Unit a weakness for the company however

Unit 2 –Discussion Board

Obie Taylor

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Now that we have identified possible locations for the company’s global expansion, we must begin the process of creating a detail strategy which will define the business strategy required for entering into a new market. By utilizing industry standard tools for analysis of the market, the company will be in a better position to understand potential competitors and the global market in detail.  Our analysis will determine the company’s strengths and weaknesses as well as opportunities and threats the market may provide currently and in the future.

 

The acronym SWOT: Strengths, Weakness, Opportunities, Threats; is an analysis tool which evaluates the company’s internal factors i.e. Strengths and Weakness in addition to the external factors i.e. Opportunities and Threats.  Financial strength, the ten US distribution center, customer base and industry knowledge; are some of the company strengths.  If limited resources, the lack of technology, or a poor location may be viewed as a weakness for the company however each element mentioned, the company has internal control.  On the other hand, positive opportunities such as, new market growth and threats like, potential competitors, lack of raw material, and government oversight are external factors the company cannot control. Therefore, by using a SWOT analysis the company will have a clear understand of what factors it can control and what factors it cannot control. In turn, a business model can be created which aligns with the company’s capabilities and resources.

 

Now having the discussions and planning for the possibilities of global expansion, our first chose of location is China and a very strong possibility of locating in Italy would require our team to address our second mandate. Which is the need to review the… “political, environmental, sociocultural, and technological environments of the countries we choses”.

 

Issues such as political stability, government regulations, trade agreements, interest rates or inflation; a company should have a clear understand of each one and how it may positively or negatively affect a business model.  Advances in technology, cultural views which may include religious views, customer demographics and social media; a company has the ability with this type of information to determine the needs of the customer.  Deregulation or a shrinking market are perceived threats as well as a new social media outlet such as the next Facebook or Instagram; could be viewed as a positive opportunity for company growth. To acquire the aforementioned information a PEST analysis is required.  The acronym PEST: Political, Economic, Social, Technology is an analysis tool which provides information on how the political, economic, social, and technology landscape affects the company in the global market.

For example, Coca-Cola PEST analysis revealed how different customs and cultures required the creation of new flavors due to the numerous countries receiving Coca-Cola products (Frue, K.)

 

By studying either type of tool for analysis, or developing both the PEST and SWOT analysis jointly, we will now have the necessary information to forecast trends in the market and better position the company to make sound decisions for the potential of global expansion.

 

Therefore, my recommendation is to use both the PEST and SWOT analysis in that order, in the company’s strategic plan.  By using the PEST analysis as a tool first, the company has the ability to flush out any external factors which may cause positive but more importantly, negative issues if expansion to China would occur. And by identifying the strengths of the company and opportunities for improvement the SWOT analysis is our second tool need to assure the success of our strategic business planning.

 

 

Reference:

 

Frue, K. (2016, November 21). PESTLE Analysis of Coca Cola. Retrieved January 12, 2018, from http://pestleanalysis.com/pestle-analysis-of-coca-cola/