Strategic Management Of Sanford Limited: Research And Evaluation

Introduction to Sanford Limited

Research and evaluate a range of key issue in strategic Management.

In the modern business environment, it has become essential for the companies to make sure that they have a strategic edge over their competitors. This is not only necessary for the growth of the organisation but is also necessary for their survivals (David, 2011). Strategic planning and implementation depends on several internal and external factors. It is essential for the company to understand its position in the market as well as the amount of resources it has. After evaluating this only they should make strategies for their operations. Strategic affairs not only provide a company with a higher growth rate but also assist firms in utilising their resources in a more planned manner (Hitt, Ireland & Hoskisson, 2012). Irrespective of the industry in which a firm is operational, it is necessary for them to make plans accordingly.

Terms of Reference

The report is for Sanford Limited which is one of the largest companies in New Zealand and is operational in the industry of fishing and trading of sea foods. This report is about strategic affairs of the Sanford Limited in the current global scenario. This report highlights the internal strengths of the company. It also illustrates about the strategic, corporate and functional level strategies of the company.

The information has been gathered by doing research based on the questions that has been asked. The information was collected from the secondary sources such as books, journals, online journals, blogs and many other internet articles.

3.1 Strategic analysis

Overview of the organisation

Sanford Limited is one of the best performing company in New Zealand. This company deals in the business of selling and trading sea foods as well as is the major player in the fishing Industry (Sanford Limited, 2014). Its operations include catching, processing, storage and marketing of aqua culture products and other sea food items. This company was established in the years 1904 and is headquartered in Tauranga On the northern coast of the north island of New Zealand. This firm is listed in the New Zealand Exchange and is among the 50^th largest company inside the nation. In legal ways or say in terms of liability it is a limited company that corresponds to limited partnership without having a general partner. Its main fishing areas of this firm are the water territory of the New Zealand.

Vision and Mission of Sanford Limited

Vision of the Organisation

Its Vision statements states that this company aims to become the Best Sea food company in the world.

Mission of the company

Its mission states that it aims to make Sanford, the company of their choice for the people in New Zealand and other parts of the world. They aim to achieve it by providing quality sea food and marine products, with the use of innovative methods (Sanford Industries, 2018). It aims to deliver value of the customers, stake holders, shareholders as well as employers. It aims to get social license for operating.

Objectives of the organisation

The objectives of the organisation are as follows:

• To create fishing enterprise of international scale which is having large number of products to meet the demands of the organised and more sophisticated international consumer base.
• To accumulate scarce and sustainably manage wild and farmed seafood resources so as to attain critical mass and international competitiveness from all phases of value chain i.e. from production to consumers.
• To create a serious and long term capacity to invest in research and development projects as well as making innovations on the global levels i.e. beyond the scope of New-Zealand firm individually.
• To develop growth from joining with like-minded parties in order to move from the present fragmented approach of the industry to the international markets, to firms that are bigger and integrated in offering and moving distinctive and diverse marine products from resources to consumers again in creating a stronger value chain for the future.
• To continue to respect the interests and equality of shareholders as wealth creation is achieved or pursued.

Strategic analysis

It is essential for every company to analyse its strategic positioning in the market (Hill, Jones & Schilling, 2014). It is further necessary that firm puts their efforts in making strategies that gives them competitive edge over the other players in the same industry (Eden & Ackermann, 2013). This cannot be done without doing the market analysis as well as well as industry research. There are two major aspects of analysing the strategic positioning of the company. First is to understand the internal strength of the firm and second is to make the research on the industry that is according to the global status of the market. It is essential that a company does environmental analysis. This helps them in giving idea about the ways in which its approach must be started. In order to understand the position of the company in the market there must be through evaluation of what are the capabilities of the company which they can utilise for their future business (Wheelen, Hunger, Hoffman & Bamford, 2017). This helps them in giving competitive edge over the others. A better understanding of the strengths always helps firm in making plans in a better way.

There are several tools that are available for the company to understand the strategic positioning of the company in the market (Slack, 2015). SWOT analysis is one such tool that is highly capable of evaluating the internal environment of the company. It provides details about the internal capabilities of the company which they can utilise for their future plans (Barney & Hesterly, 2015).

