Strategic Management

The aim of this report is to discuss about the business viability and process of Pureponics in the Australian market. It is identified that they are one of the leading innovative sources in the Australian aquaculture sector. In addition, it is also identified in this report that they are following differentiation and market focus strategy in their business operation. The competitive scenario of Pureponics is also analyzed in this report and few challenges are identified. This report recommended that Pureponics should focus on product and market development in order to gain long term business viability.

Running head: STRATEGIC MANAGEMENT
Strategic management
Name of the student
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Executive summary
The aim of this report is to discuss about the business viability and process of Pureponics in the
Australian market. It is identified that they are one of the leading innovative sources in the
Australian aquaculture sector. In addition, it is also identified in this report that they are
following differentiation and market focus strategy in their business operation. The competitive
scenario of Pureponics is also analyzed in this report and few challenges are identified. This
report recommended that Pureponics should focus on product and market development in order
to gain long term business viability.

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Table of Contents
Introduction......................................................................................................................................3
Company analysis............................................................................................................................3
Identification of the business level strategies..................................................................................4
Determination of the competitive reality.........................................................................................5
Determination of the implementation strategy................................................................................7
Determination of the evaluation strategy.........................................................................................8
Recommendations............................................................................................................................8
Conclusion.......................................................................................................................................9
Reference.......................................................................................................................................10

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Introduction
In the current business scenario, innovation in the business operations is important in
gaining competitive advantages. This is due to the reason that current industry situation is much
competitive in nature and innovative approach can only help in fending off this competitive
intensity. In terms of the Australian business perspective, agribusiness is one of the most
emerging and highly competitive sectors with the presence of number of players and continuous
inflow of investments (Bush et al. 2013). Aquaculture is an emerging area in the agribusiness
sector, which involves the water resources in the farming activities. Pureponics is an emerging
and new aquaculture startup from Australia. They are involved in the farming activities of both
vegetables and fisheries in sustainable manner. The most innovative element of their business
process is the use of the water resources. The farming activities of Pureponics are unique due to
the reason that same water resources are being utilized for fishing and agricultural process.
This report will discuss about the business process and practices of Pureponics and the
business level strategies being followed by them. The intensity of the competitive rivalry for
Pureponics will also be discussed in this report. Based on the identified factors, a few
recommended steps will be discussed.
Company analysis
As of now, Pureponics is only having single unit based on the organic food products.
However, their product portfolio is diverse ranging from different vegetables, fruits and fishes. It
is identified that the largest revenue generating unit for Pureponics is their organic vegetable
production. This is due to the reason that organic food products are witnessing huge growth in
terms of the market demand. In addition, vegetables are having more acceptances in the market

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compared to the fish items. Hence, it can be concluded that major revenue of Pureponics is
getting generated from the organic farming unit.
Identification of the business level strategies
Determination of the business level strategies is important to identify because it
determines the effectiveness and efficiency of Pureponics in terms of operating in the market and
gaining profitability. According to the Porter generic strategies, there are majorly three business
strategies that can be beneficial in gaining competitive advantages. The first business strategy is
the cost leadership, which refers to the process of offering the products in the market in minimal
price compared to the competitors and attracting the larger target segments. This reduces the
profitability but increases the sales volume (Khalili Shavarini et al. 2013). Furthermore,
differentiation is another business level strategy and that states about the process of offering
distinctive and unique offerings to the customers. Thus, the value proposition will be different
and unique in this case. The last type of the business level strategy is market focus. This refers to
the process of targeting and focusing on a particular market segment and offering the value
proposition according to their respective taste and preference pattern. This helps in having the
higher set of market penetration and higher customer satisfaction level in the niche target
segment. However, the potentiality of having higher sales volume will be low in this case
(Banker, Mashruwala and Tripathy 2014).
In the case of Pureponics, it is identified that they are following differentiation and
market focus business strategy. This is due to the reason that product strategy of Pureponics is
different with that of their competitors. There are number of competitors being operating in the
same sector as Pureponics but none of them are practicing the aquaponics or aquaculture

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techniques. Thus, the value proposition of Pureponics is different to that of their competitors.
The addition of the sustainable business elements in the value proposition is also contributing in
enhancing the differentiating factors for Pureponics (Kaliappen and Hilman 2013). This business
level strategy of Pureponics is enabling them in charging high price for their products and their
target customers are willing to pay the premium price for availing the distinctive value
proposition.
On the other hand, it is also identified that Pureponics is following the market focus
strategy. This should be noted that Pureponics is operating in the premium segment and charging
high price for their products. Thus, they are operating among the niche target segments, which
are limited. In this case, the value proposition of the products of Pureponics is designed on the
basis of the taste and preference pattern of the targeted customers (Urde, Baumgarth and
Merrilees 2013). The target customers of Pureponics are expecting organic food products with
proper taste and nutritional factors and on the basis of these expectations; business process of
Pureponics is designed. This business level strategy of Pureponics is ensuring that customer
retention and loyalty is more for them in the niche segment.
Determination of the competitive reality
Determination of the competitive reality is important due to the reason that it helps in
identifying the competitive rivalry and intensity in the business sector where Pureponics is
operating. The following table will discuss about the competitive rivalry on the basis of the
Porter five forces analysis.
Bargaining power of the buyers  Bargaining power of the buyers is moderate due to the
reason that there are number of competitors offering

