Impact of Macro and Micro Environment on Strategic Management Plan of ASOS

This report discusses the impact of macro and micro environment on the strategic management plan of ASOS. It covers the SWOT analysis of strategic management decision-making process, assessment of the competitive environment using Porter’s Five Forces model, and industry's possible competitive benefits.

unit 32

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
Part1.................................................................................................................................................3
Impact of macro environment in business strategy development................................................3
SWOT analysis of strategic management decision- making process..........................................5
Micro environment factor impact business activity and their benefits for strategic plan............7
Assessment of the competitive environment using Porter’s Five Forces model.........................8
Industry's possible competitive benefits......................................................................................9
Policies objectives to reach overall strategic objectives............................................................10
Strategic direction......................................................................................................................10
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Strategic management plan refers to the term where organization manager develop
apply strategic methods. Models, analysis, research for growth and development. Small,
medium, large every type of organization has to follow strategic decision-making approach
because it influences new opportunities and also beneficial for survives in the competitive
market (Addae-Korankye and Aryee, 2021) ASOS is all above retail industry in UK. They
provide services like shoes, beauty products, accessories, shoes etc. Almost every
organization has to consider and follows new strategic approaches and analysis of internal
external forces which influence the overall business plan. On the basis of recent market trend
various company consider digital marketing strategy for their effective growth but the
management of strategic approaches require effective knowledge. This report clearly gives
idea about how company manage multiple aspects with the analysis and research of external
and internal forces and how it will affect the management strategy. Also, it manly gives idea
that knowledge of Porter five forces and strategic plan object develop efficiency in
organization.
MAIN BODY
Part1
Impact of macro environment in business strategy development
External forces influence the overall business strategy but when company wants them to
increase their business in international level, or they want to expand their business activity. The
have to know about external forces because analysis of this factors company can easily identify
and fruitful for strategy development (Alchammari, Ali and Alshammare, 2021). ASOS
company consider they mainly want to develop their business activities in international or global
level with effective manner. They also sales their services on international level, but they want to
consider new approaches, so they consider that which strategic approach can influence their
business activities in the large competitive market. Eternal forces impact on the strategic
management plan are ads followees,
Political:
Political factor influence their long term profitably, and diversification in the other
countries political system highly develop risk and it directly impacts on the product
transportation. Asos company services mainly influence by the product services and their supply

chain management provides into the other place. So analysis of this factor company consider that
they supply their goods according to the knowledge and analysis of political environment. So its
clear that when the company develops strategic approach with the analysis of this factor they
mainly consider transportation charges and according to charges they provide their services like
they increase their product shipment charges.
Economic:
Diversification in the government taxes policies are major challenging aspects of the
company services and business expansion. It directly impacts on the organization productivity
and profit because variations in the policies impacts on the individual quality of life, so many so
consumer wants to buy product and services but the higher tax charges directly impacts on the
business activities (Hadid and Al-Sayed, 2021). Solution and for strategic plan for this issue is
that company's analysis experts search and study on the other country taxes policy.
Social:
One of the major essential factor and almost every company has to consider this aspect
without knowledge of this factor organization not survives in the long term in market. Asos
company mainly provides services in clothes so on the basis of strategic plan they have to
focuses on the social cultural activities of different countries. They understand bout culture with
the utilization of social media they apply this approach and strategic plan that other countries
people which product like the most and their social beliefs and values knowledge can gives
proper idea for the strategic decision- making process for the company.
Technological:
On the basis of recent trend almost very organization development their activities with
the utilization of technological tools. Because innovation expansion makes the business quality
and productivity efficiently. If the any company wants to develop effective strategy for growth in
their business plan at global level, they have to follow and applies digital innovation in the
business because it helpful to reach new audience and attract more people with the product and
services (Jovanoska, Nechkoska and Mancheski, 2021). So effective expansion of the business
with new strategic manner its essential that company consider technology advancement for
productivity improvement. Also, technology factor influences the product offering in market
because new machines require large cost and development of new advance technology require

