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Strategic Environmental Assessment And Land

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Question:

Discuss about the Strategic Environmental Assessment and Land.
 
 

Answer:

Introduction:

The significance of external environment is very important while making strategies during the launch of a new product. It is also necessary for making timely alteration in the existing strategies to maintain the gained potential. Nevertheless, external environmental analysis is very important for attaining a sustained business performance. External environment analysis is important while planning the strategies. It provides adequate information on various factors, which affects the business operation in the local country. Various factors are political, economic, social, technology, environmental and legal (Yüksel 2012). Nevertheless, every single aspect influences the business operation. The success of any business depends hugely on all the mentioned aspects (Ho 2014). For example, if any business has violated some ethical commitments such as failing to pay the minimum wages, the particular action would attract legal proceedings against the organization. This is harmful for both the reputation of the company and its business operation. The business operation from here after would be under strict surveillance of various restrictions imposed by the local government. Corporate social responsibility has now become a widely practiced operation for numerous reputed companies. They have concerns for CSR because they understand the wastages that their business is producing such as the emission of carbon-di-oxide (CO2) is harmful for the living creature. The rising awareness for environment friendly business practice in common people has forced various companies to become environment friendly (Rapoport 2016). The fact clearly states the effect of changing perceptions for environment on the business practice of various organizations. External environment analysis can be done with the help of various techniques such as PESTLE & STEEPLE analysis and Porter’s Five Forces Model. External environment analysis helps an organization to be specific with the customer’s requirement, which is very necessary to avoid business losses. On other hand, the internal environmental analysis can be done with the help of SWOT analysis of the company’s existing business operation. This is necessary to identify the strategy related failure if there is any (Craig and Campbell 2012). This is important for a sustained business performance as this provides a strategic control to an organization over its exiting operation.  

Analyzing the major external environmental changes

Political

·       Political environment is confusing

·       Opposition parties are very aggressive that also discourage the government from taking any initiatives

Economic

·       Hong Kong is economically stronger in financial services

·       GDP growth rate is affected in recent time

Social

·       Imported goods have comparative lesser tax duties imposed on those, which makes those suitable to the local public

·       Diverse nature of shoppers in the city favors both the budget as well as the luxury budget

Technology

·       Unlike China, Hong Kong government has not imposed any censorship on internet use, which means all the services in the Western countries would also be available in the city as well

·       Setting up business in Hong Kong is relatively easier

Environmental

·       Growing population density in the city has elevated the pollution level in Hong Kong

·       Growing population is encouraging an elevated construction of closely placed towers, which is a threat for free air

Legal

·       Minimum wage law is in favor of low income earner

·       Working hours are variable, which is more in support of higher position holder

 

Figure 1: PESTLE analysis

Source: (created by author)

The external environment in Hong Kong is a mix of different variables of which some are supporting the business operation of 759 Store. The political situation in Hong Kong is very unfavourable to growth because opposition parties oppose aggressively to the government projects (Shiu-hing 2016). The economic growth is reduced to some extent at present; however, it is expected to grow by the end of 2018. Financial services are the highest supporting resource for the economic growth (Mathews and Yang 2012). People in Hong Kong have passions for shopping and they are open to any format such as expensive products to budgeted products (Waters and Leung 2013). This is very useful for the 759 Company as it would continue to help the business of the company. Internet use is not censored, which would help the 759 Company to enhance its business connectivity with the different countries such as with its suppliers in Japan (Naughton 2012). The increasing numbers of population density and the incrementing numbers of closely connected towers are supporting the increase of pollution such as air pollution (Ng et al. 2012). The minimum wage for low income earners is given high importance but it lacks in duty hours for the lower designated labours. They are needed to work for longer than the normal duty hours (Davis 2016.). 

 

Appropriate tools analyzing the current business plans

Following tools can be used to analyze the current market position of the 759 Store:

  • Sales figure- This can effectively help to analyze the current business position of the company. The sales figure would help to differentiate the company’s position from its competitors. This would tell about the effectiveness of its products in comparison to its products (Kew and Stredwick 2017). The 759 Store has maintained a stunning growth in its sales figure as it records a powerful 10.6 percent growth in its sales figure every year (Inside Retail 2017).
  • Survey with customers- Conducting surveys with the customers are another very useful way that helps gain a good knowledge about the product’s popularity in the market (Cassidy 2016). This can be done by offering customers feedback forms provided to them after they finish their shopping. Customers can also be asked to participate in an online product review system where customers can rate the purchased product based on their experiences.