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the same items but the distinctive value proposition is
the key differentiating factor (Dobbs 2014).
 However, the bargaining power of the buyers is
increasing with the increase in the competition in the
market.
 Emergence of cost effective alternatives in the market
will further increase the bargaining power of the
buyers.
Bargaining power of the
suppliers
 Bargaining power of the suppliers is low for
Pureponics. This is due to the reason that Pureponics is
not based on the external suppliers.
 Backward integration is practiced in house by
Pureponics
 However, forward integration process is majorly based
on the external partners.
Threat of new entrants  Threat of new entrants is high for Pureponics due to
the reason that there are number of new entrants
already entering in the market.
 The level of investment can be low in entering in this
sector by operating in the limited market segments.
 However, it is difficult for the new entrants in gaining
the economies of scale of Pureponics within the short
time.

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Threat of substitutes  Threat of substitutes is high for Pureponics due to the
fact that there are number of other organic food brands
are operating in the same sector.
 There are number of cost effective substitutes also
available in the Australian market (Schwenger, Straub
and Borzillo 2014).
 Price based war is having high probability in the sector
with the further increase in the competition.
Competitive rivalry  Competitive rivalry is high for Pureponics is high with
the presence of number of competitors.
 Each of the operating players is trying to gain the
market share by means of different strategies.
Determination of the implementation strategy
Objectives Activities Resource Responsible
stakeholder
Timeframe
Gaining larger
market share
Initiating market
development
strategy
Financial
resource and
human resource
Market and sales
managers
1 year
Increasing the
business revenue
Concentrating
more on
increasing the
business
Operational
capability and
human resources
Operating and
human resource
manager
6 months

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profitability
Higher reach of
the brand
Branding and
promotional
activities
Promotional
tools and
financial
resources
Marketing
manager
6 months
product
development
Increasing the
product varieties
and items
Financial
resources and
operational
capabilities
Production
manager
6 months
Determination of the evaluation strategy
The evaluation strategy of Pureponics should include fewer key performance indicators.
This will includes measurement of the rate of new customer acquisitions, increase in the business
revenue and measurement of the brand awareness in the market. Measuring the rate of the new
customer acquisition will help in having the understanding about the effectiveness of the
business in attracting the new customers (Rodrigue, Magnan and Boulianne 2013). Determining
the business revenue will help to identify the efficiency of Pureponics in increasing their
business profitability.
Recommendations
 It is recommended that Pureponics should initiate new market development strategy in
order to gain the new market potentialities beyond their home market. This will help
Pureponics in increasing the business viability and exposure.

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 It is also recommended that Pureponics should focus more on Omni Channel promotional
and marketing process in order to gain higher reach in the market. This will help in
gaining more market exposure among the target segments.
 Lastly, Pureponics should focus more on developing new product varieties including
offering more competitive priced products. This will help them in having higher market
penetration in their existing market.
Conclusion
Thus, it can be concluded that there are huge opportunities available for Pureponics in
their existing business scenario. In this report, different business elements of Pureponics are
being discussed including their business level strategies. It is identified that Pureponics is
following differentiation and market focus strategy. In addition, this report also analyzed the
competitive scenario for Pureponics and different threats and challenges are identified. A few
recommended steps are discussed that can be beneficial for Pureponics in enhancing their long
term business viability. The implementation and evaluation plan is also discussed in this report
for Pureponics for effective management of the recommended steps.

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Reference
Bush, S.R., Belton, B., Hall, D., Vandergeest, P., Murray, F.J., Ponte, S., Oosterveer, P., Islam,
M.S., Mol, A.P., Hatanaka, M. and Kruijssen, F., 2013. Certify sustainable
aquaculture?. Science, 341(6150), pp.1067-1068.
D. Banker, R., Mashruwala, R. and Tripathy, A., 2014. Does a differentiation strategy lead to
more sustainable financial performance than a cost leadership strategy?. Management
Decision, 52(5), pp.872-896.
E. Dobbs, M., 2014. Guidelines for applying Porter's five forces framework: a set of industry
analysis templates. Competitiveness Review, 24(1), pp.32-45.
Kaliappen, N. and Hilman, H., 2013. Enhancing organizational performance through strategic
alignment of cost leadership strategy and competitor orientation. Middle-East Journal of
Scientific Research, 18(10), pp.1411-1416.
Khalili Shavarini, S., Salimian, H., Nazemi, J. and Alborzi, M., 2013. Operations strategy and
business strategy alignment model (case of Iranian industries). International Journal of
Operations & Production Management, 33(9), pp.1108-1130.
Rodrigue, M., Magnan, M. and Boulianne, E., 2013. Stakeholders’ influence on environmental
strategy and performance indicators: A managerial perspective. Management Accounting
Research, 24(4), pp.301-316.
Schwenger, D., Straub, T. and Borzillo, S., 2014. Non-governmental organizations: strategic
management for a competitive world. Journal of Business Strategy, 35(4), pp.11-19.

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Urde, M., Baumgarth, C. and Merrilees, B., 2013. Brand orientation and market orientation—
From alternatives to synergy. Journal of Business Research, 66(1), pp.13-20.