Developing Enterprise: Outsourcing Strategy for Morrison Report

This report provides a comprehensive analysis of Morrison's business plan for outsourcing its products and services to India. It begins with an introduction to the concept of outsourcing and its benefits, followed by a background on Morrison as a company. The report then delves into the specifics of Morrison's plan, including STPD and PESTEL analyses to assess the market environment, and a financial analysis with cost estimations for various resources and start-up expenses. Furthermore, the report explores Morrison's value proposition, product features, SWOT analysis, Porter's five forces, risk analysis, and competitor analysis. The conclusion summarizes the key findings and recommendations for the company's outsourcing strategy. The report highlights the importance of effective business planning, environmental analysis, and financial forecasting for successful international expansion, particularly within the retail industry.

Running head: DEVELOPING ENTERPRISE
Developing Enterprise
Name of the Student
Name of the University
Author’s Note

2DEVELOPING ENTERPRISE
Table of Contents
1. Introduction:................................................................................................................................4
2. Background:.................................................................................................................................4
3. Part 1: Business idea-outsourcing:...............................................................................................5
4. Part 2:...........................................................................................................................................5
4.1 STPD analysis:...........................................................................................................................5
4.2 PESTEL analysis:......................................................................................................................7
5. Part 3:.........................................................................................................................................10
5.1 Financial analysis:...................................................................................................................10
5.2 Cost estimation:.......................................................................................................................11
5.1.1 Cost estimation for using different resources:......................................................................12
5.1.2 Cost estimation for start-up business:...................................................................................12
Table 4: Start-up expense of Morrison..........................................................................................13
6. Part 4:.........................................................................................................................................13
6.1 Value proportion statement:....................................................................................................13
6.2 Product features and statements:.............................................................................................14
6.3 SWOT analysis:.......................................................................................................................15
6.4 Porter’s five force:...................................................................................................................16
Figure 2: Porter’s five force...........................................................................................................17
5. Risk analysis:.............................................................................................................................18
6.6 Competitors’ analysis:.............................................................................................................19
7. Conclusion:................................................................................................................................19
Reference List:...............................................................................................................................21

3DEVELOPING ENTERPRISE
1. Introduction:
Before starting outsourcing, business executives have to make an effective business
expansion plan. This particular study has provided an in-depth overview on how Morrison in
quest of outsourcing their products and services in the soil of Asian countries especially in India
has made an effective business plan. Retail industry is one of the fastest growing industries for
achieving international fame and reputation. Morrison has already expanded their widespread
wings in several regions of Asia. The business experts of Morrison have decided to outsource to
India for reducing internal cost. As a result, an effective external analysis has been conducted
for evaluating various political economic factors. An effective financial plan has also been made
in this very specific study based on which the business experts can make a proper budget for
expanding business process.
2. Background:
Morrison is considered as fourth largest supermarket chains of UK occupying a
predominant place in the International market. Food, drinks, books, magazines, CDs and DVDs
are the core products of Morrison. Around 132,000 employees are currently associated with the
organization. As of 2016, the company is occupied with 498 superstores all over the World. In
comparison to other continents Morrison is less available in Asian countries (morrisons.com
2018). Therefore, the business experts have decided to expand their entire business wings in the
market of India. Outsourcing is the process based on which the organization can expand their
product in India.

4DEVELOPING ENTERPRISE
3. Part 1: Business idea-outsourcing:
Outsourcing is one form of business practice where a particular company makes a
contract with other company for making their internal job function done by other organization.
Business experts instead of making an in-house department for controlling the business process
tend to contract with other company for exchanging services, expertise and payment (Giustiniano
and Clarioni 2013). As a result, the organization can reduce their cost of physical equipments,
labor as well as technology. The purpose of maintaining outsourcing is not only to reduce cost
but also to access skilled expertise, reduce overhead, flexible staffing and generate more profit.
As a result, the entire process of business can be controlled in a systematic way.
4. Part 2:
In this specific part an effective STPD analysis and PESTEL analysis is made. Before
selecting India as the soil of outsourcing, the business experts have collected an overview about
the political, economic social, technological and environmental aspects of India. On the other
hand, STPD analysis helps to differentiate the market as per segmentation, targeting, positioning
and differentiation (Gurung and Prater 2017). As a result, the business experts can get a clear
overview about the target group.
4.1 STPD analysis:
Segmentation:
Market segmentation is conducted as per geographic, demographic and psychographic
method. As per the geographic market, segmentation Morrison has targeted those groups of
people who belong to the areas of Asian pacific zone. Especially, localities belonging to India