higher cost. According to this aspect company has to prepare for this that innovation is continues
process, so they save extra amount for technology advancement application.
Environment:
Environmental factor badly impacts on the strategic management plan and expansion of
decision-making process of the organization because economic factors are unwanted and
unknown situation which company not know about this factor that it comes in the future, and
they badly impact on the product and services. Every country has different environmental laws
and policies but ASOS company services influences by the climate changes because unwanted
weather and climate impacts the customer behaviour.
Legal:
Its essential when company enter the new market they evaluate and analyse the product
services they have to consider and follow the consumer protection and e-commerce which means
ASOS company not develop overall factory and stores in the other country they only provides
services via online and with the help of mediator, so they provide services in the other country
people. On the basis of this process company has to follow e-commerce activity because when
organization wants to develop their business in the other place they have to hire and approach
services providers are knowledgable and trustworthy.
SWOT analysis of strategic management decision- making process
Organization can easily analyse various factors and identify the company's
performance and activity with the application of SWOT analysis because it gives clear
about company's strength that which product is beneficial for company's strength, next one
is to identify the weaknesses which means it gives idea about weak points those are
influences the strategic decision of the management (Krasnostanova, and et.al., 2021). Next
one is the best and effective analysis approach which provides idea about new opportunities
and the last one is threat, so overall this analysis process can give effective idea about
company's productivity improvement are as follows,
Strength Weakness
 Their brand image in market.
 Innovation product display technique
on social media platform.
 Free shipping charge son product
services.
 So many people returned their

 Different and unique product so
people more attracts with their
services.
 Customer easily connects with the
product knowledge with the social
media pages, like they have websites,
Instagram, Facebook etc.
New strategy:
The company have to maintain their strength
for long time so its important that company
develop innovation tools and techniques and
develop effective strategy like they develop
efficiency and improvement in their services,
product of unique product, effective
communication with customer is the best way
to maintain strength of the company.
product to the company, so its
includes the additional shipping
charges.
New strategy:
Company has to focuses on some charges on
shipping ad some policies on the return
policy like they consider and applies like
without any problem people not return their
product if any damage or different goods
then it can be changes. So this policy and
strategic approach can beneficial for reduce
weaknesses.
Opportunity Threats
 On the basis of recent trend people
more focuses on unique quality of
product, and they mainly consider
fashion products.
 Impressive advertising technique son
mobile apps because it develops more
engagement and expand attraction
towards with the product (krátky, and
svidroňová, 2021) .
 Business expansion in different place
and joint new people for product
supply.
New strategy:
 Other multiple retail industry also
provides fashion product within the
lower prices, so the other multiple
retail companies are the biggest
threat.
 Uncertain changes in economic
government policies is major threat
for transportation services.
 The Biggest threats for the ASOS
retail industry like Marks & Spencer,
Tesco, new-look, Forever21 and
many more companies.
New strategy:

Unique product and impressive brand name
with good prices is the best way to develop
new opportunity, because customer highly
influence by the company who gives their
services on low price.
Time management in production process with
expansion of new designer for different
product productivity and effective digit
marketing concept strategy is helpful for to
reach attraction towards with the business.
Management can follow new strategy for the
product services higher new employee from
existing country because they have more
idea about how to communicate with
customer and their way of interaction can be
beneficial for reducing threats.
Also, they can reduce threats from the
analysis of economic condition, and then
they provide services according to
government tax.
Overall study from this analysis its clear that SWOT analysis is beneficial for the
maximizing profit and productivity and minimizing the challenges. It is mainly useful for the
identification of how company can prepare strategic management decision for global product and
services development (Mitchell, 2021).
Micro environment factor impact business activity and their benefits for strategic plan
Internal business activity management require knowledge of multiple aspect which means
human resource department, operation term work, marketing activities, product strength,
company growth, sales expert, stakeholders, buyers and many more.
Almost every organization faces challenges from them because their activity and work
behaviour highly impacts on the overall business strategic plan, but the management of effective
organization internal environment manager and owner can take decision and analysis or research
on the problems so that they can prepare new strategy on the basis of major problem which
influence the overall business activity (Mitra, 2021).
ASOS company has so many employees and every individual has their different way of
work behaviour, so it impacts on the overall supply chain management.
Variations in the customer choice and preference generate wastage and it generates
financial problems and various things influences when it happens. Development of strategic plan

