Macro and Micro Analysis of Ola Cabs in France

This study analyzes the micro and macro environment of Ola Cabs in France, including market trends, key competitors, customer attitudes, SWOT analysis, and Porter's Five Forces. It also includes a PESTLE analysis of the macro environment, focusing on political, economic, social, technological, and environmental factors. The conclusion highlights the favorable factors in France for Ola Cabs.

MACRO AND MICRO
ANALYSIS
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TABLE OF CONTENTS
INTRODUCTION............................................................................................................................3
MICRO ENVIRONMENT..............................................................................................................3
SWOT of Ola cabs.......................................................................................................................3
Porter Five Forces........................................................................................................................4
MACRO ENVIRONMENT.............................................................................................................5
Pestle Analysis.............................................................................................................................5
CONCLUSION................................................................................................................................9
REFERENCES...............................................................................................................................10

INTRODUCTION
The micro and macro environment of the country refers to as the overall business
environment which impacts the whole working of the business (Pelto, 2019). The present study
is based on the company Ola Cabs which undertakes its micro and macro environmental factors
which impacts its business.
MICRO ENVIRONMENT
Market Trend in the taxi market
The major trend in taxi market is that many self-driving cars have been invented and big
organizations are participating to promote these self-driving vehicles (Maphosa, 2018). Another
trend is that also water taxi has been started and is trending theme in current market. It is an
opportunity to go across river fronts, snorkelling, and many other customers for picking water
taxi.
Who are key Competitors in the market
There are many similar companies working in same sector. The major competitors of Ola
cabs in France such as Taxify, Heetch, LeCab, Chauffeur prive, Le Taxi and many others
(Gonzalez-Feliu and et.al., 2014).
Customer attitude
The attitude of consumers towards the taxi is very welcoming and positive because of the
reason that there are many different and large tourist places in France and therefore for the
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residents of the country it is a medium of travelling. So, the residents of France promote the taxi
business (Zhang, Zhong and Jiang, 2017). Also, another reason is that the fuel prices are very
increasing and if the people will go on with their vehicles then they have to fill their vehicles
fuel. Instead of this the consumers prefers to take cabs and go wherever they wish to go.
SWOT of Ola cabs
Elements Description
Strength The company ahs the first mover advantage
as a taxi aggregator.
The company is having a high consumer
base and high network.
Weakness The misbehave of the drivers impact the
goodwill of the company as the drivers are
the only people who represent the company.
Another weakness is that the amount of cash
burning is high.
Opportunities The major opportunity is of increasing
internet use and increase in the usage of
smart phones can be a great opportunity to
be used.
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One opportunity is acquisition of the other
small business dealing in the same business.
Threat The major threat is the high competition
within the market.
The changes taking place in the taste and
preferences of the consumers due to
changing business environment.
Porter Five Forces
Threat of new entrants- it is a factor which studies that how many new entrants can enter
into the market of France relating to logistic industry. Understanding and estimating the new
entrants will give an idea to Ola cabs that how much competition is present in France. There are
many entry barriers for the new entrants like the competition is already high, the entering cost is
very high, the investment is also high. Thus, this the threat of entrant is low as the entry cost is
high. Thus, it is beneficial for Ola cabs.
Threat of substitution- these factors suggest that how many substitutes are available in
France relating to cabs and taxi services (Baum, 2019). This factor will help company in
knowing that how much existing competition is there in France. This will help Ola cabs in
beforehand defining and deciding the strategies for overcoming these substitutes. The threat of
substitution is high because if the consumers will not go for cabs then they will use some other
source of travelling.
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Bargaining power of supplier- it refers to as the degree of power which lies in the hands
of the suppliers of raw materials. Studying this factor is of importance because if the suppliers
are in power then company have to agree to the conditions of the suppliers. The bargaining
power of the suppliers is low for Ola cabs. This is due to the fact that the suppliers are many and
thus they have to agree to the conditions of the different cab companies.
Bargaining power of buyers- this is also an important factor to be studied because the
profitability ultimately lies in the hands of consumers. So, it is very necessary for Ola cabs to
understand the bargaining power of buyers in France (Pelto, 2019). The bargaining power of the
buyers is low as there are many different companies dealing in the cab services. Thus, the buyers
have many options for using the cab services.
Threat from rivalries- since the competition is so tough so it is very necessary for the
company to understand the level of rivalry in France. This will help the company in
understanding the trends and methods of practice used by other rivals in the country. The threat
of competition is very high because of the reason that there are many different companies which
are dealing in the same business. Thus, it is very difficult for Ola cabs to sustain the high
competition.
MACRO ENVIRONMENT
Pestle Analysis
Political and legal factor
Country- 01: France
France shares good Bilateral relation with other countries and enjoys political stability. The
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government of France has no policy or restriction for new entrants but French government has
set fixed investment limit for foreign enterprise which 1,500,000 Euros. The government of
France have made regulation that all the cabs will charge its customer on the basis of kilometres
run and not at the time of booking the cab (French political culture, 2004). Also, the
government has made the regulation that the drivers of the private chauffeured vehicles must
come back to their position only after dropping the passenger to their desired place.
Country- 02: Italy
It follows a framework of democratic republic and a multi-party system and is based on Roman
law. In Italy, the taxi cabs need to be white and yellow colour. In present time there is a harsh
policy relating to taxi business and many people are against the licenses for the drivers and they
are protesting it.
Country- 03: Netherlands
