Business Strategy Evaluation: Uber Eats and Macro Environment Impact

This report provides a comprehensive analysis of Uber Eats' business strategy, focusing on its operations during the COVID-19 pandemic. It begins with an introduction to business strategy and an overview of Uber Eats. The main body of the report assesses the impact of macro-environmental factors using PESTLE analysis and Ansoff's growth matrix, evaluating their influence on the company's strategies. It then delves into the internal environment, utilizing the VRIO model and resource-based view framework to evaluate the company's capabilities, strengths, and weaknesses. Porter’s Five Forces are applied to identify competitive forces in the market. Finally, the report formulates strategic planning using various theories, concepts, and models, culminating in a set of strategic directions, objectives, and tactical actions. The conclusion summarizes the key findings, offering insights into Uber Eats' strategic approach and adaptability.

Evaluating Business
Strategy in the
COVID-19 Pandemic

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
TASK 1............................................................................................................................................1
P1 Assess the impact and influence of macro environment factors and explain the strategies1
M1 Evaluate the macro environment and determine the strategic management decisions....3
TASK 2............................................................................................................................................4
P2 Using appropriate framework evaluate the internal environment and its capabilities of the
company.................................................................................................................................4
M2 Evaluate the internal environment and assess the strengths and weaknesses of an
organisation’s internal capabilities, structure and skill set.....................................................6
TASK 3............................................................................................................................................6
P3 Identify the competitive forces in the market using Porter’s Five Forces........................6
M3 Develop strategies which is used to improve competitive edge and market position.....7
TASK 4............................................................................................................................................8
P4 Using different theories, concepts and models formulate strategic planning for the
business...................................................................................................................................8
M4 Make strategic management plan which has tangible and tactical strategic priorities and
objectives..............................................................................................................................11
D1 Apply environmental and competitive analysis to develop a set of valid strategic
directions, objectives and tactical actions............................................................................11
CONCLUSION..............................................................................................................................12
References:.....................................................................................................................................13

INTRODUCTION
Business strategy refers to the directions and actions which are prepared for achieving the
business objectives. It is similar to business planning where the owner of the business makes the
plan and sets out the direction which will be helpful in achieving success and gaining
competitive position in the market(Kozmetsky, 2019). When the businesses prepare good
strategies it helps them to remain profitable for the longer term and helps in avoiding the
mistakes which they might face in achieving the objectives. This helps the business in
developing the skills and technology which might be needed to develop in the coming time. Uber
Eats was started in 2014 having its headquarter in San Francisco. It is an America online food
delivery and ordering online platform which provides the food delivery to people. This company
is operational in 32 countries as the trends and demands for such delivery companies of food are
increasing day-by-day. This report will cover the impact and influence of macro environment
factors on the business and its business strategies and also the explanation of internal
environment and its capabilities. In addition with this the report also covers the outcome of
Porter’s Five Forces in a given market sector and the application of models, theories and
concepts to understand the interpretation of strategic directions available with the business.
MAIN BODY
TASK 1
P1 Assess the impact and influence of macro environment factors and explain the strategies
Macro environment are the external factors which has a direct impact on the success of
the business and which are difficult to control (Wang, Wei and Guo, 2018). There are many
factors which can influence and impact the working of Uber eats if not controlled early. The
factors are explained using different models-
PESTLE analysis-
PESTLE analysis is a tool which is used by the companies to track the outside factors in
which they are working. This helps them to know whether all the plans or innovation which they
are coming up will give them profits or success.
Political factors-Nowadays governments are taking strict watch on the companies who are
delivering food to ensure that people are eating good and hygienic food. While the
government is now ensuring that people eat more healthy and nutritional food and avoid
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eating junk foods. If any of these policy will be regulated it will be difficult for the
company to regulate their business. Compared with Uber eats the delivery is not for
healthy food but also includes junk. Governments have set tight regulations for following
the safety and standard rules after which if any company is seeing not following such
then they can face the trouble of heavy fines.
 Economic factors-The growth of Uber eats have achieved a significant height in which
the company is able to build more than what they have expected which is increasing the
GDP of other countries as well (Frouz, 2018). The company has provided the delivery of
food at reasonable rates which has led to success.