for this aspect manger and analysis experts has to focuses on the that they analyse what customer
mainly require and expect from the organization product.
Assessment of the competitive environment using Porter’s Five Forces model
Porters fives forces is the most beneficial concept which provides clarity that which
product company's activities inference the profit generate and development of new opportunities.
But it mainly gives idea as well that how company can manage their various activities with the
analysis of these forces because each and every aspect of this model can gives clarity which
things are essential for the expansion of business productivity and development of new
opportunities (Panda, 2021). Evaluation of strategic management plan for new decision-making
process with the help of porter fives forces are as follows,
Threat of New Entrants:
New entrance of retail industry is one for the biggest threat for the multiple retail industry
because every individual organization when they develop their product they analyse multiple
aspects because they enter the new market, they more efficiently develop their services and
product into the market. ASOS company threat of new entrants is not much higher because the
business brand name is old and almost every UK people have knowledge about their
organization position. But they face issues from the new retail industry as well they influence by
the small retailer because they provide some product on lower cost. The Best resolution of the
new organization expansion is that company provides their survives with limited margin, fixed
cost and applies effective pricing strategy can beneficial for the long term.
Bargaining Power of Suppliers:
The company supplies power is higher because company require various range of raw
material and Supplier dominating nature influence the supply chain management of the company
(Rasila, 2021). Its essential that company develop strategic approach like they buy require raw
material with multiple retail and maintain good relationship with them is the best technique for
the reduction of supplier bargaining power. Also, when individual supplies develop argument
company consider and prepares design of the product without material.
Bargaining Power of Buyers:
Almost every company faces this particular challenge because it impacts on the overall
business result. The other company provide their services at lower prices and same product then

people attraction directly influences by this type of organization product. That's the reason every
company has to focuses on the product pricing decision and brands prices decision because its is
the only option to develop attraction of buyer, unique price, different design, quality, services
they all are the best technique to reduce bargaining power of buyers.
Threat from Substitute Products:
ASOS company threat of substitute is higher because multiple retail companies provides
services like cloths, shoes etc. So it influences and generate threat for the organization. So its
essential that company develop some unique things in their goods and services, or they improve
their quality of product. Substitute is the major thereat because customer and audience has
multiple options, and they more attract with the unique and good cost of product.
Rivalry among the existing players:
The company has so many existing rivalry because UK country has so many retail seller
who provides services into the market, Tesco, Mark and Spencer, Sainsbury and many more
companies provides same services in the market, but application of innovation techniques and
business expansion in different country improves their reputation and build powerful position.
On the basis of strategic decision company has to consider sustainable differentiation because
this is one of the best strategy which beneficial to services in the competitive market.
Industry's possible competitive benefits
Survives in the competitive market and grow business at international level requires
strategic approaches and its important that company develop analytical aspect to identify the
various factors are as follows,
Build effective culture:
Management of effective culture in the organization provides idea and generate
efficiency in individual performance (Wasliman, Hilman and Syauri, 2021). ASOS company
mainly consider that they develop smooth and powerful environment and promote team work
with the help of leader so individual performance and their motivation highly improve the
business culture as well and it improves the relationship within the sales and customer.
Clarify the strength:

Its important that company identify the individual strength, and they knowledge about
individual skills and knowledge when organization owner or strategic management planner has
great sense of individual work or external forces information then it develops proper strength.
Establish unique and different product:
Its essential that company mainly consider and develop strategy for unique product
development because it is the only option which influence the business at global level or in
existing market. Survives in the competitive market company has to follow new regulations and
approaches. On the basis of overall strategy can give powerful strategic management plan for
international business expansion of the company.
Policies objectives to reach overall strategic objectives
 Improvement in quality of business behaviour and work process. Because it develops
quality of business and creates new opportunities.
 Unique product strategy to reach attraction form the existing customer or new audience.
Different product policy can develop efficiency (Wirtz, Müller and Weyerer, 2021).
 Technological advancement and application of innovation tools is the most useful
technique and policies which improves the business work behaviour which means
adverting of product can be attractive and their website development highly influence the
sale.
 Effective transportation services build the attractiveness towards with the organization
services and it increases the people interest towards with product because every
individual when they want to buy any product they mainly consider that online product
comes on given time. So this activity is helpful for the new customer expansion.
 One and last is that when company prepares provide their survives in international level
for long term they analyse the external aspects of the other counties because it is the only
option which gives idea how product can survive in the market or not.
Strategic direction
Strategic direction is necessary in order to motivate the organisation to move ahead with all the
approaches that are in regard to bring aboard the essence of development. Development is a
common factor for every organisation and that can be attained with proper enthusiasm that every
organisation usually move ahead with. This is portrayed upon the strategic solution to all the
problems that arise in the organisation (Wasliman and et.al, 2021). The Ansoff growth matrix is

used to determine the product as well as its expansion to stop it will bring about an analysis
towards the strategies that will determine growth of the organisation as well as the business
forces. The Ansoff growth Matrix will explain about the business in four stages. They are as
follows:
Market penetration: the market penetration in this particular strategy is used to determine the
product in the existing market race. There are certain shapes that will determine the penetration
strategy which will help to execute number of waste that will fall in regard to decreasing prices
promotion as well as the distribution efforts that are the part of Marketplace.
Product development: the product development that is in regard to the organisation will help its
to move ahead with the development and expansion. With this product development strategy the
organisation has kept the head in innovative solutions and that is brought about by a research and
development. The organisation is also into investing for research and development processes
such that they can get to understand the existing market and the competitors that are in the race
(Rasila, 2021).
Market development: through market development strategy the organisation has acquired a grip
over the existing products. The expansion that is in regard to the geographic regions as well as
the customer segments is also known by the organisation. The assessment towards the profitable
standard and how far it can character different customers and segment them accordingly are
known. The consequences of entering into a new domestic market is also known to the
organisation and the pace of foreign market is also understood.
Diversification: through this method the organisation will acquire the process of diversification
that will bring about entire revenue to the company (Wirtz and et.al, 2021). Through this the
organisation has acquired two types of diversification one is related diversification and the other
is unrelated diversification. The potential after which the synergies can be utilised in the product
market will all fall under related diversification. The unrelated diversification will deal with the
realisation of to which the existing business can move ahead with the potential strategies. Ansoff
growth matrix is a phenomenal aspect that is a part of bringing about the strategic orientation to
the organisation can be attained. The factors that will fall in regard to market penetration,
product development, market development and diversification are all explained in the growth
matrix that is being displayed.

CONCLUSION
It has been summarized form the above reflective strategy that company has followed and
consider strategic plan for their growth and expansion of new opportunities and application of
models, analysis tools and techniques provide efficiently result and beneficial for the analysis of
external and internal forces of they impact on the business strategic plan. This study has been
clearly provided information about that how company can develop decisions with the help of
SWOT analysis and PESTEL analysis for the business expansion and growth, and they clearly
give idea that which goods and services can beneficial for the business expansion at international
level, and the unique product, different goods and services and effective production work is the
only portion to smoothly run in the huge competitive market as well as international market. This
report has been mainly given idea that if organization follow and apply strategic management
plan so it definitely useful for the overall business growth.

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