5DEVELOPING ENTERPRISE
are the most wanted target areas for expanding the business of outsourcing. Demographic
market segmentation believes that target group should be segregated as per the income status age
group and gender of the people (Anwar 2013). As per the psychological background, Morrison
has targeted the people from every cultural belief and psychological backgrounds. As a result,
the organization has focused to draw the attention of the people of both urban and suburban. As a
result, large number of people is already targeted for using the products as well as services of
Morrison.
Targeting:
Morrison in order to expand their entire process of business has primarily targeted the
people from 20 age group to 40 age group. The business experts like to target both male and
female customers (Sanchís-Pedregosa and Palacín-Sánchez 2014). Therefore, the business
experts have launched diversified products and services so that it can be feasible for both male
and female customers. Morrison has achieved huge appreciation from the customers of various
geographical boundaries and attitudes due to their service equality.
Positioning:
In order to position the brand in the international market Morrison has decided to use
both traditional media as well as digital media. With the help of digital media, the organization
has drawn the attention of International customers (Jamil and Naeem 2013). On the other hand,
traditional media has drawn the attention of regional consumers of India. The marketing
executives focus to use social media sites for reaching the doorsteps of global consumers. On the
other hand, in quest of placing the brand in various localities of India the organization has used
billboards, hoardings, newsletters, and so on.

6DEVELOPING ENTERPRISE
Differentiation:
In order to enhance the range of target customers the organization has made a
differentiation between low cost customers and premium customers. Low cost customers are the
primary target for Morrison so that the organization can deliver their services to large number of
people (Vilko 2013). As per the ethical belief of this specific organization, the service providers
like to show equal respect and dignity to the people of various cultural backgrounds and
attitudes.
4.2 PESTEL analysis:
Before entering in a new market, the organizations like to make an effective
environmental analysis based in which the political, economic, socio-logical, technological,
environmental and legal factors are discussed.
Political  Government instability
 Systematic taxation policy
 Least chance of terrorism attack
Economic  Low economic strength
 Developing industries
 Raise of employability
Social  People of diverse cultural backgrounds
 Different socio-cultural people
Technological  Technologically growing up
 Sufficient technological equipments
Environmental  Instable weather and climate

7DEVELOPING ENTERPRISE
Legal  Well-maintained acts and regulations
 Systematic taxation policies
Table 1: PESTEL analysis of India
(Source: Lahiri, Kedia and Mukherjee 2012)
Analysis:
 Political:
India being one of the largest democracies in the World runs federal government. The
government policies of India are highly influenced by politicians’ interest. As a result,
government does not follow a systematic rules and policies (Dhar 2012). Morrison may have to
face difficulties in running their business effectively due to the lack of political stability. At the
same time, it is undeniable that Morrison Indian government likes to maintain a systematic
taxation policy. As a result, the business experts do not have to face difficulties in paying service
tax, income tax sales tax and so on.
 Economic:
India is economically developed country. For that very specific reason the organization
has targeted low cost customers so that people in average cost can purchase products as well as
services. In addition, after the reduction of industrial licensing, liberalization of foreign capital
and formation of FIBP the economic strength of India has been developed enough.
 Social:

8DEVELOPING ENTERPRISE
People of India are from various cultural backgrounds and attitudes (Han and Mithas
2013). Therefore, the organization like Morrison has to deal with diversified products and
services. As a result, people of different geographical backgrounds and attitudes can easily show
their interest in purchasing products of Morrison.
 Technological:
As per current scenario, India is facilitated with 3G and 4G technology, which has left
immense influence in the business industry of India. Morrison would not have to face challenges
for choosing India in order to maintain outsourcing. The business experts with the help of
technological equipments can easily control the entire process of business.
 Environmental:
Weather of India is a major challenge for industrialization and urbanization. However,
before launching their business wings Morrison would have to focus controlling environmental
pressure groups, noise pollution system as well as air pollution (Sørensen 2012). As a result, the
customers would not have to face challenges in availing the organization.
 Legal:
While running the business process the executives have to maintain a proper taxation
policy so that government does not get the scope of preventing the way of business (Kang et al.
2012). In addition, various the organization like Morrison has to maintain immense regulations
and acts such as data protection act, anti-discrimination act, right to information act, gender
equality act, health and safety act and so on.

9DEVELOPING ENTERPRISE
Figure 1: PESTEL analysis
(Source: McCarthy, Silvestre and Kietzmann 2013)
5. Part 3:
5.1 Financial analysis:
The function of business process outsourcing is to make an effective agreement between
two companies. Financial planning or budget estimation is highly needed in order to develop the
entire process of business. BPO provides customer services from various perspectives.
Therefore, the role of business experts is to make an in-depth financial analysis so that a proper
budget can be estimated (Benaroch, Webster and Kazaz 2012). At the initial stage, Morrison has
estimated very low budget for expanding their business in the market of India.
The various aspects for which budget should be made in order to run a BPO effective are as
follows:
License, permits and 60,000 (GBP)

10DEVELOPING ENTERPRISE
legal services
Maintenance of the
software of the BPO
40,400
Insurance policy 30,000
Salaries of the staffs 70,000
Renovation of the centre 40,000
Marketing promotion
expenses
60,000
Payment of the utility
bills
50,000
Buying office vehicles 50,000
Website launching 60,000
Miscellaneous 40,000
Total expense 5,00000
Table 2: Financial analysis
(Source: Created by the author)
5.2 Cost estimation:
Before making a business plan organizations have to make an effective budget based on
which the business experts tend to get an overview about the expense. A budget is made before
expanding the entire business wings. In this very specific part, the study has focused to make an
overview about the budget based on which the organization would like to prepare their marketing
plan.

11DEVELOPING ENTERPRISE
5.1.1 Cost estimation for using different resources:
Sources Amount (GBP) Amount(GBP)
Sources of income
Bank loan 150,000.00
Government Sponsorship 60,000.00
Total income 210,000
Sources of expenditures
Room rent 5,500.00
Taxes 2,000.00
Workforce 10,000.00
Advertisement 20,000.00
Electricity 4,000.00
Charges for administration 5,000.00
Other Equipments 25,000.00
Other maintenance 10,000.00
Communication expenses 50,000.00
Miscellaneous charges 3,000.00
Transport 15,500.00
Total expenditure 150,000
Surplus budget 60,000
Table 3: Cost estimation for using different resources
(Source: As created by the Author)
5.1.2 Cost estimation for start-up business:
Start-up expenses of particulars Amount (GBP)
Legal requirements 3,000
Leaflets 5,000
Consultants 195000
Insurance 1000
Room Rent 1000
Cost for renovation 1,500

12DEVELOPING ENTERPRISE
Charges for equipments 2,000
Salary for the employees 52,000
Others 6,000
Total expense 91,000
Required assets
Cash balance 500,000
Other form of short-term assets 8000
Total number of short term assets 508,000
Long-term assets 0
Total number of assets 508,000
Total requirements 598,000
Table 4: Start-up expense of Morrison
Source: (As Created by the Author)
6. Part 4:
6.1 Value proportion statement:
The overarching term value proportion refers to the business statement based on which
the company summaries why their products and services are superior to others. This particular
statement enables the business experts to analysis on which perspective the customer should
analyze the value of products and services (Teo and Bhattacherjee 2014). Some of the several