SWOT analysis for Sanford is as follows:

Strengths

• It stands on the 50^th position inside the New Zealand in terms of its business and resources it has.
• This company has the rights to capture fish in the whole New Zealand Water territory. This makes it one of the prime players in this industry. It is having its products sale in entire nation and hence serving a very wide range (Sanford, 2018).
• This is having one of the largest chains of distributers that help them in their operations related to distribution and sales. This helps company in reaching to maximum possible consumers in the market.
• Products of the company are of higher quality and offer a great range of taste to the consumer. It offers both fresh and iced food products. This helps them in luring the taste buds of millions of consumers.
• There is very large range of products that this company offers in its portfolio. These products are available at all the price range. This helps in having such a large base consumers.
• This company has its almost 96 % of all the territory inside the water. This makes it a home to some of the world’s most prized seafood.
• It manages almost everything in its operational chart i.e. from capturing to delivering it in the plates of the consumers hence a high value is added to its products.
• Bigger brand image inside New Zealand which works in the interest of its shareholders.
• Good financial position in the market which helps them in tackling all the economic challenges coming to them. It also helps company in their strategy making.
• It is having an experience of serving in this industry for more a century. It gives them a deep knowledge of working inside the developed economy such as New Zealand. It will give them an idea about the ways in which it should conduct their business in the market.
• Monetary assistance is also provided by the government of England in their financial distress. This will help company in stabilising its performance in the bad economic mood of the market.

Weaknesses

• Its future cost structure is estimated to be poor especially in smaller units like by products, services, customer, product line, geographic region or division.
• This company has lack of experience of operating in the international market (Sanford, 2018). It reduces its chances of expanding in other potential markets where it can gain higher profits.
• Poor performance in the last few years has added in company’s portfolio in a negative sense.
• People are having lower brand knowledge about this company outside New Zealand. Hence a lot of efforts will have to be done by the company’s management in order to establish in the new markets.
• Even after a century of experience this company was unable to make its reach in the other markets of south Asia or other parts of the world. This is an example of the strategic failure over the years and total concentration towards the business inside New Zealand.

 Opportunities

• This company is having higher scope of expansion in the developing markets. Countries in the South Asian region are having highly dense population which can be an excellent market for the country.
• The demand for the fresh sea food is increasing day by day all around the world (Sanford, 2018). It provides an excellent opportunity for the company or their future.
• There are many venture capitals which provide excellent opportunity for the growth of the company. These venture capitals can help company in their expansion plans.

Threats

• New Zealand is a developed economy and hence it is easier for Sanford to do their business in this country. In the external market there is lots of instability which can lead to business failure.
• There are large price changes in other parts of the world. Since the value of the New Zealand currency is on the lower side and hence profits from trade in other parts of the world can diminish (Sanford, 2018).
• There are lots of companies that have come into this business. This has made competition highly threatening for the survival of the firms. In such a red ocean market ensuring higher profits can be a difficult task.
• Any expansion plan needs investments for which loan can be required but the increasing rate of interest and enhanced taxes all around the world has created serious problems for the cited firm.
• There has been increase in the price of raw materials and in future it is expected to increase at much faster rate. This has reduced the margins of profit for the company ads they cannot increase the price of their products due to excessive price war in the industry.
• Economic barriers can be seen in the many regions of the world due to the dispute over use of water territories for business purpose. Apart from this government regulation of environment protection has also demoralised the industry.

Strategy Formulation

After analysing market it is essential that a company develops its strategy as per the requirement of the cited firm. These strategies must be different from their competitors so that they achieve edge over others (Rothaermel, 2015).

Objectives of the Organization

Corporate level strategies

This strategy is considered with the decision making that is capable of affecting the entire organisation (Peteraf, Gamble & Thompson, 2014). It can be understood as the careful analysis of the selection of the business in which it can successfully compete in (Lasserre, 2017). Four corporate level strategies for the cited firm is as follows:

• Growth strategy: This Company can adopt a strategy that is focused towards the growth of the organisation and can be measured by the metrics like revenue, profit, sales, assets etc. They can expand their business in the developing markets where the cost of investment is less while there is large population to serve for.
• Concentration strategy: This strategy can be utilised by the company for producing products range that is having real growth potential (Stringer, Simmons & Rees, 2011). Company can concentrate on additional resources on the product line to enhance its participation in the value chain of the product.
• Diversification strategy: This strategy is highly beneficial for the cited company as offering large range of products can be helpful in luring the taste buds of the maximum number of clients.
• Stability strategy: This strategy can be utilised by the cited firms so as to stabilise its business in terms. This can be done by adopting strategy such as no change or proceed with caution strategy.

Four Business level strategies

These strategies are used for having competitive edge over their rivals (Killen, Jugdev, Drouin & Petit, 2012). Four business level strategies for this company are as follows:

• Focused diversification: This Company can target a small group of consumers and provide them with range of products. This strategy is highly beneficial when a particular segment of the market want any specific products.
• Focused low cost: This Company can adopt a strategy where they can lower down the cost of products as per the demand of any particular segment of the market. This helps company in competing with its rivals on the basis of price.
• Differentiation: This strategy can be utilised by the company in order to serve for larger section of population. More products available in the company’s portfolio, more is the chances to attract larger consumer base.
• Cost leadership: This strategy can be used by the company in order to attract more consumers towards its products. Cost leadership provides unprecedented edge over the other competitors. For adopting this strategy first of all company has to enhance its operational efficiency.

