The primary purpose of this task is to outline and discuss the significance and role of porter dynamic analysis. Papyrus is a biggest developer and innovator of technology and materials. Papyrus was originated in 1994 to provide various products and services to the customer globally (Bloomberg, 2018). It further explains the porter five forces analysis and competitive strategies that help in grip the entire target market in a large extent. The business level strategy also has been explained in the task. More detail of the task has been detailed below.
Papyrus Australia limited is the developer of an innovative technology that translates the waste trunk of the banana palm into various alternatives to forest wood products to be used in the paper, construction, furniture, packaging, building and other industries. The company’s process uses renewable fibre source like banana tree trunk which is completely sustainable and effective. This process is also very environmental friendly and has vital and fundamental lower production or manufacturing costs when distinguished to comparable goods and products (Investment, 2018). After the various studies it has been found that estimated annual revenue of Papyrus is $3.4M and estimated employees are 104 (Owler, 2018).
It has been found that competitive analysis is an essential and empirical part of each and every company to cope up and strive with rivalries in the competitive market. The porter five forces model is a strategic tool and framework that helps in making decisions effectively and hassle free manner (Fernfortuniversity, 2018). By using this model, Papyrus has been able to build and develop a sustainable and effective competitive benefit in materials industry. Managers and leaders at Papyrus not only can use porter five forces model to build and improve a strategic brand position in materials industry but also may expand and explore profitable and unique opportunities in whole materials industry. The porter five forces analysis for Papyrus has been detailed below.
Threats of new entrants: It is stated that new entrants in materials and fibre bring innovation, new manner and ways of doing things and put pressure on the company through lower pricing strategy and minimizing the costs widely. It has been found that the company should tackle all these challenges and issues and develop effective barriers to maintain its competitive edge. The threats of new entrants can be managed by developing and building economies of scale so that it can lower and reduce the fixed cost per unit. Aside this, Papyrus needs to invest money on research and development to gain competitive advantages in the international market. It further minimizes the window of extraordinary profits and revenue for the new organizations thus discourages new leaders in the industry (Fernfortuniversity, 2018).
Bargaining power of suppliers: It is stated that mainly Papyrus company purchases their raw material and fibre from ample of suppliers. In this way, the suppliers are in dominant position that can reduce the margins of the company in the market. The strong and powerful suppliers in agribusiness sector use their negotiating power to extract higher prices from the companies widely. Therefore, suppliers keep high and strong power in the hands thus, reduces the overall profitability and revenue of company. The organization should develop an effective and unique supply chain with various suppliers (Fernfortuniversity, 2018).
Bargaining power of buyers: It is portrayed that bargaining power is high in the hands of customers globally. They want to buy the best products at minimum prices. This may affect the growth and success of Papyru Australia limited. The customers want some special discounts and offers to take ample of benefits. The company should improve and develop a large base of buyers to reduce the high bargaining power of customers. Aside this, the company needs to focus on new and innovative products to reduce and handle the high and strong bargaining power of buyers globally. New and innovative products will help in minimizing the defection of existing or current customer of Papyrus Australia limited to its rivalries (Owler, 2018).
Threats of substitute’s products or services: Industry will be suffered if a new service or product meets a similar customer needs and requirement in various ways. The threat of substitutes is high in agribusiness sector. If the company offers a high value proposition that is quite different from the existing offering of the firm then threat of a substitute would be high and strong. Therefore, it may put direct impact on the progress and targets of the organization. The company can tackle the threat of substitute by increasing and enhancing the switching cost or price for the customers (Owler, 2018). The firm should be a service oriented instead of just product oriented.
Rivalry among the existing competitors: If the competition among the existing players is high and intense then it would drive down prices and reduce the overall profitability and revenue of the industry. It has been analyzed that Papyrus Australia limited manages and operates in an effective and unique competitive materials industry. This competition does take toll on the revenue and profitability of the firm. The Corporation can tackle or handle the high and intense rivalry among the existing rivalries by building and boosting a sustainable differentiation. Aside this, the firm needs to collaborate with rivalries to increase and enhance the market size rather than opposing for small market. The main competitiors of Papyrus include Mixbook, Mpix, tinyprints, Postable, home, Shutterfly and Vistaprint. Papyrus needs to keep an eye on the policies and strategies of the competitors to stand out against them (Owler, 2018).
