L'oreal Business Strategy - Pestle and Swot Analysis
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Added on 2020-11-23
L'oreal Business Strategy - Pestle and Swot Analysis
Added on 2020-11-23
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BUSINESS STRATEGY
Table of ContentsINTRODUCTION...........................................................................................................................2TASK 1............................................................................................................................................3PESTLE and SWOT analysis for organization's capabilities.................................................3Porter's Five Forces Model for analysis of competitive environment....................................6TASK 2............................................................................................................................................7Evaluation of different types of strategic directions available to an organization.................7Justification and recommendation of most appropriate growth platform and strategies........9Strategic management plan for L'oreal by including strategies, objectives and tactics.......10CONCLUSION .............................................................................................................................11REFERENCES .............................................................................................................................11.....................................................................................................................................................12
INTRODUCTIONBusiness strategy refers to the course of action or set of decisions which assist theentrepreneurs in achieving specific business goals and set of objectives. In some organisation,managers need to consider how business strategies can be sustained through strategic capabilities(Brewster, 2017) . This is all about how a company will compete in its marketplace. This is thecontinuous process and conducted in each segments in order to accomplish purposes.The presentreport is about L'oreal, which is the world's largest French personal cosmetics care companyfounded in 30 July, 1909 by Eugene Schueller. This report emphasizes on PESTLE and SWOTof the organisation and an analysis of the organisation’s capabilities, along with the evaluation ofdifferent types of strategic directions has been discussed in the report. In addition with this,justification and recommendation of the most appropriate growth platform and strategies isoutlined below in the report. At last this report produce a strategic management plan withstrategies.TASK 1PESTLE and SWOT analysis for organization's capabilitiesStrategic planning is describe as management act which is used to focus energy, setprecedence, and resources to ensure that employees and other stakeholders are working to attainthe goals and objectives and adjust the organization's way in result to a ever-changingenvironment. Strategic planning produces important decisions and actions that configure andguide about the organisation and, what it does, what are its services, by focusing on upcomingfuture. L’oreal is the leading name in the cosmetic and beauty world (Cavusgil and et. al., 2014) .Their extensive portfolio of hair, skin, and make-up products is the reason why this brand is theonly one, offering so many inexpensive as well as luxurious beauty options. However,competition is rising because customers are very conscious about their face products, so when itcomes to choosing products for their skin and hair they are awake while buying that. Hence, itbecomes imperative for L'oreal to make plan of action in order to gain its position in themarketplace. Thereby, before any major decision-making, it should analyse the factors, bothexternal and internal that could affect it. This may be achieve by conducting PESTLE andSWOT, which are elaborated below :
SWOT analysisStrengthWeaknessesL'oreal is a leader in the growing cosmeticsindustry despite the competition in the market.This also offers the best to their customers.This has approx 60,000 employees around theworld. Apart from the cosmetics items, thiscompany is also active in dermatological andpharmaceutical fields. In present time, L'orealis having 23 brands operations globally inmore than 130 countries. Also this have awide-ranging distribution channel. The L'orealproducts are of highest possible quality.This company has decentralized organizationalstructure and due to their subdivisions, theyalso has the difficulty in the control of theirorganisation. Along with this, the tuffcompetition from other leading cosmeticscompany established their brands (Chang,2016) . OpportunitiesThreatsL'oreal can tap the growing market that rangesfrom the affluent, the ageing and also themasses of the developed countries. Along withthis, greater market share because of thenumerous patents is registered by the companyL'oreal.The threat of L'oreal is the growingcompetition within cosmetics industry. Alongwith thisL’Oreal may be producing the bestproducts in their sector, and for many peopleproducts of L'oreal are not necessary, so theycan omit by buying the L'oreal products. PESTLE analysisL’oreal is the one who is leading in the industry of Beauty and cosmetics all over theworld. The company is producing several varieties of beauty products in order to meet the needof fashion trends globally. It is making various varieties of products to meet up the needs of thecurrent global fashion trends. The factors that's affect the L'oreal profitability are as follows -Political Factor –The factors which are related with the government rules and policiesin which L'oreal is working. As the manufacturing company of L'oreal is in Paris sogenerally the rules and policies of France government affect the company's profitabilityvery much. With the accomplishment of globalization, political factors have impacted thebusiness industry like L’Oreal. This is being affected by various norms of UK
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