The 759 Store has challenged the business of major supermarkets with its sheer business growth. The expansion of its stores from 60 to 180 is indeed worth mentioning. It is witnessing stunning growth in its business as well where other retailers are facing losses (Bschool.cuhk.edu.hk 2017). However, the appreciating Japanese Yen has forced the company to shut its few stores for compensating the losses generated by the incremented purchasing costs.

  • Positioning some stores close to each other just to reduce the rental charges to provide cost effective products to customers
  • Imports approximately around 30 % of the snacks from Japan that helps as well to keep the product’s pricing low
  • Within a span of only 6 years, the company had achieved an exceptional feat where the company is even challenging the business of various super markets
  • Good relationship with the suppliers in Japan

Positioning some stores close to each other is one of their strategies that have helped the company effectively to cut down on its sales price. A reduced sales price is one of their strength that has helped the company see a homogenous growth within just a span of 6 years (Johnston and Bate 2013). It imports 30% of the snacks from Japan, which helps them offer cheap prices for the products that are also good in quality. It took a very short span of time for positioning it at a solid position in the market. It is capable of making profits even during such times where many other fail to maintain their previous performance. Making good relationships with the suppliers in Japan is one of their strategies that have enabled them offer cheaper prices to the customers (Slack 2015). This is necessary to keep the relationship going, which on other hand is one of the keys of 759 Store that helps them offer products at cheaper prices.

Following are some of the weaknesses of the 759 Store:

  • Inability to maintain the offerings of products at the cheapest prices because of Japanese Yen fluctuation
  • Less availability on the advertisements stunts

The fluctuation of the Japanese Yen such as appreciation makes it tough for 759 Store to maintain the offerings of products at the cheapest prices. The appreciated value of Yen increases the purchasing cost for the company. Therefore, they have also cut down on their offered prices to avoid the company from any losses (Wheelen and Hunger 2017). The contemporary business world takes a full advantage of different advertisement stunts to catch the attention of media and customers. However, the 759 Store is yet to consider the importance of advertisement stunts.

Needs of stakeholders and their expectations are mutually connected to each other by means of operational process of organization. Organizations need stakeholders for their business whereas the stakeholders have their certain stakeholders with the organizations (Mahazril‘Aini, Hafizah and Zuraini 2012). The concept would be clear after understanding the different stakeholders and their purpose of being with the organization. Following are some stakeholders that an organization in general used to have:

  1. Customers- They are the main reason behind the establishment of a business as the sales of products depend hugely on their behaviour. Consumers on other hand expect the organization to offer quality products, which has values for the money spent on it (Mueller and Naffziger 2015).
  2. Suppliers- They are the one who actually supply the required materials to the organization. Organizations need diverse range of suppliers, so that, they could make selections of their required suppliers for offering cost effective products to customers. Suppliers on other hand need a good offer to their materials. They also need regular demands of materials, which is necessary for their regular business (Jenster and Søilen 2013).
  3. Employees- They are the valuable asset of an organization. Employers need employees for the commencement of the projects. Employees need the salary offered to them for their works (Aldehayyat and Al Khattab 2012).
  4. Local government- Business do contribute in the gross GDP growth in a country. An elevating business growth would certainly help the parent country with an elevated GDP. The local government of a country does expect an elevating business performance from top contributing companies (Namada and Bagire 2013).
 

Stakeholder needs and expectations of 759 Store

The 759 Store needed a good response from its customers to prove their business a worth in the market. Customers have responded to the urgency that was once felt by the company. The customer’s responses have made this a highly progressive company that makes an approximate 10% profit every year. On other hand, 759 Stores has also provided good quality products to customers at the cheapest prices. Customers expect that the company keep on offering the quality products at the cheapest prices. The company has its suppliers in Japan as well, from where it receives 30% of their snacks. Suppliers need a healthy business option from the company, which the 759 Store is efficiently providing. However, the company needs some additional suppliers who could provide supports for some additional services such as occasional gifts, product’s sample and repackaging of the products. The company needs some experienced employees that could raise their future capabilities. This is very necessary to stay alive in front of big companies that are getting attracted towards Hong Kong. They also need some fresh talents for their future promotional stunts. Employees expect a fair deal of payment of wages. The 759 Store indeed pays wages to its employees appropriately.

