JLL Company: Strategy and the Global Competitive Environment

This paper analyses the external environment of JLL Company, the largest publicly trading commercial real estate company, through a PESTLE analysis and Porter's Five Forces Framework. It also includes a competitor analysis and recommendations to help the company compete with its main competitor, CBRE Group.

Running head: JLL COMPANY 0
STRATEGY AND THE GLOBAL COMPETITIVE ENVIRONMENT

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Abstract
Jones Lang LaSalle is popular firm in real estate industry. JLL is a well known
company as the largest publicly trading commercial real estate company. The company
resorts to the clients several needs and requirements. In this paper the focus will be given on
the strength and weaknesses of the company. There is an analysis of the opportunities and
threat of the company, that enables the company in creating strategies by tapping advantages
in a careful manner. The main aim of analysing the external environment is to find out the
overall scenario of the company.

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Contents
Introduction..............................................................................................................................4
PESTLE Analysis.....................................................................................................................4
Economic:.............................................................................................................................4
Technological:......................................................................................................................6
PORTER’s FIVE Framework..................................................................................................7
Rivalry:.................................................................................................................................7
Substitute threat....................................................................................................................7
New Entrants Threat.............................................................................................................8
Buyers Bargaining power.....................................................................................................8
Suppliers Bargaining power..................................................................................................9
Competitor analysis................................................................................................................10
Recommendations:.................................................................................................................11
Conclusion..............................................................................................................................12
References:.............................................................................................................................13
Bibliography...........................................................................................................................15

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Appendix................................................................................................................................16
Opportunity.........................................................................................................................16
Threat.................................................................................................................................16

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Introduction
Jones Lang LaSalle company is an American professional services firm which specializes in
real estate and investment management. It is a British firm founded in 1783 in London. The
company aims to provide an opportunity and amazing space from where people can achieve
their dreams. The company built better future for the clients, communities, and people. It has
500 other subsidiary companies with 300 corporate offices. 83,500 employees are currently
working in 80 different countries under the organization.
The company gives the services like leasing, real estate, capital markets, and tenant
representation. JLL comes under the world’s most ethical companies. It is known as the
largest publicly trading commercial real estate in the world. The company analyses the
investment philosophy of clients, then interpret the requirements and respond to them
accordingly giving final advice to the clients. The company has experts to improve the
performance of the real estate in the field of life-science, hospitals, hotels, legal, office, retail
and many others. The company has 200 offices to meet the global and regional needs (JLL,
2018).
In this report, The external environment is critically assessed with the help of PESTLE
analysis and Porter’s five forces. After analysis of the external environment, some
recommendation is also reported.
PESTLE Analysis
Economic:
In the world, US has the largest economy with the GDP $ 16.760 trillion and also showing a
consistent rise.

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(Source: Fuller, 2017)
The graph represents the US GDP growth rate is fluctuated. But in 2017, GDP rate of the US
is increasing in the continuous manner. GDP of the US increases constantly which is a
favourable factor for JLL company. The economic system of the country is developed. But
the recession affects the country and it also increased the unemployment in the country.
Unemployment rates affected the company by continuously rising in unemployment rates
which does not help the company. The economic growth of the country around 4% on which
businesses and customers have stepped up for spending the money.
(Source: Grahn, 2017)
The graph indicates the US unemployment rate which is continuously decreasing from 2009
to 2017. Continuously degradation in the unemployment growth rate has negatively affected
the company. Unemployment rate of the company decreases the company growth which is

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not beneficial for JLL company because at this time period people invest less in the
properties as compared to other. The company affected by the economic growth of the
country. Economic conditions are developed by the government and political policies which
affects the company growth in long run. JLL affected by the unemployment rates, interest
rates and economic growth (Keith, 2017). Interest rate of the economy affects the company
profitability. Increasing interest rate also increases the investment in the country. Therefore,
the interest rate is very important for the real estate industry.
(Source: Richter, 2017)
According to the graph, commercial real estate company take loans in the increasing rate
from the financial institutions. Increasing interest rate of loan has a negative impact on the
real estate industry because industry suffers loss. Oil rate affects the cost of the company in
its project. If oil rate is increased then transportation cost of the company is also increasing
which affected the profit margin. Nowadays, international financial institutions have a high
interest rate which affects the growth and success of the company. It is a drawback that the
company has few business links with the other countries which is less as compared to the
others (Clough, and Bell, 2016).

