This report is based on gaining intellectual technology knowledge from a business standpoint. The Porters 5 Forces Analysis will be used as the beginning stage into this continuing project. UMUC Haircuts will be used as the background story to gain real world experience through creating solutions around Porters 5 Forces Analysis. This report is written in stages with gradual information given as is required. Stage II, minimally explains the forces, how they are relevant to the UMUC Haircuts, Impact and whether or not it will impact the strategy. Porters Five Forces are: Buyer Power, Supplier Power, Threat of Substitute Products or Services, Threat of New Entrants, and Rivalry among Existing Competitors. Buyer Power is the force that the buyer has on a product. UMUC Haircuts will want to bring in the most amounts of customers to gain the financial footstep in the Haircut industry. This is a positive impact and can affect the strategy. Supplier Power is big in the Haircut industry, especially as it pertains to personal hygiene. This is a positive impact and will affect the strategy. The threat of Substitutes in this industry is high with a neutral impact and does not affect the strategy. Generally, people who cut other peoples hair are personal friends or a fad and there is always months of opportunities where...
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...deciding whether to switch career and become a farmer – he's always loved the countryside, and wants to switch to a career where he's his own boss. He creates the following Five Forces Analysis as he thinks the situation through: Figure 2 - Porter's Five Forces Example - Buying a Farm This worries him: The threat of new entry is quite high: if anyone looks as if they're making a sustained profit, new competitors can come into the industry easily, reducing profits. Competitive rivalry is extremely high: if someone raises prices, they'll be quickly undercut. Intense competition puts strong downward pressure on prices. Buyer Power is strong, again implying strong downward pressure on prices. There is some threat of substitution. Unless he is able to find some way of changing this situation, this looks like a very tough industry to survive in. Maybe he'll need to specialize in a sector of the market that's protected from some of these forces, or find a related business that's in a stronger position. Key Points: Porter's Five Forces Analysis is an important tool for assessing the potential for profitability in an industry. With a little adaptation, it is also useful as a way of assessing the balance of power in more general situations. It works by looking at the strength of five important forces that affect competition: Supplier Power: The power of suppliers to drive up the prices of your inputs. Buyer Power: The power of your customers to drive down your prices. Competitive...
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... 2010). For example working practices may need updating to gain efficiencies, staff skills may need improving, customer service response times could be shortened, customers demanding a product or service you do not currently provide, new technology may produce improvements in efficiency, costs could be reduced, innovative new products may be possible to increase revenues and profit. This is by no means an exhaustive list these areas and many others should be reviewed on a regular basis to identify opportunities for change and innovation. A starting point in this process is to analyse the organisations current situation. Management literature (Thompson et al. 2010) suggests a good place to start to assess the need for change is the SWOT analysis framework (Figure 1). Analysing the organisations...
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...Case study on | Strategic Analysis | Of Dell Inc. | | mujeeb | [Pick the date] | | Introduction: The purpose of this report is to analyze the strategic position of Dell Inc. Headquarter in Round Rock, Texas; Dell computer was founded in 1984 by Michael Dell who was then an undergraduate student at the University of Texas. From very inception the company is providing superior value to its target market by providing latest technology at competitive prices around the world. Dell is cited as the largest player of the personal computer market. The company follows unique selling policy that is known as Dell Model—selling computers and other equipments directly to customer and build-to-order strategy thereby eliminating the intermediary margins and inventory costs. The mission statement of Dell has been divided into three parts customer satisfaction that states “We are an established company striving to satisfy customers by meeting their demands of quality, responsiveness, and competitive pricing. Each customer is #1” , team satisfaction that states, “Management and employees are committed to cooperating as a team for the purpose of profitability and gratification of a job well done” and community satisfaction “We will provide jobs in a clean, safe, environmentally sound atmosphere and be an active participant in community affairs” (Dell, 2010). 1. External Analysis: The primary industry of Dell is personal computer and computer equipments that are evolving...
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...environmental degradation through creating an online platform for the exchange, sharing and recycling of used goods among its online users. Due to the unique concept of the organization, conventional business models may not be applicable for “re-use- UK” and thus, in the first part of this report an attempt has been made to develop an appropriate business model for them. The focal point of which is the key partnerships that “re-use –UK” must form. As per the assessment requirement, in depth strategic analysis of “re-use UK” has been conducted using PEST analysis and Porters five forces. A critical assessment of the major emerging technological trends that are shaping the dynamics of the start-up’s industry is also included in the report. Since, the start-up plans to operate through the internet, a major portion of this report focuses on the development of a suitable IS strategy for “re -use UK” using the results of the strategic analysis and technological trend analysis as inputs. This section includes a detailed account of the major components of the potential IS strategy, along with information regarding its management. Finally, the...
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