The strategy of a company considered as long-term objectives and goals which are adopted for the organisational growth and success. The long-term strategic decisions of an organisation develop scope and advantages for the company in the changing business environment. In this report, the strategic analysis for the next 3 to 5 years of the Appliances Online situated in Australia will be done.
Appliances Online is associated with the core activities of selling their products to more than 300,000 Australians. This company also provides a replacement service for white goods and appliances immediately. The prices of this organisation include dryers and washers, freezes, dishwasher, Sinks, ovens, electronics, small appliances, cooling and heating appliances, BBQ’s, etc. (Amaldosset al. 2015).
The second Horizon strategy includes the new activities for increasing the organisational profit. Within Sydney, the company gives free delivery, but for the rest of the Australian cities, the company applies charges for their delivery (Appliances Online, 2018). Therefore; for the organisational growth and profit margin extension, developing their delivery service could be more profitable in generating new sources.
The strategic option for the future has to think higher risk activities which will generate growth in the future years. Creating the third Horizon, the company is trying to expand their business in New Zealand for achieving a new market for their internet based retail business.
The web based retail shop is aiming at providing customers a 24-hour service with for satisfying those (Bondarenkoet al. 2017). For that, this company is using the Australian post as their part of the delivery and also employees who are associated with the installation of most of the products and the disposal of old appliances discounted within the organisational mission.
The vision is to expand business and number of customers rather than Australia in the future years.
The three-level strategy which is part of this business of Appliances Online is:
Corporate level strategy-the corporate level strategy is associated with developing little privacy activities for which Appliances Online is developing their delivery service for the rest of Australia.
Business level strategy- for maintaining the current success in the Australian market, the organisation is focusing on improving their service quality for which is introducing its employees to the customers who can directly understand (Bull et al. 2016).These problems of the customer help in the process of removal or disposal of all appliances.
Functional strategy- The practical strategy includes providing 24-hour services to the customers for developing the organisational profit and reputation (Daellenbach, 2015).
This strategic Framework mainly focuses on three type of strategies; strategy position, certificate charges and strategy in action. The strategic position refers to the current procedure which includes the organisational culture, stakeholders, industry, and microenvironment sources of Appliances online. The strategic choices refer to the future planning which includes the process of business strategy, corporate the strategy in activities related to the current management procedure (Doppelt, 2017). It includes the leading and changing scenario, processes, organising and practice of Appliances Online.
After evaluating the exploring strategy of a different context, it has been understood that this organisation is mainly associated with strategic issues, growth issues and retaining independence (E. Dobbs, 2014).
The three branches of the strategy include the context, content and processes. The contacts of include both the internal and external environment of Appliances Online. The various strategic options which are already selected as part of the strategy are considered the content. Besides that, the processes include the formation of this company and the various process of implementation (Gollayet al. 2016). The total activities are related to the purchasing of the goods and products, providing services for the old appliances and also the after delivery services given by this organisation are counted under the process.
The strategic position of is related to the potential environment and strategic capability. In addition to that, the ambition of Appliances Online is dependable on the strategic purpose and culture. This company is related to the multiple layers of the business environment (Hill et al. 2014). In the first layer, the organisational market is situated where the competitors like Amazon, eBay are getting stronger every day. In the next level, the industry order web based electronics and appliances selling industry is situated. Finally, the Third Level, microenvironment is differentiated into three different segments. Those are the pestle analysis, the forecasting and the scenario analysis significant within the microenvironment (Jarzabkowski and Kaplan, 2015).
Political factors- Appliances Online is an internet based retailing organisation who are associated with both selling the products and providing services, but the political factors like the change of government or taxation chart changing can impact on organizational growth process.
Economic factor- at the time of recession of 2008, Australian organizations are successful in maintaining the industries (Jian-hua et al. 2016). The inflation rate minimum in this organisation and the other economic factors like interest rates, the unemployment rate will not affect this company.
The social factor- The Australian population is associated with a modern lifestyle where the services like Appliances Online support their lifestyle. The income distribution and changes in culture will not affect the Australian market.