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Technological:
Technology and innovation are the main factors of the US economy. The country adopts the
technology for the growth that is why the US face the competition with the rising economy.
JLL also adopt the technology for business but the different types of technology affects the
booking and rent of the properties online. The company invests $100m in the technology for
improving the company services. Customer online order material and method of building
homes creates the problem for the company. The US enhance the technology in the many
areas such as environmental technology, biotechnology, and nanotechnology which opens the
opportunities for the company (Ho, 2014). The company operates the business in the world
that is why the company faces the competition from the countries like China. The company
operates the business in many countries that is why the company has competition from the
other countries like China. China has links in the world by investing or outward flow of
goods.
(Sources: Molon, 2014)
This graph indicates the China investment rate in real estate industry. China has more
technologies that is why it invest more in market expenses which is beneficial for expanding
the business. JLL research group is presented the seventh annual technology. The various
technologies and social provider provide financial support to the company. The company

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invest more in technology and it increases the cost. The company has a drawback to investing
more in the technology instead of other activities. The company did not make the budget
strategy properly from which they can invests in further activities (Srdjevic, Bajcetic, and
Srdjevic, 2012).
PORTER’s FIVE Framework
The company uses the Porter Five Forces Framework to enhance the business. The factors are
as below:
Rivalry:
James Long LaSalle is a well known popular company that is why company face more
competition in the land development. Competitor faces this problem because company
ignores the competition. By ignoring the competition, competitors introduce the product in
the different market at the different time. Sometimes, competitors of the company
differentiate the products and increase the variety of product. Competitors make their
products different to the JLL company product from which they can expand their market but
expand in the different place. The competitor of the company adopts the supply chain
strategy from which they can supply the product on the time or increase the demand. They
also provide the services to the client in all over the world. JLL sets the different segment as
compared to the competitors that is why company comes in the top industries in top segments
(Dobbs, 2014).
Substitute threat
James Long LaSalle is the kind of company which is high in demand. Reasons behind the
high demand that the company provides the accommodation and it makes the investment
value. The company has a number of competitors such as CBRE, Knight Frank, and many
others. Competitors of the company make the different strategies as compared to the JLL

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strategies to grab the market. Competitors of the company operate in the fortune company
with the good quality of management (Stead, and Stead, 2014). The company has threats to
the other competitors but it takes the advantages by providing the properties on rent to those
who want to take the property at the low cost.
The company makes the other strategies from which they can compete with the other
competitors. JLL provide the properties to the customer in the low investment. But the
company has to make more strategies for the development or to compete the competitors with
some unique features in the services. The company uses the new technologies to reduces the
cost and make the substitute services differ from the other companies. It has the positive
impact on the profitability of the firm (Hagos, and Pal, 2010).
New Entrants Threat
JLL company does not require any permission or special authority to enter in the market.
Because in the real estate industry no authority and permission is required at the time of entry
into the industry. Even a single person does not need any to take the permission or the higher
knowledge from which they can prevent himself to enter into the real estate industry (Hendel,
Nevo, and Ortalo-Magné, 2009). To enter the market, the company or an individual require
the financial stability or capacity to increase the finance by the financial resources. JLL has a
number of competitors which strongly compete with the company. Therefore, the company
has to develop their strategies or activities from which they can enter into the new firms by
maintaining the customer demand (Porter, 2008).
Buyers Bargaining power
The company works in the two season that is a peak or lean season. In the peak season of the
company, bargaining power of the buyers decreases or cannot be affected the company
because at this time company offer its services at the high rates. In lean season, bargaining