Four functional Level strategies

This strategy is at the lower level of hierarchy but it highly associated with the performance of the firm (Frynas & Mellahi, 2015). Four functional level strategies for Sanford limited are as follows:

• Marketing: This strategy is highly essential for the company as it helps in building the image of the firm as well as promoting their products in front of their potential consumers (Luo, Sun & Wang, 2011). In modern businesses, better the marketing strategy better the chances that they can achieve success.

• Channel of Distribution strategy: This strategy is beneficial for the company as better distribution channels can help in managing their demand and supply chain (Engert, Rauter & Baumgartner, 2016). It will be better that cited firm prefers to distribute their products through market intermediaries.
• Pricing strategy: This strategy can be highly beneficial for the cited company. This helps company in ensuring profits while achieving leadership in terms of price in the industry.
• Financial strategy: This strategy can be used by the company so as to make sure that they are achieving profits even after investing in new areas. A better financial strategy always helps firms in gaining higher revenues from their business. This includes acquiring of capitals, making decisions of their use and making capital structure.

Strategy implementation and resources

Strategy development and choice

The selected strategy for the cited company is Ansoff growth matrix. This strategy gives strategic edge in the new or existing markets (Johnston & Girth, 2012). As this company aims to grow in the developing nation this strategy can be helpful. There are five strategies that is subdivided into this strategy

• Diversification: It is always beneficial when company aims to enter into some new country as it helps to attract larger number of consumers towards the products of the company (Schermerhorn, Davidson, Poole, Woods, Simon & McBarron, 2014). In the case of Sanford Limited vertical and concentric diversification can be highly beneficial.
• Product development: This strategy is also helpful in making edge in the new market (Stewart & Callagher, 2011). This is due to the reason that with the use of this strategy Sanford limited can enhance their existing product range which helps in targeting different taste lovers.
• Market development: This strategy is used by the company for entering into some other market where they were not previously present (Simmons & Stringer, 2014). This is done with the use of existing product range it has. This can be done in some foreign market, some other regions of the same nation where it was previously present. Sanford will require new investors to carry on with this strategy.
• Market penetration: This strategy can also be adopted by the cited firm so as to increase its reach in the New Zealand market only. Market share of the firm can be increased within the existing market segment (Hussain, Khattak, Rizwan & Latif, 2013). This can be achieved by selling more sea foods to the existing market base or by finding the new set of consumers in the existing market. This will be slightly a difficult strategy to implement as the population of New Zealand is not so much.

Approach to implementation of strategy

In order to implement new strategy there are various approaches that can be utilised by Sanford limited.  Change approach can be beneficial in this case. In this approach company is modified in a way that both this strategy can be implemented in a better way. It makes the process of decision making easier but also takes a whole lot of time. In order to implement Ansoff matrix strategy it is essential that company enhances its efficiency by taking use of modern technologies or reduction in the number of failures. Smoothening of the work process can help cited firm in reducing its cost of operations. For this there will many changes that will be required. On the other hand for inculcating diversification strategy cited firm has to make changes in research area so as to understand the demands of the target consumers.

Apart from this collaborative approach can also be taken into use where senior and middle level managers works with each other for successfully implementing the Ansoff matrix strategies. It helps in making sure that there is no loop holes present while implementing this strategy.

 Resources for implementing strategy

Three resources that are required for implementation of the strategy are:

• Financial backup: A good pocket always helps a firm to remove barriers related to the monetary requirements while implementing strategies like product development and diversification (Simister, 2011). The monetary funds that will be required in the market development can also be done with the help of this resource.
• Skilled labourers: In any organisation it is essential that a company has a skilled labour force (Rudnicki & Vagner, 2014). This helps in making the process of implementation easier as well as adds value to the whole process. Training is required when any new strategy is implemented within the firm.
• Technology: If a company uses higher quality technology then it always helps them in implementation of the strategy like product development and diversification. This is the must requirement in modern day business.

Conclusion

From the above based report it can be said that concluded that Sanford limited is performing well in New Zealand in the industry of trading and marketing of Sea food items. It is necessary for the company to make sure that have planned a good strategy for tackling all the issues that are faced by the company in present time as well as those that will come in future. Ansoff matrix can be a better strategy for the company for ensuring its growth in the market. Resources like financial backup, technology and skilled labours makes the process of strategy implementation easier.

Strategic Positioning of the Company

For the Sanford Limited it is necessary to train their employees in a manner that they become competent to face the global economic challenges that could help them in their expansion process. On the other hand they need to implement new set of advanced technologies that could benefit them in making the whole process smoother. They also need to find the like-minded partners so as to expand into new markets as they can utilise each other’s competencies to become successful. There top leadership will also need to make new strategies that help them in attracting new customers like the use of cost leadership strategy

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