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Porter Five Force Model of Primark Assignment

   

Added on  2020-12-30

12 Pages3888 Words265 ViewsType: 265
Business DevelopmentMechanical Engineering
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PRIMARK
Porter Five Force Model of Primark Assignment_1

Table of ContentsINTRODUCTION...........................................................................................................................3a. Porter five force model to identify and analyse the current environmental influence on thePrimark...................................................................................................................................3b. Value chain model to analysis the internal business environment of Primark...................6c. Appropriate adaptions that is undertaken in response to the macro and external businessenvironmental forces..............................................................................................................7d. Reflection.........................................................................................................................10CONCLUSION..............................................................................................................................11REFERENCES..............................................................................................................................12
Porter Five Force Model of Primark Assignment_2

INTRODUCTIONBusiness environment is the combination of internal and external factors that influence abusiness operation. It is the sum total of all the internal and external factors that can affect thebusiness processes. Primark is a fast fashion retailer company which is based in London, UnitedKingdom. Company is providing the different clothing, cosmetic products, accessories, footwear,beauty products and housewares service to the customers. One of the biggest Primark stores islocated in the Manchester, market street (Ali and Khan, 2019). Company is expanding itsbusiness across the world by collaborating with other local companies.This file makes use of of Porter 5 force model to evaluate the competitive advantage ofthe company in the present market situation of the United Kingdom. Along with it, the valuechain model is used to analyse the internal business environment of the firm in retail sector.Identification of external business environment forces. Usefulness of Porter five force model inunderstanding business environment. New entrants can decrease the profitability of other firms.Differentiation of products and brand equity can affect the business of Primark.a. Porter five force model to identify and analyse the current environmental influence on thePrimark.Porter five force model is a tool to identify the impact of business environment(Ali and Khan,2019).Threat of new Entrants- Primark needs to understand that the company is having a risk of facing constant newentrants in the market. This can make the company's suffering grow and would make it hard toreach set goals and objectives. New entry of any small company can be easily archived in thepresence of Primark and marks and Spencer types of big companies. Today, small businesseshave seen to be affecting the growth of large companies such as Primark. The new entrants areseen to be competing on the basis of location, convenience, speciality etc. there are many newentrants have low cost of doing business compare by large business. All the small new entrancecan operate their fictions with low cost. Threat of new entrance shows that power can alsoaffected by the effectiveness and capability of the people in existing market. The companiesPotential competitors can be a threat of the big companies. (Stanković and Novaković, 2019).The new entrants are posing a lot of threats including the threats of having new productsin the markets as per the fresh trends. It can make the company suffer from selling its own
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products because they might get older with the new trends. The other threats includes that thenew entrants are having such products which are upscale and as per the present needs of theconsumers. It can make PRIMARK face issues related to growth and development of thecompany and selling of its products. New small companies enter in the new market with innovative ideas and new products.Their new products and low cost can give the competition to the Primark. But company can saveits brand image by innovating new products rapidly. Company should low the cost of its clothingproducts. This strategy can be helpful to overcome from the threat of new entrance. Price factorand brand loyalty will not impact the threat of new entrance to the marketplace. It will be verydifficult process for the new entrants to build same brand image and reputation likePrimark(Calhoun, and Douglas, 2019).Threat of substitutes productsSubstitute products is highly impacting the sector of the clothing manufacturers acrossthe world. It refers to the goods which are used in the place of another. In the theory ofconsumers, the substitutes and substitute goods are the products which a consumer perceives ascomparable or similar. The market of the clothing sector is filled with companies which areproducing goods and services that are similar to the organisations which are huge and areinvesting a lot in research and development. This threat is constant and is making theorganisations such as Primark to face a large number of challenges in selling of their productsand services (Calhoun and Douglas, 2019). The other threats which substitute products make theorganisation face is the challenge of earning the required profits set by the organisation in itsgoals and objectives. It is also making the organization suffer and achieve better growth anddevelopment. Strategy-1). Primark company can use the multiple suppliers to build efficient supply chain.2). Primark company can change in the product design by using different material. It will help tocompany to shift the new strategy of packaging products When prices goes very heigh of theproducts.Supplier powerImpact of this force is very low. Suppliers are the main source of the company they canshare the manufacturing venues with other new companies. Suppliers relation can also affect
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