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power of the buyer's increases because at this time company demand decreases of their
services at some level (Turnbull, and Valla, 2013).
Bargaining power of the buyers relies on the rules, regulation, and laws which are made for
the consumer protection. Some acts are also made which is related to the consumer
protection. In real estate market, rates increases continuously due to increases population
(Brueggeman, and Fisher, 2011) From this company take the advantage and this factor is
beneficial for the company and offer the services at the higher rate. It affects in a positive
way on the profit of the company.
Suppliers Bargaining power
The suppliers of the JLL company does not have strong power because of the particulars
buyers. For the JLL, it is a beneficial factor because company invest in the low prices or offer
at the high rates. In real estate industry, suppliers of the industries do not have strong
bargaining power. The suppliers of the real estate do not have the power to pressurize the
rates of property because of the limited number of buyers. The industry has five types of
suppliers such as construction contractors, land sellers, capital providers, building material
manufacturers and home furnishing. It is a favorable factor of Porter’s model for the JLL
company because the company does not require to pay hire for the higher development.
Jones Lang LaSalle has huge favorable factors which company can expand the business as
well developed. By using Porter Five Forces Framework the external environment is
analyzed which is beneficial for the company (Mathooko, and Ogutu, 2015).
Competitor analysis
To analyze the competitor behavior, the company have to analysis the competitor's profile. In
external environmental company competitor analysis is also included. JLL competitors
behaviors are as follows:

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Jones Lang LaSalle has various competitors such as Knight Frank, CBRE, and others. The
main competitor of the company is CBRE Group. CBRE comes under the world largest
commercial real estate services. It has 80000 workforces in the company with 450 offices in
the world. CBRE provides integrated services including project management, investment
management, Property management, strategic consulting and others. It also provides the
services in Real estate Industry. The main aim of the company is to maintain the position in
the market. The current and the future objective of the company is to introduce the new
products and services by adopting the new technology. CBRE Group making the strategies
for future to grab the market opportunities (Rubin, 2015). For entering into the real estate
industry, the company requires the sufficient capital and the ability to increase the finance by
the financial resources. CBRE Group has the sufficient capital and also has a large number of
resources. The company willing to maintain its stability in the market for this its regularly
focus on the development of the human resources by giving them training (Upson, Ketchen,
Connelly, and Ranft, 2012).
The company also give attention to investing in its research and development department
which makes the leading company in the market. CBRE Group has a large number of
resources that is why it can arrange the resources within the time as per the customer's
demand. For providing the unique services and innovative company has to focus on the future
objectives which can be accomplished by making the new strategies (Bose, 2008).
Recommendations:
From the above analysis, it is indicated that JLL company have to be aware of the CBRE
Group strategy. The company should adopt the new strategies by adopting the new
technology. The strategy should be different from the CBRE Group strategies. New strategies
cover all future objective (Paunescu, 2013). The company has to focus on the current strategy
of the CBRE Group from which they make the different strategy and grab the market in the

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large area. By adopting the technology, the company has to make special services to the
customer which is also beneficial for the profit of the company. The company should make
the budget strategy for market expenses. There are many avenues in which company invest in
marketing for expanding the business through email marketing, postal marketing instead of
investing more in technology. The company should make the strategy for expanding the
business or increases profits margin. For this, the company should take loans at the low rate
from the other countries and invests at the high rate. These two strategies try to overcome the
drawbacks of the company (Smith, 2018). On the basis of the analysis, competitors of the
company are increased day by day that is why the company has to come out from its coziness
and enter into the new market. For entering into the new market, the company requires the
sufficient capital. By using the PESTLE company should aware of the external environment
which is beneficial for the company such as economic, and technological factors. And by
using the Porter Five Forces Framework company should analyze the behavior of the buyer,
suppliers and the threats which company has to others external factors. By analyzing these
factors company should adopt the strategies according to all scenario.

