Strategic Report: Bicworld's Business Environment Analysis

This strategic report provides a comprehensive analysis of Bicworld, a company in the FMCG industry. The report begins with an executive summary highlighting the importance of strategic analysis for product and service development. It then delves into the external environment using PESTL...Read More

STRATEGIC REPORT

Executive summary
This report has shows business and its important strategy which has important for the
develop products and services at marketplace. Strategies has plays an important role in the
organisation with the help of this strategy company Bicworld grow highly. With the help of
PESTLE analysis company get know about the various factors like political, social, economical
and technological factors by understanding those they has able to make new strategy as per
requirement. Porter five force shows the competitors of the company who has harmful for the
business as well as VIRO model has also show the internal analysis of company analysis. By that
got idea about the work and needs of marketplace. In that company manager made new product
with unique features by this customers are attracted towards the business and its growth. For
evaluating new strategy company has use SAF model by this manager able to evaluate those in
effective manner.

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
1. External environment analysis...........................................................................................1
2. Internal environment analysis.............................................................................................3
3. The strategic analysis.........................................................................................................4
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................7

INTRODUCTION
The purpose of this strategic report is inform group members of company and FMCG
industry. That is help to assess direction for perform duties and play job roles at organisations.
This report is replaced operating and financial review and business review section of the annual
report (Adi, 2015). It is the directive report which is help to take decisions for consumer goods
manufacture industry. Report will cover the external environmental analysis by using PESTEL
for macro external and 5 forces for micro external environment. The structure of report will show
the internal environment analysis by using the appropriate resources and capabilities. This will
show strategic analysis of the business level strategy and evaluation of strategy by using SAF
model.
MAIN BODY
1. External environment analysis.
External analysis is the primary study and analysis of macro environment forces. Those
are help to done industry and competitor’s analysis in purview of organisation's growth. For that
analysis PEST analysis is best for macro level and for the micro level porters 5 forces are below:
PEST analysis for Consumer goods manufacture industry at macro level
PEST analysis is help to consumer goods manufacture industry which is Bicworld world
for exploit and makes changes according to demographic and economic trends (Bini, Dainelli
and Giunta, 2016).
Political factor
The political factors are consist and related to the level of intervention and nature of its.
This includes the various roles, government policies and system play an effective role in nature
and various objectives polices. The government of UK allocate and time scale improves
investment in the consumer sector. It gives wider acceptance by suggesting polices towards the
population. This can impact on the Bicworld world Company which is related to Consumer
Goods Manufacture Company.
Economic factor
Economic factor is representing various factors which are impact to the consumers goods
manufacture company which is Bicworld world Company. That includes exchanges rate,
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inflation rate, interest rate and taxation rate. Exchanges rate impact to the business and industry
not only short term and also to the long term investment plan (Chatzoglou and et.al., 2018).
Social factor
Social factors not only help to companies like to understand the way of doing business
and also help to understand the preferences of customers. This includes the various factors such
as the gender role, culture, attitudes and interests. Education level is high and biggest at the UK.
It can leverage to expand its presences UK. This can be impact to the consumer manufacture
company which is Bicworld world Company.
Technological factor
Technology factors are impact to the business and its growth. This includes various
factors such as innovation in product, rate of technology driven, access information and
innovation customer’s services. Technology transfer and licensing issues for the industry of
consumers sector is strong technology of culture transfer and companies. The technology is
creating the biggest impact on the industry by creating competitors for that.
Porter’s five forces for consumer’s goods manufacture industry at micro level
To analysis the industry at micro level here is support to porter five forces which is the
best and effective sources to achieve average profits which are compare by the other players in
industry in long term. With the help of porter’s five force model company and industry is able to
develop competitive strategy which is as follows:
 Threats of new entrants in industry are strong threat by new entrants at industry. In this
sector currently suppliers are able to earn lower profits for de crease threats by new
players who are entry in industry.
 Threats of substitute products in the consumer sector. It can be the threat in this industry
entry analysis has to be done by the Bicworld world Company (Lichter, Pestel and
