Business Strategy: Analysis of Klarna Bank

Unit 32 - Business Strategy

TABLE OF CONTENT
INTRODUCTION...........................................................................................................................3
LO1..................................................................................................................................................3
P1 Macro environmental analysis ..............................................................................................3
LO2..................................................................................................................................................6
P2 Internal environment and capabilities ....................................................................................6
LO3..................................................................................................................................................8
P3 Porter’s five forces analysis ...................................................................................................8
LO4..................................................................................................................................................9
P4 Strategic plan .........................................................................................................................9
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................13

INTRODUCTION
Business strategy is various steps and plans of company in order to take competitive
advantages in the market by attracting customer through bring innovation and idea in particular
industry. Therefore, it helps business in gaining competitive position and promote growth and
success of business in the market. This report analysis of Klarna bank that is one of the largest
bank offers online financial services to customers. It has more than 2500 employees located at 14
branches working for common objectives of company. Company mission is to provide better
customers experience through making their payment procedure easy and simple, safe and secure
(About Klarna, 2019). Objectives of company is to make modern purchase system smoother and
easier so that quick and fast relationship among customers can be made thus it aims to provide
payment solution to large number of people. Company has follows ethics and value in order to
build strong brand image and satisfy needs of customers in better possible manner for growth
and success of Bank (Klarna year-end report January – December, 2018). Therefore, this report
explains about macro and internal capabilities that impact on functioning of company by
providing opportunities to grow and expand business. It also evaluates competition level within
industry and plan for strategies in order to achieve objectives of company.
LO1
P1 Macro environmental analysis
Macro-environmental factors refers to various components which exit in particular
economic and that adversely impact on functioning of company such as economic condition,
political system and situation, changes in technology and customers trend and new legislation.
Such factors are out of control of company but directly and indirectly impact on operation,
performance and growth of firm (Joslin, 2018). Various factors that impact on performance and
function of Klarna bank are as follows:
Political Factors: It refers to policies of government that impact on functioning of banks and
other financial institution that operates its business in UK. Due to Brexit functioning of Klarna
bank has adversely affected as there is economic upheaval and non body is aware of effect of
such events on functioning of firms. Investment in the economic has reduced and high debt
among government and customers so increase in demand of more credit. Thus, many people are
even not able to pay their debt thus it impacts on company profit and performance. It can be

stated that political factors possess threat in growth and success of firm but company is able to
cope with situation because of strong brand image in the market.
Social Factors: It consists of various factors such as demographic structure, lifestyles and
various changes in environment that may provide opportunities to firm to grow and expand its
business across nation. Demographic structure of UK has influenced functioning of Klarna as
there are large number of ageing people so people try to use their saving money (Moyer, DeVries
and Spink, 2017). Thus, Bank has to make effort in order to meet needs of customers and reduces
its investment but there are some people that need credit so it helps in enchaining sales of
company.
Economic Factors: Uncertainty and various risk included in economy has influenced
performance and functioning of Klarna. Due to agreement between Britain to leave European
Union has reduces value of pound and other currencies such as Euro that impact on Klarna
adversely. Therefore, it has negatively impacted on functioning and operation of Klarna bank as
it impact on its clients, customers and employees of firm (Bauer and Rudebusch, 2016.). Another
factors less disposable income of customers has reduces saving of people in the bank so it has
impacted positively and negatively to firm.
Technological Factors: It is another factors that included technological development in the
country that helps in reducing price and performing various function within limited time.
Digitalisation helps in growth of banks as it can easily transfer payment of clients from one place
to another thus helps in providing quick and effectively services to large number of customers.
Therefore, Klarna is able to become one of leading bank in UK by continuous innovation in
technology and various ideas and helps in global transaction and promote development of
economic.
Environmental Factors: It included various steps that are taken by government in order to
ensure health and safety of employees and people working within organization. As resources in
the environment are limited so company is planning to make effort that ensure protection of
environment while firm is operating various function. Klarna has reduced carbon foot print and
also perform various activities related to CSR for welfare for employees and clients. Therefore,
able to gain competition position and expand its market share by meeting needs and demand of
customers (Mikucka, Sarracino and Dubrow, 2017). It also uses sustainable development