The political system of the country is a decentralized and democratic state. The foreign policy
includes integration with Europe, international development, compliance with international law
and maintaining transatlantic relations. Coalition of different parties forms the government of
Netherlands. In Netherlands, many electric Tesla cabs are replacing the petrol and diesel cabs
and needs to be licensed. The taxis need to be light blue in colour the number plate with black
characters on it.
Economic factor
Country- 01: France
France shares top 10 economies of world in export and FDI in France has increased in form of
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start-ups and expansion. The GDP of France continuously increase which denotes good
economic position and favourable factors to set up business. The GDP of France increased by
0.2 % in the second quarter of 2019 in comparison with previous quarter (France GDP- Gross
Domestic Product. 2019).
Country- 02: Italy
It is very rich in terms of GDP and is a capitalist economy. The country has 4th
largest reserve of
gold and has innovative businesses going on in the country. The inflation is based on consumer
prices index. The GDP of Italy for the first quarter of 2019 was around $502,184 million.
Country- 03: Netherlands
The country is on its way for economic recovery but its source of public finance is in fragile
position (Anderson and Raeisinia, 2018). The Gross Domestic Product of Netherlands
increased by 0.5 % in the first quarter of 2019 as compared to last year.
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Social factor
Country- 01: France
Two major language used in France are French and Catalan and there are people of different
religions that is Jewish, Muslim and Roman catholic and Islam is second largest religion
followed in France. The taste and preferences of people of France is that they are passionate
about food and the place is famous for cheese, wine and cuisine. The culture of cabs is trending
in France as it is very convenient for residents of country to go to any place with help of these
taxis. Also, another reason for success of Ola cabs is that there are many tourist destinations in
France such as Eiffel towers, Palace of Versailles, Louvre museum and many other different
destinations (Reiman and et.al., 2015). It is beneficial because of the reason that many tourists
will come to visit these places and for travelling they will require taxis and this will increase
their business.
Country- 02: Italy
It is the sixth most valued country which exports brand and accessories. The culture of country
includes architecture, food, music, art and family culture. The people of Italy pass on their
culture to younger people ion the society. The people are much connected to their culture,
ethics, morals relating to the society.
Country- 03: Netherlands
The language prevalent in Netherlands is Dutch and is spoken by almost every person in that
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country (Salvati and Korsunsky, 2017). According to Hofstede culture model Netherlands score
38 which is very low which means that it follows the Dutch style.
Technological factor
Country- 01: France
It is the most technically advanced country and has a remarkable history in IT, science and
technology. It launched its first satellite around 50 years ago. Almost 80 % of residents are
using internet in France (Cercignani and Gandini Wheeler‐Kingshott, 2019). The innovative
technology used by France is the use of NextGen batteries for the cabs to help them if the cab
stops.
Country- 02: Italy
It has a very strong technological background and it focuses more on technological
advancement because of efficiency increased by the use of technology. For technological
advancement and up gradation, it paired up with USA. The emerging technological
advancement is that it has started installing brain-controlled computer interface which allows
drivers to direct the way to drop the customers to their place.
Country- 03: Netherlands
In technological aspect of the country is popular for its engineering innovation, and has high
expertise in water management and environmental technology. The latest technology promoted
by Netherlands is the electric cars are being replaced with the petrol and diesel cabs.
Environmental factor
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Country- 01: France
One third part of France is forest area which indicates that the country is focusing on protecting
the land and species living on the land. The weather of France is continental, oceanic and
Mediterranean. The oceanic climate is prevalent in western part of country and continental
climate is prevalent in eastern and central France. On the other hand, the taxi sector of France
also works on reducing the carbon emission and emission of other gases and effluents from car
which harms the business (de la Rúa and Lechón, 2016).
Country- 02: Italy
The country lay much emphasizes on the environmental factor because the country has amazing
ambiance, beautiful landscape, snow covered mountains, perfect weather and many other
factors. Therefore, it does not want to deteriorate it with the emission from the taxis. The
country is having a variety of climates like the inland area of Italy is relatively cool as
compared to coastal areas.
Country- 03: Netherlands
The country lay much emphasizes on the environmental factor because it has very good
environment having dense forest and overwhelming scenes (Will and Mueller, 2019).
Netherlands enjoys a moderate maritime or oceanic climate which features combination of cool
summer and mild winters.
For choosing one country out of all the three France have been chosen. It is because of
the reason that the political and legal factors are favourable for Ola cabs. Also, the culture of
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country France is appropriate for Ola cabs. It is because of many reasons like in France because
of too many tourist places and destinations it is an opportunity for Ola cabs because of the reason
that many people will visit France to travel and will need taxi for travelling and this will increase
the profits of the business. Another reason is that in France use of neaten batteries is much
prevalent and this helps the cab at times when suddenly the cabs stops.
CONCLUSION
With the completion of this report it was concluded that analysis of micro and macro
environment is very necessary for the company in knowing the position of company in the
external environment. So, for this it took help of PESTLE analysis for studying the macro factors
and its impact on the company's operation. On the flip side, for understanding the micro
environment it is very crucial to use Porters five forces model.
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REFERENCES
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Salvati, E. and Korsunsky, A.M., 2017. An analysis of macro-and micro-scale residual stresses
of Type I, II and III using FIB-DIC micro-ring-core milling and crystal plasticity FE
modelling. International Journal of Plasticity. 98. pp.123-138.
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Will, M.G. and Mueller, J., 2019. Towards a micro-foundation of organizational change:
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France GDP- Gross Domestic Product. 2019. [Online]. Available through:
https://countryeconomy.com/gdp/france
French political culture. 2004. [Online]. Available through: <
https://www.theguardian.com/education/2003/oct/01/languageresourcesfrench.languagere
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