 Social factors-Customers are much more happy about the services and the discounts
which are provided by the company. The delivery of Uber eats is fast and the price at
which they are offering food is also reasonable. Thus, adding more customers will be
added with the company.
 Technological factors-Uber eats is run on the application where the orders for food is
taken. Company usually brings some or the other changes in its applications which brings
easiness and simple to use by any person. The application is very important for the
company as the whole working is conducted with the help of the Uber eats application
only.
 Environmental factors-The company is basically providing the service to the people and
is not carrying any issue or problem with the environment (Sagi, Zaguri and Hawlena,
2021).In fact as the use of plastic is ban in many countries the company uses reusable and
recyclable carry bags to deliver the food to the customers which are not harmful for the
environment.
 Legal factors-There are certain laws which have to be followed by every companies if
they are doing any business in any country. There are various safety standards which the
government of every country has made to those companies who are operating their food
business and to those who are delivering this food to people. Consumers always have
trust on the companies for which they pay and expect that the food which will reach out
to them will be of quality and the delivery for neat and hygienic has been taken care.
Ansoff’s growth matrix-
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This model is all about the strategies which the business can make for achieving the
growth. There are four strategies which are mentioned in this model which is explained below-
 Market penetration- This strategy aims to achieve growth in the existing market where
they are operational from many time. This means to increase the growth by using same
market with the same products(Belias, Vasiliadis and Velissariou, 2020). If Uber eats will
add more employees in their business for delivering the food it will increase the
productivity and more people will be added. The company can also advertise and provide
effective communication with the consumers so that more people become aware.
 Market development-This strategy means to work in the same manner but in new
markets. Uber eats have already expanded its business in new countries and is working
according to culture and trends of the particular market. They conduct proper research to
check in which new area they can achieve growth.
 Product development-Product development means to come up with new products in
existing market. Uber eats tries to identify what new the customers want not only to ease
the application but also in the services which they provide.They know that consumers
requires quick service to deliver the food and more things which they are trying to
identify.
 Diversification- Diversification means to come up in new markets with the new
products or new services(Chevallier, 2020). This might be a riskier challenge as they
don’t have any idea whether it will be successful or not as they are new for the market.
Uber eats have come up in new markets and also trying to expand its operations with the
trends and demands of the consumers.
M1 Evaluate the macro environment and determine the strategic management decisions
Macro environment are the external factors which can influence the company competitive
strength. These factors are difficult to control and if proper regulation and check on these factors
are not kept by the company then there are chances of low growth and success in the market.
Uber eats have followed all the government rules and regulations in providing the services to the
consumers and have developed its own food standard. Uber eats have made many changes in its
application so that they become different from their competitors and so consumers also build
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trust with the company.Uber eats can also made technological improvement in their services
where people can book the food for a particular day or for small event at homes.
TASK 2
P2 Using appropriate framework evaluate the internal environment and its capabilities of the
company
Internal environment is the factors which exist within the framework of company and
impact the business directly(Shi and Liu, 2020). But such factors can be controlled if the
company top management identifies the issue which is crating hurdles and impacting the
business. This can be explained by using VRIO model in context with Uber eats-
VRIO model-
This model is used to make the internal assessment of the company to identify whether
the resources and other factors could be helpful in attaining business competitive advantage. The
explanation of this model in context with Uber eats is mentioned below-
 Valuable- This is to identify whether the resources which are used by the company will
be helpful in identifying the opportunities and will reduce threats (Park and Tran, 2018).
When such things are provided by the resources then it will be considered as valuable.
Uber eats have always tried to use resources at their best and are able to build the
consumer trust with the company. This is the reason why company is considered to be
valuable in terms of maintaining good relations with the consumers.
 Rare- Rare means those resources which are scarce and are used by only particular
companies. This makes the competition less as the company have resources which
cannot be used by others. Uber eats resources are not rare in the sense that the company
operates onapplication which is used by other companies also. This leads to huge
competition in the market.