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Conclusion
Jones Lang LaSalle company is the real estate company in America. For analyzing the
external environment PESTLE, Porter Five Forces Framework is used. The analysis said that
company has to maintain the political relationship by following rules and regulation of the
government of the different countries. It has to adopt the new technology from which
introduce the new product or services which is different from the other companies.
The company has large numbers of a competitor in the market. The main competitor of the
company is CBRE Group who compete for JLL in the market of real estate. The company
should adopt some strategies which are not experienced by the other companies. CBRE
Group has huge resources from which they can easily enter into the market and expand his
business in the real estate industry. Therefore, the company takes steps carefully for making
the strategies to enter into the new market of real estate.
It can be said that the company has a threat but also have some favorable factors to whom
company make their strength and increase profitability and the productivity. Anyone can
enter into this market with the sufficient cash which is a threat for the company. It is a perfect
competition market that is why company take every decision by analyzing the external and
internal environment.

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Bose, R. (2008) Competitive intelligence process and tools for intelligence analysis.
Industrial Management & Data Systems, 108(4), pp. 510-528.
Brueggeman, W.B., and Fisher, J.D. (2011) Real estate finance and investments. New York:
McGraw-Hill Irwin. pp. 5-6.
Clough, E., and Bell, D. (2016) Just fracking: a distributive environmental justice analysis of
unconventional gas development in Pennsylvania, Environmental Research Letters, 11(2), p.
025001.
Dobbs, M. E. (2014) Guidelines for applying Porter's five forces framework: a set of industry
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Fuller, L. (2017) The Vital Signs For The U.S. Economy Are Getting Worse. [online]
Available From: https://seekingalpha.com/article/4082701-vital-signs-u-s-economy-getting-
worse [Accessed 23/07/18].
Grahn, U. (2017) U.S. Unemployment Rate Decreases Further. [online] Available from:
https://www.statista.com/chart/8974/us-unemployment-rate/ [Accessed: 29/06/18].
Hagos, T.M., and Pal, G. (2010) The means of analysis and evaluation for corporate
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Helms, M.M., and Nixon, J. (2010) Exploring SWOT analysis–where are we now? A review
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215-251.

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Hendel, I., Nevo, A., and Ortalo-Magné, F. (2009) The relative performance of real estate
marketing platforms: MLS versus FSBOMadison. com. American Economic Review, 99(5),
pp. 1878-98.
Ho, J.K.K. (2014) Formulation of a systemic PEST analysis for strategic analysis. European
academic research, 2(5), pp. 6478-6492.
JLL, (2018) About us. [online] Available from: http://www.jll.com/about [Accessed
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analystsand-maybe-a-big-one.html [Accessed: 29/06/18].
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commercial-real-estate-bubble.html

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Appendix
For analyzing the external environment, OT of the company is analyzed which are as follows:
Opportunity
The company has some opportunity to expand the business to cover the weakness. These are
given below:
• Cost of transportation is low for the company because of low prices of shipping. It can
also down the cost of the company which has an opportunity to boost its profitability or
passes to the customer to gain the market share.

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• The new trend can open new markets for the company. It also provides the great
opportunity to build the new revenue for the company.
• New taxation policy has a positive impact on the company. It opens new opportunities for
the JLL.
• By adopting online channel for the communication between the customer and the
company has opened the new sales opportunity (Helms, and Nixon, 2010).
Threat
JLL is the world most ethical company that is why if it has an opportunity but it also has
some threats. There are some threats are as follows:
• By rising, the raw material can be a threat for the company.
• Technology adopts by the competitor is the big threat for the company.
• The demand of the company is seasonal in nature and also it is based on the peak season
which can affect the company profitability in short to medium term.
• China increasing prices can be a serious pressure on the profitability of the company.
From the above analysis, These are the opportunities of the company to take advantages but it
also have some threats. therefore, the company has to be aware at every step (Siciliano,
2016).

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