There are ample of competitive strategies that can be used by Papyrus to beat the competitors globally. Sustainable competitive benefits can be taken with the help of ample of competitive strategies. There are enormous competitive strategies that have been discussed below.
Cost leadership: Cost leadership is very complex for agribusiness sectors to initiate because it requires long term commitment for selling the fibre and materials at reasonable prices. Therefore, various challenges and issues would be faced by the firm while selling the products or services. This strategy suggests that the company needs to set the appropriate prices for each and every product in agribusiness sector. It is stated that a low and unique cost producer should find and exploit all sources of cost benefits. If Papyrus wants achieve rivalries benefits then it should focus on the cost leadership strategy (Owler, 2018).
Differentiation strategy: It is essential that Papyrus needs to identify and analyze an aspect or characteristics that makes material and products quite unique and effective as compared to the rivalries. By using differentiation strategy, the firm has been able to distinguish its products from the rivalries globally. Along with this, if Papyrus is able to distinguish its products and services in the minds of the several buyers, it can grab the rewards and some other benefits. Differentiation strategy helps in making a dynamic and unique image in the eyes of the customers.
Cost focus strategy: The cost focus strategy is similar as the cost leadership strategy. The cost focus strategy helps in offering the materials and fibre at reasonable prices in the global market. If the firm sets the lower prices of the products then it can take ample of benefits in the international market. It is one of the significant and imperial competitive strategies that helps in achieving the long term goals and purpose.
Differentiation focus strategy: In this strategy, the company offers some unique and effective products and services that are completely different from its competitors. This strategy makes products and services unique and dynamic to attract and retain the maximum number of customers.
(Source: IFM, 2018)
The business level strategy may be defined as actions taken to render value to the various customers and attain rivalries advantages. This strategy helps in gaining rivalries advantages by exploiting and core capabilities in individual, and specific product and service in the marketplace. These strategies also help in eliminate and prevent competitors in the international market. The firm cannot survive and grow its business without using porter generic strategy. This strategy generally helps in gaining rivalries benefits in the market.
Conclusion
It is concluded from the above mentioned limelight event that Papyrus is one of biggest and reputed brands across the world. It is noted from the above study that Papyrus is an e-commerce platform or route that permits users to gift cards, wraps, bags, and customs. The above analysis shows that how top management and managers use various competitive and business level strategies to cope up with the competitors in the global market. The paper shows that Papyrus uses ample of business level strategies within the organization. The above analysis indicates that how porter five forces model is used by the company to grab the various competitors and capture the entire target audience. It is recommended that the company should also focus on the promotional and advertisement strategies to attract and retain maximum customer globally. The company further should make unique and effective strategies to beat the competitors.
References
Bloomberg.2018. Company overview of Papyrus Australia Limited [online]. Available from https://www.bloomberg.com/research/stocks/private/snapshot.asp?privcapId=22071470 [Accessed as on 15th September 2018].
Fernfortuniversity.2018. Papyrus Australia Limited Porter five forces analysis [Online]. Available from https://fernfortuniversity.com/term-papers/porter5/asx/1283-papyrus-australia-limited.php [Accessed as on 14th September 2018].
IFM.2018. Porter’s generic competitive strategies [Ways of competing] [Online]. Available from https://www.ifm.eng.cam.ac.uk/research/dstools/porters-generic-competitive-strategies/ [Accessed as on 14th September.
Investment.2018. Papyrus Australia Limited [Online]. Available from https://www.investsmart.com.au/shares/asx-ppy/papyrus-australia-limited [Accessed as on 13th September 2018].
Owler.2018. Papyrus’s competitors, Revenue, Number of employees, Funding and Acquisitions [online]. Available from https://www.owler.com/company/papyrusonline [Accessed as on 14th September 2018].
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