 Imitate- This means to identify that whether the resources which are used by the
businesses can be copied by others or not (Kovács, 2019). If no than the company gain
competitive advantage in the market and it is possible that company might generate their
monopoly. Uber eats resources can be imitated by other companies which increases more
competition and the company can only achieve growth when some innovations can be
come up.
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 Organization-In this last stage it becomes very important for the company to manage the
management, culture and structure of the company if they want to achieve growth. Uber
eats have always developed good working culture, effective management and good
policies for the employees because they know that they are the one who can build the
importance of resources.
Resource based view framework-
This model is based on the view that how the resources if effectively used can lead to
higher growth and success for the company (Sun, 2020). The main aim is not to identify the
competition and develop ideas to reduce threat but it is to identify the resources which the
company is having and to gain the competencies in the market. According to this model there are
two types of resources which are explained below-
 Tangible assets- These are the resources which can be touched and can be
seen.According to this model, if the company acquires such resources than it would be
easy for other companies to acquire the same. Uber eats have some of the resources
which can be the vehicles for delivering the food and many more.
 Intangible assets-It is the opposite of what has been said above that is those resources
which cannot be touched and does not have any physical existence. This can be the
reputation, trade mark or other .Uber eats have built its reputation over the time and
people have built their trust with this company.
Apart from this, there can be two more resources-
 Heterogeneous- This includes the resources, talent and skills which every company has
their own and different. This is what the companies can take advantage of and develops
the best strategies(Porter 2019). Uber eats have always been different with the resources
and strategies which is why the company has achieved success in the market.
 Immobile-This means that resources cannot be moved from one place to another very
easily or at a shorter period.This makes it difficult for them to copy the strategies and use
it for themselves.
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M2 Evaluate the internal environment and assess the strengths and weaknesses of an
organisation’s internal capabilities, structure and skill set
Internal environment means the internal factors which will be responsible for the
company gain and loss. These factors are under direct control of the management and if some
focus and care is undertaken by the company then all the resources for the company will be
beneficial for them. The major strength of Uber eats is their riders who deliver the food from one
place to another and sometimes for 24/7. Proper treatment and fair salaries makes the riders more
motivated to work hard for achieving the company’s objective. The major weakness is their
application which sometimes stops working or no delivery from particular restaurants at festive
time (Blondiau Glazer and Proost, 2018). The company have lot of capabilities but proper
management of the company can bring good success and also the structure of the company is
well defined and proper which helps the employees to know which position they maintain.
TASK 3
P3 Identify the competitive forces in the market using Porter’s Five Forces
Porter’s five forces is a very important tool for the business to identify and analyze the
competitive environment in the market. When companies know their competition they will
develop their strategies according to it for the survival in the market. Porter have provided five
forces which can impact the company competitive position which is explained below in context
with Uber eats-
 Threat of new entrants- The arrival of new business could be a threat when the entry in
a particular industry is quite easy.New entrants come up with new products and with
some new innovation which might be a threat for the existing companies(Poorani and
Thiyagarajan, 2018). Uber eats when came up there were some existing companies
which were delivering the food and the companies which are coming up in the market to
beat the Uber eats is a point of threat for the company. But the services and new changes
which are offered by the Uber eats cannot be copied as the company have employed
talented and productive people.
 Bargaining power of buyers- The buying power of the buyers are strong because there
are many companies which offers the same services which the Uber eats provides.This is
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because the buyers can choose some other company for delivering the food. This could
be because of higher prices, late delivery and unhygienic delivery packets. Therefore, the
company has to check up in all these points if they want to gain the customer trust and
loyalty. Uber eats have always provided different offers and discounts including with fast
deliveries.
 Bargaining power of suppliers- The company basically deals with the online food
delivery services and the main thing by which the food is delivered is its application. The
company has full control on the application which they have developed. Also, the riders
which delivers the food are employed by the company itself (Chim-Miki and Batista-
Canino, 2018). Thus, it is clear that the power of suppliers is very low. It might be
possible which is not also sure that the restaurants and other cafes in which the company
has its link might stop working with the company.
