Unit-3 Business Strategy Assignment Help
Unit-3 Business Strategy Assignment Help Among all the fundamental strategies, cost management is one which has to be considered by the visionaries of Mulberry while thinking about presenting a new strategy. Then, after implementing the new strategy, the increased rate associated with the factor total cost should be noted for further development.
- Market Penetration: whereby the sales are aimed to increase of the existing products. The familiarity of the product and the market makes it less risky compared to the other three strategies. Increasing the usage among existing customers or attracting competitor’s customers could do it. Also, converting non-users to users could do it.
- Product development: It refers to the development of new products for the existing markets. It is comparatively more risky to market penetration. The popularity of the organization makes it less prone to failure.
- Market Development: It focuses on selling the existing products in to new markets. As it’s a time consuming process and uncertain to acceptance it is more risky than the first strategy.
- Diversification: Highest in the risk parameter this strategy is related to introducing new products in to new markets making it an uncertain business of all. (Woodcock & Starkey, 2011)
According to the Ansoff’s matrix of strategy and Mulberry’s present positioning in the market it should take up a strategy that would be regarded as risky enough to conquer more market share. Therefore, Mulberry is recommended to adopt a strategy related to product development enhancing the quality of product and introducing new designs to keep the customers interested and coming back for more.
3.1Analyse the appropriateness of alternative strategies relating to market entry, substantive growth, limited growth or retrenchment for Mulberry
For the clear-cut understanding about the issue of organisational expansion, a future strategy has been proposed.
Market Entry: Such a strategy is referred to as a matter of business intelligence as to choose which market to enter and how is the initial point of profit. One bad decision may render the organization sinking in debts. A way of new entry may be classified based on the following types:
Direct Exporting: It may consider to exporting through a channel of least interference.
Indirect Exporting It may involve several aspects of exporting channel such as producer, middleman, exporter, processors, importer and wholesale markets.
Foreign Production: It refers to a license to produce the product in home countries regarding it as a production in foreign country of the original manufacturer.
Such strategies may involve:
? Strategic alliances
? Merger or acquisition
Substantive Growth: It is referred to a strategy to grow the business share in the market and is a forward step. It can be established through two manners:
Vertical: Whereby a company controls another subsidiary smaller in scale of affect to the entire company. It is regarded as a vertical integration and requires power over another company. Such can be done in the following three ways:
- Backward: Whereby a company owns an input company.
- Forward: whereby the company owns a post production area of a company depending on the function. Example: distribution network.
- Balanced: Whereby a balanced approach is adopted towards the owning a particular function of an input company. It is the most advantageous.
Unit-3 Business Strategy Assignment Help
Horizontal: Whereby the company acquires or buys out another company of similar nature in order to increase its market share with respect to the products and services offered. Such an act of acquiring is referred to a takeover, merger or a buyout.
Loosely translated Vertical Integration is also referred to a merger whereby two companies come together to perform a common function regulated by similar stakeholders. As well as, Horizontal Integration is referred to acquisition whereby a company outside of one’s own is bought in order to gain greater market share for the parent company so acquiring. (Mintzberg&Lampel, 2012)
Mulberry is advised to go for the mergers as the substantive growth policy in order to confirm market domination and independency of self-controlled functions.
Limited Growth: It refers to the limited growth prospects through a chosen strategy. Such a strategy may be regarded as a joint venture whereby two companies enter in to a contract to co-operate an entity. Competitive advantage gets restricted with respect to the market penetration, market development and innovation processes as it may only be developed according to the existing standards of the company. Therefore it is observed as the organization has a strong hold over the market as it is, it shall not opt for a joint venture scheme that could harbour the growth of the organization.
Retrenchment: It is a method of reducing the operations of the company to earn more profit as opposed to expenses and create financial stability. It may include withdrawal of less elemental functions. It is advisable that the remedial actions should be taken in accordance with the cost effectiveness and recession through asset reduction to minimize expenditure and revenue generation strategies to increase the inflow of profits.
3.2Justify the selection of a strategy
Mulberry shall be monitored regularly with respect to application of the strategies considering the following three factors:
Suitability: It ensures that the strategy addresses the current and future needs of the organization and meets the requirements.
Feasibility: It measures the accuracy of the goals so set in accordance with the basic requirements and the end result wanted to be achieved.
Acceptability: The acceptability refers to the realistic achievements agreed by the stakeholders in order to achieve the goals. In order to achieve maximum acceptability the most feasible strategy shall be chosen.(0Johnson, et al 2011).
A strategy may be chosen on the basis of competitive advantage. It may be referred to as an unmatched competitive approach. Strategy should be discussed based on maximum customer satisfaction and predicting the future trends of the markets. It ensures sustainability in the market, position in the market and superior skills and knowledge. A competitive advantage requires to
- Build advantage: such as attract new customers to enhance customer base
- Extend advantage: increase promotions of successful products
- Organise advantage: organizing selling mechanism
- Sustain and renew advantage: keep a check on growth of the strategy and analyse loopholes.
A strategy helps in enhancing control, implement cost effective methods, and improve focus and flexibility and coordination. It is observed that Mulberry would benefit from extending the advantage of its market leadership through acquisitions of similar scaled fashion organization. The organization would benefit from taking over businesses functioning at a low profit rate and enhance the company’s profitability by operating already structured businesses and operations. It would be considered to be the most feasible and appropriate alternative strategy at the moment. (Johnston & Bate, 2013)
Such a strategy would increase the company’s customer base and customer satisfaction would result in an increase making it a successful venture. Also, it would give Mulberry a competitive advantage over its competitors leaving them undefeated. In order to achieve the extended advantage it shall further be organized to build a strong plan of action to formulate the relevant market businesses appropriate for acquiring and developing the customer base. Such a plan may be developed keeping either customer or profits at the heart of it.
Lastly, the strategy shall be sustained by ensuring small acquisitions in a timely manner not to overpower the market and create a balance for the market to function properly.