The Ansoff matrix Model helps to determine existing strategic options for an organization. It is composed of four quadrants such as market penetration, product development, market development and diversification. Market penetration describes the level of penetration that the existing product line has attained so far. Product development states the development of new products, which organization does when they intend to enter new market. Market development is the making of strategies for an entrance into the new market. Diversification is the process of offering diverse products to suit the needs of different types of customers of the target market (Darvish and Temelie 2014).

The 759 Store is into the diversified stage because it is engaged in developing several other kinds of products. With the help of these new products, the company has actually entered into a new market. The company has targeted diverse customers with its diverse products such as Millennials with cosmetics.

Strategic plan for the company:

According to the Porter’s generic strategy there are three ways of approach: cost leadership, differentiation and target or focus. Focus has been further divided in two parts cost focus and differentiation focus. The strategy that should be implemented by 759 stores is differentiation in terms of the products the store has been selling groceries and snack items as a part of product differentiation it can incorporate a section in the store that sold books and stationary items (Jenster  and Søilen  2013). 

New products to be introduced- The Company as a part of the differentiation strategy can involve the stationery items section in the stores where school and office supplies will be available along with magazines and newspapers. This will help the company to connect with some of the customers on a regular basis that would further build customer relationship and create value for the organisation in the long run.

Improved promotional stunts- They need to take full use of the promotional stunts that are traditionally popular in order to install a changed brand image form just grocery items to stationery items as well. Some of the popular promotional stunts are such as PR event, online advertising etc. They can choose their choice of advertisement strategy according to their needs and its feasibility with the management capabilities (Agyapong and Muntaka 2012). The promotional strategy will be focused on the new products and the essence of the promotion will be daily encounters and being a part of the daily life of the people.  

Comparative understanding of activity

The 759 Store is different to other organizations in its strategy. The company never thought of competing with big stores such as Wellcome, ParknShop, Mannings, Watsons and 711. This is because these stores belong to mighty competitors such as Dairy Farm Holdings and A.S. Watson Group. The company indeed bought stock directly from Tokyo. The company felt it safe to be at distant to its competitors, which is contrary to the competitive rivalry in the same industry. They rather believed in delivering the best to their customers by establishing their own place in market. To serve the purpose, the CEO Mr. Lam did personally move to Japan to approach some suppliers. The deal did eventually help the company get 30% of snacks from Japan at the lower than the price offered by the suppliers in Hong Kong. Nevertheless, during the hard times where other stores of the same industry struggled to maintain a healthy grow in their revenues, the 759 Store did it convincingly. Moreover, the company enjoys an approximate growth of 10% every year in its total earned revenues (Jenster and Søilen 2013).

On the basis of the above analysis the company is found to be able to diversify in the product segment. As the strategy is opted to invest in a section of products the company should prepare for the same:

  • Needs of suppliers- They need new suppliers and contacts of the segment that is being added to the line of products, the supplies the company will choose should offer them sample of the products. This is necessary to have a trial of the products before selling those to the consumers. This would help detect any quality related failure. Moreover, this is necessary to maintain a good reputation in the market. (Lake 2012).
  • Reducing the operating expenses- They need to reduce the expenses made on operation. Operating expenses can be reduced with the help of some strategies such as outsourcing of some business operations. This would help the 759 Store avail their required products at a reduced rate. This would enhance their capability to meet with the rising demand of customers, as they would now have an additional centre of resource for their products (Nartisa, Putans and Muravska 2012).
 

Stakeholder engagement plan

The strategy that has been taken involves stakeholders such as employees, suppliers and customers.

Suppliers: In order to engage the suppliers in this differentiation of products process the company has to offer a new agreement where stationery items have to be incorporated. Contacts have to be made with new suppliers in order to have a regular supply of newspapers as well as magazines regularly. Along with local newspaper some of the national newspapers should also be made available in order to cater to the demand of the target market (Ebner 2013).

Employees: The employees of the company are accustomed to the old products that are available in the store but they have to learn about the new items that are being introduced. A team meeting should be conducted to involve the employees in the differentiation process so that they get a heads up about what changes are going to be made. The employees can also be made aware of the types of items that are going to be incorporated in the new sections so that they can easily guide the customers.