 Threat of substitute product-The companies which delivers the food to people, their
main linkage is with the restaurants which delivers the food to them. But this would not
be possible because the company itself offers them various service and profits. It will be
difficult for the restaurants itself to engage the contractor for the delivery of food. Hence,
the threat from the restaurants to Uber eats would be low.
 Rivalry among existing competitors-There are lots of competitors who can compete the
company in the market. This is the only reason for the biggest threat that if company will
not make their prices low, the consumers can choose different company.Uber eats have
come up with new services and innovations in its application itself which makes it easy
for the consumers also.
M3 Develop strategies which is used to improve competitive edge and market position
The company has developed various strategies and have come up with different policies
to serve their customers be (Porter, 2018). Various competitive factors have been identified by
the company which will help to stay for the longer time and achieve competitive position in the
market. The main threat for Uber eats is the entry of new entrants in the market as to enter in this
industry is quite easy but high investment is require .Uber eats tries to make more marketing
campaigns and advertise the company so that more consumers are added in the company. Uber
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eats also tries to make the delivery service at a very reasonable rate as they know that they can’t
keep it high due to other companies which exist in the market with same profile. The reasonable
rates, humble delivery person and the fast delivery makes to them stand out from their
competitors (Goggins, 2018).
TASK 4
P4 Using different theories, concepts and models formulate strategic planning for the business
Strategic planning is the strategies or the plans which the companies make to achieve
success.Some models are explained below in context with Uber eats-
Bowman’s strategic clock-
The model explains the position of the company in the market compared with that of its
competitors . This means how the company can stand out its services in the market on the basis
of two dimensions which is the price and the second is value of the service or product.There are
8 strategies which the companies can use to position themselves in the market which are
explained below-
 Low price and low added value-In this the price of the services which is offered by
Uber eats has to be low which will help to gain higher competitiveness. But consumers
will formulate very little value for the service.
 Low price- The main focus of this strategy is to come up with low prices but the service
has to be given in large quantity to the consumers (Yang, Jiang and Zhao, 2019). Uber
eats sometimes offers low prices or discounts in the food which attracts many consumers.
 Hybrid- Hybrid means when the value which is offered by the company is consistent in
nature which helps to increase the goodwill of the company. This can be achieved when
there is some innovations and differentiation in the offering (Padmanabhan, 2018). Uber
eats have always offered something new in their services.
 Differentiation- Thiscriterion is about offering at low prices and that too with much in
amount and with quality. This also adds the value which has to be provided with the
consumers. Uber eats have always offered their services at low prices which make them
good towards the consumers.
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 Focussed differentiation- This strategy is basically for those companies who sells luxury
and unique products which are rich in quality. So, the profits of these companies are also
high because they invest their huge money on branding and in advertisement. Uber eats
have now become the top most company because of the services which they offer.
 Risky high margins- This is a very risky and challenging option for the companies
which charges higher prices on the services which they offer .Companies usually in the
long run fails to hold position in the company because consumers always opt for those
products which are less in price.
 Monopoly pricing- In this the company holds the monopoly position in the market as
there are no other companies who will sell the same product (Centobelli, Cerchione and
Ertz, 2020). Uber eats does not hold any monopoly in the market because there are other
similar companies which works in same terms like the Uber eats does.
 Loss of market share- In this the companies usually lose their market share because they
serve the products and services to the consumers at higher prices. They does not focus on
the value is being provided with every purchase. Uber eats have not followed this
strategy as they believe in delivering the food at reasonable prices. But company charges
higher prices during the time festivals and in many occasions.
PORTER generic strategies-
Porter’sgeneric strategic framework, was introduced by Michael Porter in 1980. The
model explains how companies can pursue competitive advantage by choosing appropriate
strategies. The framework focuses on three key strategies - cost leadership, diversity and focus.
