Model of Competitive Reality: Analysis and Strategies

Draw and discuss the model of competitive reality
The following is the model of competitive reality that Huon Aquaculture uses to forecast
behaviours of their leading competitors and strategize on ways of handling risks associated those
behaviours.
Feedback
1. Competitors Analysis
In order to succeed in both domestic and global markets, organizations must conduct a detailed
analysis of its key competitors. Currently, Huon Aquaculture has seven leading competitors
namely Tassal, Arnarlax, Petuna, Scottish Salmon, Leroy sea food, Cook Seafood and Marine
Harvest Companies (Blucher, 2015). The Market Cap ($M) for Huon Aquaculture Group
Limited (HUO) is 395 while that of the Tassal Group Limited (TGR), their leading competitor
stands at ($M) 845 (Investmart, 2019).
Competitor analysis
 Market
commonality
 Resource
similarity
Drivers of
competitive
behaviour
 Awareness
 Motivation
 Ability
Competitive rivalry
Likelihood of attack
 First-mover
benefits
 Organization
size
 Quality
Likelihood of response
 Type of
competitive
action
 Actor’s
reputation
 Market
dependence
Outcomes
 Market
position
 Final
performan
ce

1.1 Market Commonality
Huon Aquaculture has several competitors in its hatcheries, processing, feeding, nurseries,
harvesting and marine farming markets (Huon Aquaculture, 2019). This company operates in
four different markets but it mainly concentrates on hatcheries and processing. In 2018, due to
the increased volumes and enhanced pricing in the local market as well as gradually growing
strength in the international price, sales revenue for all its products was $317.9m, a figure that
marked a 23% increment from the previous accounting year (Huon Aquaculture Group
Limited, 2018). Even though it Tassal is the main competitor in hatcheries market, it is the
leading firm in marine farm and processing facilities adequately distributed in the Australian
market. In order to overtake Tassal in the hatcheries market, Huon Aquaculture need put into
place more sophisticated marketing mechanisms including hiring experts to aid in their
marketing undertakings.
1.1 Resource Similarity
As at 2018, Huon Aquaculture’s current assets ($M) totalled to 223.0 while non-current assets
($M) amounted to about 300 both totalling to $523.0 million intangible assets (Huon
Aquaculture Group Limited, 2018). It is vital for Huon Aquaculture to evaluate the business
resources (both in types and amounts) owned by Tassal and other leading competitors since
companies with comparable business assets tend to have comparable strengths and weaknesses
and in most cases apply similar strategies.
2. Drivers of Competitive Behaviour
The competitive behaviour of Huon Aquaculture’s is influenced by its market commonalities as
well as resource similarities. Competitive behaviour is driven by three main drivers namely,

ability, motivation, and awareness. These three factors affect strategies and course of actions
taken by Huon Aquaculture Company while participating in market competitive rivalry (CHEN,
et al., 2007).
Awareness is the degree to which competing companies recognize the extent of their shared
interdependence which results from market commonality and resource similarity (Hoskisson,
2013). It is true that if there is more resource similarity and market commonality, then there is a
high degree of awareness about competitor actions and responses. Motivation on the other hand
concerns the company’s incentive to take a given course of action or react to a rival’s attack and
relates to perceived losses and gains. Any action taken by Tassal Company will directly affect
Huon Aquaculture’s market and the level of competition between the two corporations is bound
to increase. Actions from other minor competitors may not affect Huon Aquaculture and
therefore it might not be motivated to engage in any rivalry with them. Ability, on the other
hand, relates to every corporation’s resources and the flexibility they provide. Without enough
resources Huon Aquaculture may lack the ability to attack their competitors and/or respond to
their actions.
3. Competitive Rivalry
As noted in the preceding sections, Huon Aquaculture Company has several competing firms in
the marketplace though it holds a significant market share as well. In order to enhance forecasts
regarding competitors’ responses and actions, management at Huon Aquaculture is needed to
evaluate both “Likelihood of Attack” factors and “likelihood of Response” factors.
3.1 Likelihood of Attack