Sommer, 2017). For that here make investment on R&D which is help to found products
which are same and substitute.
 Bargaining power of suppliers are strong buyers are higher prices from Bicworld world
Company. It can be impact to the potential buyer of the company which has maintained
above average profits in the suppliers.
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 Bargaining power of buyer of Bicworld world and consumers goods products in these
buyers are have strong bargaining power which has drive to the potential sustainable
profits.
 Rivalry is existing players in the industry like competition is high difficult for the
existing players for earn sustainable profits. The competitors such as Zippo which is the
private company (Hassidim, Romm and Shorrer, 2016).
Those are very import for analysis competitiveness which is faced by the Bicworld world in
industry. This help to understand the solution as per the nature and level of competitiveness.
2. Internal environment analysis.
To analysis the internal environment of whole industry here is use the VIRO chain
analysis. This model is resources based strategic analysis (Kharub and Sharma, 2017). This
provides opportunity for build sustainable competitive advantage or it rivals in the industry.
Analysis of VIRO are involves various factors such as values of the resources, rareness of
resources, imitation risk and organisation completeness. This model is focused on strategic
analysis tools. Those main resources of the Bicworld world Company which is the consumer’s
goods manufacture industry. This includes the various resources which are fulfilling the basic
and basic needs of customers. The resources are tangible and intangible resources. The tangible
resources are physical entity, land, building, plant, equipment and money. Other hand, intangible
resources are skills, administrative level of manger, goodwill, trademark and suppliers relations.
Resources Values Rare Imitation Organized
Financial resources Yes
Brand position Yes Yes
Intellectual property Yes Yes Yes
Corporate strategy Yes Yes Yes Yes
Valuable is the resources to industry goods which are creates values for the firm and
industry (Knott, 2015). Those are effective to achieve goals and objectives of consumer’s
goods. Those have effective and valuable like financial resources, human resources and
operation management.
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Rare is needs to ask the resources which are valuable to the rare for the industry and
Bicworld world company. Those are attaining costly and effective by present
competition and new entrants for access that.
Imitate most industries are faced problems by increasing threats. It has threat by duplicate
products of the company and industry and also their substitute products.
Organized competence is measures by the company which is harness to the valuable, rare
and difficult to imitate resources at market place.
This model is effective for the business and its growth as per best requirement of business.
3. The strategic analysis.
Strategic analysis is a process that is involves researching an organisation like Bicworld
world Company business environment within which it operates. This is essential to formulate
strategic planning for the decision making and smooth working of organisation is Bicworld
world .
Analysis of business level strategy
Organisation's cores competencies are focused on satisfying customers need or
preferences for achieve goals and objective of the company. Business level strategies are detail
action which is provide values to customers and gain the competitive advantage by exploring
core competencies in market. For the analysis of the business there are use cost leadership theory
(Mathooko and Ogutu, 2015).
Cost leadership business strategy
Cost leadership business strategy is sets the competitive advantage by having the lowest
cost of operation in the industry. This exploit scale of production, well defined scope and other
economic by using technologies. It is give the possible solution and answers to company for
compete with their internal and external environmental analysis. For example: technological
factors are very important for the company and its growth because by this manager of Bicworld
world can promote supply chain process by reducing operating cost of the business. By cost
leadership, company is getting to know about operating cost and its benefits to company and
whole industry. By this, company can sets lower price of product for compete with competitors
because many customers are wants low prices with the best quality of goods. That cost
leadership theory is help to analysis price of product in industry then sets lower from competitors
(McNamara and Moreton, 2016).
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Differentiation business strategy theory
Differentiation is theory which is used for made product different and unique in
competitive edge rather then set low price of products. This includes high quality, features, high
customer services, rapid product innovation, advanced technological features and also image
maintenance of the product. For example: social factor are affect to company and its growth at
marketplace. This is give negative impact on company growth. Social includes lifestyle of
peoples but it impacts new entrants in market with the best substitute product. At that, manager
of Bicworld world can make and introduced new product and services with unique feature
which is help to attract customers towards product and company to compete with substitute
product and services. With the help of this customers are highly attracted towards company. By
the differentiation, profit of company is increase and improved and customers are also loyal for
the company (Rothaermel, 2015).