Technological factor- The contribution of technology is high from the advanced market of Australia because most of the service process is related to the technology (Knott, 2015). Therefore the change in Technology will affect this association’s activity.
(Source: Knott, 2015)
Ecological factors- The activities of this organisation are partially related to the environmental issues. The disposal of old appliances of the customer is part of the ecological factors which need to maintain by this company for maintaining the reputation and growth.
Legal factors- the change of governmental policies and regulations can affect this association. The legal system of Australia has some specific rules and regulations related to the taxation or competition regulation in the same market (Mathooko and Ogutu, 2015). Small changes in the legislation area will impact this organisational strategic decision.
For the future strategic decisions, the use of forecast and scenarios are significant. For this company, the possible forecast is the range forecast. Appliances Online uses this forecast system, and the less certainty is observed from the possible outcomes. The probability and Centre projection will help in identifying the most probable forecast (McDONALD, 2016). The scenario analysis is not needed because it is required when the alternative future forecasting process is identified for analysing the future.
The existences of rivalry- Appliances Online are not the only web based appliance selling organisation. The big and strong Rivals like eBay and Amazon is also part of the same industry and market. The impact of this force is high.
Bargaining power of buyers- This is a customer-oriented company, and the bargaining power of the buyer is less effective because it offers a fixed price for the customers (Papulova and Gazova, 2016.).
Bargaining power of the suppliers- the bargaining power of the suppliers is moderately part of this organisational strategic decision. This company has multiple suppliers the effect is moderate.
The threat of new entry- the internet based industries are still going every single day the introduction of new companies which are part of the daily process. Therefore, the threat of new entry is considered as a moderate force.
(Source: Rauch et al. 2015)
The threat of substitute- the association is associated with supply appliances to their customers, and there is the number of substitute products in the market. Therefore, the threat of substitute is counted as a low impacting force for Appliances Online (Rauch et al. 2015).
Appliances Online is currently using the demographic segmentation as part of the market segment selection. But for the future strategic decision, the psychological and demographic segmentation of the market will be selected as part of the strategy. The demographic segmentation will help in achieving the market by focusing on the age, gender, race, ethnicity, etc. (Rothaermel, 2015). But the process of psychological segmentation will help the organisation in achieving the market where the customer purchases the products depending on the effectivity of purchasing. In addition to that, the variation of the customer need will be the main focus for the long-term segment strategy.
The main resources of this company are the financial resources, human resource and this organisational physical resources or products (Singh et al. 2018). It has millions of customer all over Australia. Therefore, the financial resources for the future plan will be used for the profit of previous years. The human resource is essential because they are directly connected to the customers. Finally, the end products of the association include all the appliances used for personal and professional industries.
Value- the Australians are associated with the business procedure of Appliances Online for more than ten years which have helped in creating brand value in the market (Tan and Carrillo, 2017).
Rarity- the products are not rare, but the services provided by this company are rare in this industry. This company provides after sales services to the customers as well as the disposal or replacement of the old products is unique and rare service.
|
Value |
Rare |
Imitable (Costly to imitate) |
Organised |
Competitive advantage |
|
|
Technology |
Yes |
Yes |
Yes |
Yes |
Sustained competitive advantage |
|
Products and services |
Yes |
No |
Yes |
Yes |
Competitive parity |
|
Human resource |
Yes |
Yes |
No |
Yes |
Temporary competitive advantage |
|
Finance |
Yes |
Yes |
No |
Yes |
Competitive parity |
Inimitability- For the competitive advantage the unique resources of products and services are somehow developed inimitable capabilities (Yunna and Yisheng, 2014). But in this case, the resources such as human resource and finance can easily imitable by the competitors.
Organisational support- for the process of maintaining value of resources, rarity, and inimitability, proper capabilities are needed an appropriate for the system. In this case, Appliances Online has these capabilities (Amaldosset al. 2015).
In the process of stakeholder analysis, it has been seen that the most important stakeholders of this organisation are the Government of Australia, the customers, the employees and the suppliers. The internal stakeholders include the employees and managers. But the external stakeholders include the shareholders, suppliers, government, host communities, etc. (Appliances Online, 2018).
