Strategic Planning Report 2022

Strategic Planning 0
Strategic Planning
Student’s Name
8/22/2019

Strategic Planning 1
Introduction
Strategic planning is considered as an art that helps the companies in developing strategies,
evaluating them and analyzing their impact of organization objectives. It helps in providing
direction and achieves operational efficiency by aligning the functional activities with the
goals of the organization. Application of various strategic management tools will allow the
organizations to be more proactive towards the changing trends and opportunities that lie in
the business environment (Bryson, 2018). The additional paragraphs of the report will reflect
upon the application of various strategic management tools which includes Porter’s five
forces, SWOT analysis, and PESTLE analysis.
Porter’s Five Force Analysis
This model is considered as the most used model that describes the five important factors
which affect the functioning of the organizations. Application of this model will help the
companies in analyzing the strength of each force and analyze the firm’s competitive position
in the specific industry. This tool is important at the planning stage and also helps the
company in developing its competitive advantage over its competitors. Through the use of
this model the company can reduce and increase the price and can differentiate its products
from its competitors (Amrollahi, A. and Akhgar, 2013). It includes the following forces:
Bargaining power of buyers
It depicts the power of buyers to reduce the prices of products. It is analyzed that the
bargaining power of buyers is low because there is number of suppliers and the consumers
are price sensitive and quality conscious. However Zara is able to provide differentiated

Strategic Planning 2
products which in turn lower the power of the buyers to drive down the prices of the products
(Amrollahi, A. and Akhgar, 2013).
(Source: Amrollahi and Akhgar, 2013)
Bargaining power of suppliers
It depicts the power of supplier in increasing price. It is analyzed that the bargaining power of
suppliers is low because Zara has huge number of suppliers who deliver fairly standardized
products and the switching cost for Zara is low. This, in turn, decreases the power of the
supplier to increase the price of raw material. It is analyzed that Zara is considered as their
important customer of suppliers so the supplier provides the material at reasonable prices. It
weakens the force of suppliers and allows the company to attain higher profits (Jones and
Hill, 2010).