Evaluation of strategy and its ethical implications
The SAF model is specifies the strategy for the business which is effective and difficult
for select the right. With the help of this this strategy is provide the usefulness and effectiveness
for the Bicworld world company. This includes suitability, acceptability and feasibility for
company are as follows:
Suitability
It is the probably and most important for the business and it growth process. The strategy
of Bicworld world company is promoting adoption standard of the business and its products as
per requirement. It is the suitability which is assessed in the numbers which are important factor
for this strategy model (Song, Sun and Jin,2017). Differentiation business strategy for promote
products and goods at marketplace which is generally assessed by criteria decided. As per the
porter's five forces analysis of industry in that, in order to compete with competitors here is
required to make unique and best product. By this customers are attracted towards the company.
Acceptability
These factors of SAF model is measuring return, risk and stakeholders reaction by the
particular strategy. Returns can be measures by benefits which are take by stakeholders from
strategy. Returns is the real options of the strategic flexibility from their work. Financial growth
is measures by financial which is depends on stakeholders decides. With the help of
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differentiation stakeholders are attracted towards the Bicworld and increase its profits margin.
(Takata, 2016). Other hand, risk is depends upon the failure of strategy and nay financial losses.
Feasibility
The feasibility aspect of this model is really made or break of differentiation strategy.
The business has the resources, aptitude and abilities to actually implement the strategy is the
key to its success. Eith the help of differentiation strategy Bicworld has funds flow forecasting
and break even analysis. At that company can develop their product and services for staying in
business and for competing successfully (Wills, Inkster and Milton, 2015).
for the growth of company here is mentioned some recommendations such as company
use differentiation strategy to promote their product and services at market. By making unique
products. For the higher growth company can provide at lower cost by this customers attract and
move towards. Recommendation for supply chain management use best technology with licence.
This help to eradicate hurdles by their supply chain.
CONCLUSION
From the above report it had been concluded that the PEST analysis has helped to know
about their competitors and make strategies for competed with them. Porters five force has
effective and valuable for company to get knowledge and information about their competitors
and suppliers. Internal analysis has best for the company by that have information which from
their rare products, limitability, organisation and its valuable products. By that company and
industry has able to make the changes for the company as per the requirements and also increase
profits of company. Differentiation business strategy model had been played an important role to
make product unique and different from their substitute products and analysis the price of
product and make or sets lower prices as compare with their competitors.
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REFERENCES
Books and journals
Adi, B., 2015. An evaluation of the Nigerian telecommunication industry competitiveness:
application of porter’s five forces model. World. 5(3). pp.15-36.
Bini, L., Dainelli, F. and Giunta, F., 2016. Business model disclosure in the strategic report:
entangling intellectual capital in value creation process. Journal of Intellectual Capital.
17(1) pp.83-102.
Chatzoglou and et.al., 2018. The role of firm-specific factors in the strategy-performance
relationship: Revisiting the resource-based view of the firm and the VRIO framework.
Management Research Review. 41(1). pp.46-73.
Hassidim, A., Romm, A. and Shorrer, R. I., 2016, July. Strategic behavior in a strategy-proof
environment. In Proceedings of the 2016 ACM Conference on Economics and
Computation (pp. 763-764). ACM.
Kharub, M. and Sharma, R., 2017. Comparative analyses of competitive advantage using Porter
diamond model (the case of MSMEs in Himachal Pradesh). Competitiveness Review:
An International Business Journal. 27(2). pp.132-160.
Knott, P. J., 2015. Does VRIO help managers evaluate a firm’s resources?. Management
Decision. 53(8). pp.1806-1822.
Lichter, A., Pestel, N. and Sommer, E., 2017. Productivity effects of air pollution: Evidence from
professional soccer. Labour Economics. 48. pp.54-66.
Mathooko, F. M. and Ogutu, M., 2015. Porter’s five competitive forces framework and other
factors that influence the choice of response strategies adopted by public universities in
Kenya. International Journal of Educational Management. 29(3). pp.334-354.
McNamara, S. and Moreton, G., 2016. Understanding differentiation: a teachers guide.
Routledge.
Rothaermel, F. T., 2015. Strategic management. McGraw-Hill Education.
Song, J., Sun, Y. and Jin, L., 2017. PESTEL analysis of the development of the waste-to-energy
incineration industry in China. Renewable and Sustainable Energy Reviews. 80. pp.276-
289.
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Takata, H., 2016. Effects of industry forces, market orientation, and marketing capabilities on
business performance: An empirical analysis of Japanese manufacturers from 2009 to
2011. Journal of Business Research. 69(12). pp.5611-5619.
Wills, A. J., Inkster, A. B. and Milton, F., 2015. Combination or differentiation? Two theories of
processing order in classification. Cognitive Psychology. 80. pp.1-33.
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