Why the Selected Tools Will Work Best
Every business goal is often to become among the leading provider of goods and service providers globally. They strive to establish an excellent global market reputation by ensuring that they deliver high-quality products that meet the exact customer demands ( Mullins, 2010) . Based on the selected business analytical tools, I concur that the three chosen tools significantly integrates with a global strategy that will see the company develop beyond its borders. Taking a look at the three analysis tool namely, the SWOT analysis, PESTEL and the porter five forces, it is noted that they help in meeting a company’s global strategy in various ways as follows
SWOT Analysis
Since a global strategy involves the process that a company adopt to expand to the international market, SWOT analysis comes handy in this process. It is a tool that often gets applied by businesses that are in their initial stages and ones that are about to launch a new product to the market. The analysis tool provides an in-depth assessment of the market that the business wants to expand to. It also helps the business by evaluating its competitiveness with regard to the company competitors in the new market ( Rothaermel, 2015 ). The market in which the business is seeking to expand, the financial strength of the company, the market share et al. The strength and weaknesses regarding the SWOT help in assessing the advantages as well as the disadvantages of the organisations capital resource and not limited to infrastructure, competitors among others ( Armstrong, Adam, Denize & Kotler, 2014) . The SWOT opportunity and threat help in analysing the organisations' external environment. It gives a clear picture of the level of wellness with which the business measures up regarding competitors, the rules as well as the target nation’s government regulations in which it is seeking to expand.
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Porter Five Forces
It serves as an integral tool for the global strategy of a company since it helps in diagnosing the existing competitive pressure in the markets that the business seeks to expand to. The tool helps to intensely analyse the competition from the rival business same to the one getting globalised, identifying the level of existing competition regarding the new entrants in the industry the business operates, the existing competition from the substitute products getting produced by companies in the nations the new company is seeking to venture ( David, 2011) . The tool as helps in determining the supplier bargaining power in that specific target market finally the customer bargain power.
Evidence that Supports My Decision
It is evident from organisations such as Coca-Cola which is a global beverage brand on the successful usage of the SWOT analysis tool to penetrate new markets. For example, under strengths in the SWOT analysis, the company able to use its company owns as well as controlled distributors, and independent bottlers will make it possible to access the new markets and make available their products with ease considering it had all the resources beforehand. It noted that it had a weakness regarding water management. The company produces beverages whose primary material is water. While investing in a new nation, it has to consider enough water availability for effective operation. Under opportunities, the company identified the need for diversification. Through this, it has managed to invest in other beverages as well as mineral water such as Dasani as a global strategy in the new markets. The company has noted threats from organisations such as Starbucks and Dunkin’ Brands which has placed a significant dent to coca cola market share. Having before information about the likely threats to face in a new market enables the company to develop strategies to counter the threats hence allowing successful market penetration.
How I Would Refute the Selection of an Additional Tool
The global strategy involves mechanisms adopted when investing in a new nation. It is therefore vital to consider aspects that are likely to affect the entry of new business in the specific market. The tools need to establish ways to penetrate the market effectively. The tools need to provide a roadmap that shows how? And when? The company will achieve its objectives
Understanding the market in which a company is set to operate is an essential action in every organization.
Analysis of My Market
The application of SWOT analysis tool will help to understand the UK market regarding the fashion and design industry considering that my selected business will be dealing in the cloth line industry. The Apparel as well as footwear market has consistently grown over the last six years. The volume of sales of clothes has increased dramatically based on the nation’s annual clothing expenditure. Most of the clothing purchases got made by women who were in great search of outwear garments. From this it gets noted that the UK has had an increased consumption of clothes more so the women outwear as compared to men. It therefore presents a great opportunity for my selected business which will engage in the selling of female clothes. Though the market comes with an opportunity, it equally presents the company with threats. The high tax rates imposed on the importation of raw material essential in the manufacturing of clothes. It therefore possess a challenge to new business targeting to enter the UK market. The company would likely face stiff competition from the already established clothe brands such as Primax, Next as well as Newlook. Other online Shops for example ASOS will make it difficult for the new company to have a solid online market penetration. The readily existing companies would pose a great competition threat to new entrants hence reducing the new companies’ success rate.
References
Armstrong, G., Adam, S., Denize, S., & Kotler, P. (2014). Principles of marketing . Pearson Australia.
David, F. R. (2011). Strategic management: Concepts and cases . Peaeson/Prentice Hall.
Mullins, J. W., Walker, O. C., Boyd, H. W., & Larréché, J. C. (2010). Marketing management: A strategic decision-making approach . Boston: McGraw-Hill.
Rothaermel, F. T. (2015). Strategic management . McGraw-Hill Education.