Appliances Online is associated with maintaining the corporate governance and can easily identify from their services of old appliances disposal activities. Instead of that, this company has the business ethics which include the various legal framework of Australia (Appliances Online, 2018). However, for the maintenance of corporate governance, the organisation has focused on its organisational structure and use the principal-agent model as part of the organisational corporate governance maintenance.
The use of three generic strategies helps in the process of comparative scope making and competitive advantage development. For the future strategies of this association, the strategy of differentiation is focused (Bondarenkoet al. 2017).
|
· More than 300000 customers · Brand Reputation |
· Chargeable delivery charges except for Sydney (Bull et al. 2016) · Strong competitors like eBay, Amazon, etc. |
|
· Expansion in other countries · Introducing new products rather than the current products |
· New internet based retail shop · Change in customers behaviour |
The strategic objectives for Appliances Online are:
The identified strategic objectives of Appliances Online are competitive according to the current market. There are numerous competitors in this E-Commerce business, and the number of competitors is increasing according to the Porter’s five forces analysis (Daellenbach, 2015). Therefore, expanding the business rather than Australia could be a better option for this company. New Zealand is the nearest neighbour of Australia. Therefore, the new market is identified as New Zealand. For acquiring this market, it will be using the differentiation strategy which will be associated with developing new products and new market. Introducing differentiation strategy is helpful for gaining profit which will help in increasing the profit.
For acquiring a better market in New Zealand and also maintaining the existing market Appliances Online will be introducing marketing strategies. In the New Zealand market, the use of promotional techniques will include the social media platform promotion, free publicity strategies and the use of newspaper and magazines (Doppelt, 2017). For the marketing process in both of these countries, this association will be using the television and radio as part of the advertisement.
This organisation already have adopted in selling the small and large appliances all over Australia, but the introduction of new product in the existing and new market can create the problem or strategic issues. The current market of can change due to the negative impacts of environmental forces; therefore, the introduction of new products can force in losing their existing customers (E. Dobbs, 2014).
The competitive analysis of this company has identified that strong market competitors are increasing every day. So, it needs to focus on its value and variety which can help in gaining the future success. They are already forecasted in the process of range forecasting (Gollayet al. 2016).
Appliances Online is a famous web based retailer in Australia. It is growing and became favourite appliance selling service for millions of customer all over Australia. Gaining profit can be considered as part of the organisational growth and success but therefore selecting the strategic objective for increasing the profit at 10% in the next five years is preferable and also possible. However, the association wants to develop a new market in the neighbouring country of New Zealand. The process of expansion always needs specific strategy and planning because the national market becomes international in the process of expansion. Before entering the market in New Zealand, it needs to properly analyse the external environment of New Zealand which is definitely different from Australia. In addition to that, the geographical distance between Australia and New Zealand is not too far both of these lands are not attached with each other therefore the transportation of appliances or products from the Australian suppliers can be difficult. Therefore, finding new suppliers in New Zealand need more effort and more research in the market of New Zealand.
As per the promotional and marketing strategies which are part of the strategic objectives, the company is focusing on the promotional activities in the New Market New Zealand. But the use of appropriate marketing also includes the expectation and satisfaction level of the customer. Therefore, the organisation needs to understand the New Market by doing proper research or survey on the percentage of New Zealand customers who find the process of buying Appliances from internet as beneficial.
Finally, Appliances Online is also focusing on introducing new products for the Australian market. The reputation is not only related to the services provided by them but also the best quality of appliances. The wide range of products sells by this association is already differentiated into different categories. The introductions of new products in the appliances can effects in losing their current customers by focusing on new customers for new products. Thus, before introducing new products in this internet based retail business, this company has to understand the proper need an expectation of the customers which will help in gaining profit. These recommendations for the future strategies will help in gaining better brand value and also in the process of developing the production and profitability.
Conclusion
In light of the above discussion, it can be established that the internet based services provided by Appliances online are not only limited to web based activities. This process is possible because of the wide range of products and strong strategic decision making. This report is going to provide the company with a proper strategic analysis for the future years and recommendation for improving the areas.
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