The most used generic strategy by the Uber is mix of the cost leadership and technology based
differential. Which can be further explain below-
Cost leadership strategy-Cost leadership can be a source of sustainable competitive advantage. it
works to keep the popularity of Uber services high because everyone wants to save money and
Uber is offering the lower price in compare to other traditional taxis.. In addition, by adding
convenience to the services, the brand has been able to produce a higher level of popularity and
image of a better product (Abbasghorbani, 2018). Moreover, cost leadership strategy was being
useful for Uber because following strategy fascinate them to expands the market share by
targeting the middle class people which are larger part of country population .Middle class
people are more price conscious and cost leadership strategy backs high significance to Uber
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because price is crucial factor and when business adopt cost leadership strategy they were
meeting the needs of the every consumer segments. Further, cost leadership strategy comes with
the many benefits to Uber such as earning rapid brand recognition, stretching the customer base
and promoting the business and expansion of the sales by targeting the customer through its
product affordability nature and ease of availability to all customer segments.
 Differentiation strategy
Uber’s strategy for using this strategy is to differentiate with new embedding and address
growing consumer demands, mainly differentiation strategy of Uber is purely based on the
technology differentiation. For example, Uber has expanded its product line after studying the
changing consumer interests to differentiate themselves from competitors and expand the range
of opportunities within the industry. The combination of separation and cost leadership has
helped Uber build a strong and loyal customer base.By differentiating the standard strategy, Uber
ranks its product in a unique way and differs from other available methods. Being a
knowledgeable product with strong foundations, the company uses the differentiation as a tool to
reduce the pressure of other products.
Technology-based segregation is also a major source of competitive product profits. Technology
is what helps their services and plays a key role in the model of their business. It is an Uber app
that connects passengers and taxi drivers, allowing them to pay for services and evaluate their
ride and ease of use (Liu, Zhu and Zhang, 2018) . Technology based differencing strategy offer
greater customer usability here and it becomes an important factor in distinguishing a product.
As the level of usability is high, .it adds quality to the service and therefore becomes a source of
competitive business profit. Cost focus strategy
Uber adopts this strategy to focus both on low cost and offers the best value. The low-cost
strategy is adopted by providing the needs of the niche market segment at a very low price.
While, a high value focus strategy is adopted with an emphasis on taste, size and product design
that best suits the needs and requirements of the customers.
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M4 Make strategic management plan which has tangible and tactical strategic priorities and
objectives
Company overview- Uber eats is an American food delivery company which delivers the food
to the people. It works on one application where people can check out the menus of the
restaurants, their prices and the options for making the payment. The company follows all the
safety and standard rules for delivering the food. But during the COVID- 19 pandemic the
company was criticised because of charging high prices from the people.
Vision- The main aim of the company is to become the largest food delivery company in the
world with more employees and more customers. Their main focus is on the consumers to
provide them food on time and the qualitative services.
Mission-Their main mission is to reduce the transportation cost of the vehicles and on the other
hand to develop more links with the restaurants. Uber eats wanted to develop a friendly
environment for the employees and the riders as helps them to be more motivated and indulged
with the company
Strategies-Uber eats have worked on many strategies to gain consumer trust and to gain
competitive advantage in the market .The company has worked on their marketing and the offers
and discounts which they provide to every user. The services are very excellent and are on time
delivery with humble and polite delivery persons.
D1 Apply environmental and competitive analysis to develop a set of valid strategic directions,
objectives and tactical actions
The company have used different strategies to build their market share and value
for developing unique position in the market and for the services which they offer. Compared
with keeping the low prices Uber eats have always tried to keep the prices of their services in
low and have always tried to make their services good (Agwu, 2018). The competition for the
company is high as many new entrants have come up for which the company is coming up with
new policies and innovations.Their major aim is to become the top most food delivery service
company and to provide value to their customers.
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CONCLUSION
From the above report we can conclude that preparing business strategy helps the companies
to be competitive as the strategies are developed for a longer tenure. This provides them the
roadmap to conduct their activities in a systematic manner. Also, when no plan or the strategy is
made for the resource allocation companies have to face issue in this aspect.However, making
strategy helps in allocation the resources in efficient manner and knows the requirement if the
company needs further. As the market is dynamic and so also the requirements of the market are
changing the company has to be prepared for all the challenges and opportunities and sometimes
have to come with innovative idea needed in the market. This whole thing could be possible only
when the companies plan their strategies before implementing them.
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References:
Books and Journals
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