2. Then, answer ALL the following questionsin both of your oral presentation and written report:
a) Analyse the competitive forces facing Qantas, using the ‘five forces’ framework.
b) Conduct a SWOT (Strengths, Weaknesses, Opportunities and Threats) evaluation of Qantas’s competitive strategy.
c) What has been Qantas’s corporate strategy across its domestic and international divisions since 1992
Qantas limited company overview: This company is recognized as the biggest company in aviation industry. This company has the biggest route and planning to grow it further. In 1920, this company has been formed. This company is the second oldest company in aviation industry (Crigie and Bekiaris, 2010). Currently, 35000 people are employed by this company.
Industry Competitors The competition is quite higher in the aviation industry. The main rivals of this company in local market is Virgin Blue airways & Tiger Plc. The international rival is British Airways. Threat of substitute products The close substitute of aviation industry is not available. Still, in local market, trains and buses could offer threat to the company. Bargaining power of suppliers Bargaining power is bit higher due to low suppliers and the concentration power in the industry (Fu, Oum and Zhang, 2010).
Bargaining power of buyers Bargaining power of buyers is bit higher due to various comapnies in the industry. Threat of new entrance the threat from new entrants is quite lower as it would take huge investment for every company to enter into the market.
Opportunity: Various international destinations Diversity of business Amalgamation with global airlines Threat: Huge fuel prices would impact over the business of the company. Financial crisis Complex situation Increasing Labour Costs
From 1992, Qantas limited has faced various changes into its operations and the functions. The services of the Australian flagship airliners have also been changed. The changes into strategies, techniques and locations have also been done by the comapny to enhance the revenue and growth and make the more competitive brand (Datamonitor, 2009). Various changes into the pricing strategies have also been done to enhance the market share.
Diversification strategies have also been done by the company (Barney, 1992). This comapny has expanded its business on huge level in international platform from 1992. Jetstar segment has been launched by the company to enhance (Craigie and Bekiaris, 2010).
Following is the accounting policies which must be overlooked by auditors: Leasing Accounting policies: According to the analysis over Qantas limited and aviation industry, it has been found that the machineries and aircrafts of this industry is quite higher and thus auditor should analyze the worth accordingly. Depreciation Policy: The depreciation should be charged by the company according to the nature of the machineries to analyze the accounting standards and depreciation amount accoridngly.
Revenue and expenses performance: According to the Qantas’s annual report, the total revenue of the comapny is $15.9 billion and the cost of the comapny is 13.83 billion. The total turnover of the company has been less and the Earnings before interest and tax has also been affected (Brigden and Cathy. 2009). Few policies of the company has assisted the company to reduce the loan of the company.
Balance sheet performance: According to the Qantas’s annual report, the total assets of the company is worth $ 20,032 m. The total assets of the comapny has been reduced by 5.41%. The Liability and equity of the company is $ 14,192 and $5,840.
Balance sheet performance: According to the Qantas’s annual report, the total assets of the company is worth $ 16,705 m. The total assets of the comapny has been enhanced from 2013. The Liability and equity of the company is $ 13,445 and $3,360.
Differences Liabilities of the comapny has been reduced in both the years. Assets performance of the company has also been changed. Similarities Performance of the comapny has been enhanced in both the years. Revenues of the comapny have also been better. Domestic policies of the company has also been similar in both the years.
The above study explain that the performance of Qantas limited is quite attractive. Through the evaluation, it has been found that the investment opportunity is quite better in the industry and it would offer high return to the investors.
Barney, J. 1992. ‘Firm Resources and Sustained Competitive Advantage’. Journal of Management, vol. 17, no. 1, p. 99. Brigden, C. 2009. Journal of Industrial Relations. Unions and collective bargaining in 2008, 513, 365-378.
Campbell, A, Goold, M and Alexander, M. 1995. Corporate Strategy: The Quest for Parenting Advantage. Harvard Business Review, viewed 21 Dec 2017, <https://hbr.org/1995/03/corporate-strategy-the-quest-for-parenting-advantageandgt. Craigie, J. and Bekiaris, M. 2010.
Money. Qantas gets cosy with AirAsia, 2120, 16-16. Datamonitor. 2009. Airline Industry Profile: Asia-Pacific. Airline Industry Profile: Asia-Pacific, 1-32. Elmuti, D. and Kathawala, Y. 2001.
“An overview of strategic alliances”. Management Decision, vol. 39, no. 3, pp. 205-217. Fu, X., Oum, T.H. and Zhang, A. 2010. “Air Transport Liberalization and Its Impacts on Airline Competition and Air Passenger Traffic”. Transportation Journal, vol. 49, no. 4, pp. 24-41.