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Business Analysis for Accountants
IntroductionIn this present paper, we will discuss the current strategic position analysis of Imperial tobaccogroup plc which are the multinational tobacco company and it headquarter is located in Bristol,the United Kingdom. The paper also describes the analysis of current strategies, currentchallenges faced by the company in operating, an impact of challenges to the organization andthe resources and competencies of the company may provide new opportunities to theorganization. The company has ranked world’s fourth largest international cigarette company byits market share. The company serves across worldwide, and it is the public limited company thathas approximately 36,400 employees (Imperialbrandsplc.com et al., 2017).Current strategic positionThe strategic position analysis plays an important role in determining the impact of strategies onthe profitability of the business within the particular period of time. There are several areaswhich need to be assessed in order to evaluate the strategic position of the company. Followingare the analysis of business areas:1.Product performanceThe current performance of the products is meeting the expectations of the consumers, andthe company is successfully providing the innovative product and services to its targetaudience.2.Core competencies
The core competencies of the company include wide distribution channel, superior brandbuilding capabilities, acknowledge service skills and effective supply chain managementwhich help to provide a competitive advantage to the company (Strategy et al.,2013) .3.Resource allocationThe physical resource is available in abundance in the operating locations of the company.There are various sources of innovation such as e-choupal which provides intangible benefitsto the company.4.Competitive and market pressureThere are various external factors which impact on the strategic position of the company suchas a change in the government regulation, change in the need and demands of consumers,innovative products provided by the consumers.The Imperial tobacco group was initiated in 1901 by the merger of thirteen British companies inorder to minimize the competition among the competitors within the same industry. Thecompany is diversified into restaurants, financial services, and electronics (Branston et al., 2014).Following are the SWOT analysis of the company:1.StrengthThe strength of the company includes existing distribution channel and sales networkwhich helps to provide a competitive advantage to the company. It helps to increase thesales volume of the company by reaching to the maximum target consumers. Thecompany lies in the tobacco industry which has a large number of entry barrier due towhich there is the limited number of competitors within the same industry. The companyhas the high quality of products and services in order to satisfy the needs and demands of
the consumers. The company has excellent research and development facilities whichhelp to provide innovative products to its customers.2.WeaknessThe diversification in the various business segments is risky for the company. The steepincrease in the taxation of cigarette has direct impacts on the revenue of the company.The hotel industry has not big share in the market.3.OpportunityThere are various markets which are untapped by the company in the retail garment,cigarettes, packaging and agricultural products. The company can achieve high growthpotential which helps to generate higher profit within the specific period of time. Theeffective marketing and promotional activities can help to generate higher profits throughbuilding the brand image in the eyes of the customers.4.ThreatThe negative publicity regarding the smoking may impact on the revenue generation ofthe company. The government policies regarding the banning of tobacco products canadversely impact on the profitability of the company (Naik et al., 2015).Following is the PESTLE analysis of the company:1.Political factorsThe political environment of the company is favorable because the government hasremoved expenditure tax in the year 2007-08 and the service tax assumptionexemption is budgeted in the year 2008-09. The tax policies have increased the exciseduty in the cigarettes assumption which impacts on the overall sales of the company.