Customers:  For any organisation the customers are the most important stakeholders, the customers have to engage with the change with the help of promotional activities especially traditional methods of marketing and communication.

The future organizational strategy would be implemented in the organization with the help of following resources implementation:

Following would be the required human resources for the future strategy:

  • Recruitment of fresh employees needed for the new section of product that is to be introduced, the people will be hired by a interview and selection procedure
  • Recruitment of experienced employees to enhance the capabilities of 759 Store’s workforces, which would also be done through recruitment & selection process. This recruitment will be for higher managerial position
  • Making relationships with some new suppliers, which can be done by approaching some trusted consultancy. Moreover, they would help the 759 Store to get their desired supplier (Aldehayyat and Al Khattab 2012)

The proposed future strategy would require significant investments to be made on the recruitment, infrastructure and suppliers. For product differentiation and addition of choice more shelves space will be required, the new suppliers will be made in order to get new product in the line. The agreement with the new suppliers will require contracts and investment. The people who will be hired to cater to the new product section would require significant spending on the trainings required for the hired fresh talents as well. They would also need to pay a significant sum to the consultancies, which would supply them their required new suppliers (Namada and Bagire 2013).

Measures of implementation of the strategy

For a company to involve in differentiation of product means a lot of application of financial as well as HR resources as discussed above. The steps that are to be taken in the process of differentiation are:

  • Hiring of new people for sales purpose
  • Hiring experienced people on the management level
  • Investment in the infrastructure of the stores to accommodate the new products as new shelves space and additional area also may have to be added to the store
  • Contacting the suppliers of the new product
  • Coming in to an agreement with the new suppliers of the business there should be a number of suppliers for newspapers; magazine and stationery items.
  • Creating more contacts and reputation in order to leave scope for future expansion and growth (Slack 2015).

Tasks

June

July

August

September

October

November

December

January

February

 

Gathering of information

 

 

 

 

 

 

 

 

 

Development of strategy

 

 

 

 

 

 

 

 

 

Strategy review

 

 

 

 

 

 

 

 

 

Plan implementation

 

 

 

 

 

 

 

 

 

Figure 1: Scheduling of different tasks

Source: (created by author)

The above scheduling of different tasks indicates the planning for the execution of different tasks. According to the scheduling depicted above, the first three months would include the gathering of necessary information of the changing external environment where the 759 Store operates. This would be followed by the development of strategy, which would be adopted to solidify the business operation of the company in the near future. The documented strategy for the future business would then be reviewed by aligning the required changes with the organizational values. After finding the feasibility of the planned strategies with the organizational values and the rest other resources, the planned strategies would be implemented to get the desired results.

Organizational values needed for the planned strategy

The required organizational values are the set of principles or ways through which an organization can attain the desired vision with the planned future strategies. The required organizational values encourage a participative and an engaging contribution from every stakeholder. This is necessary to attain the desired vision from the planned strategies. The attainment of the vision would be achieved with the help of following steps:

  • Recruiting fresh talents for conducting some promotional stunts, which is one part that are not significantly considered in the 759 Store yet
  • Recruiting experienced workforces that have relevant experience in the retail industry
  • Making relationships with some new suppliers

The recruitment of fresh and experienced talents would be done with the help of interview process. The selected candidates would then undergo training process, which would attract a significant investment. The financial department of the 759 Store would then appear in the implementation process. The organizational management would then be needed to search such suppliers that fulfill their changed desire. They can even approach to some consultancy, which can certainly provide the required suppliers to the 759 Store. This is a very convenient way to get the required skill; however, it attracts a significant investment also.

 

Alignment of the values with the existing values

The required values for the implementation and execution of the planned strategies are very much in alignment with the existing organizational values. The planned implementation strategy is for the enhancement of 759 Store’s future capabilities. This is also for entering into the diversified market with diverse range of products. The enhancement of future capabilities is very much similar to the existing values that support the acquirement of competitive edge by giving cheapest pricing for the offered products. The future capabilities are similar in nature, as this would give a firm competitive edge to the company in the near future. The desire to venture in some other diverse market is again in the line of the existing values. The venturing is nowhere stating any direct competition from the separate competitors of the respective market. This indeed is just to save the company from any unwanted losses from the rising competition in the retail market. The 759 Store actually want to have some other options as well to compensate for any unwanted loss in the existing business.

Mission statement- “To implement a strategy of differentiation of products and items that are sold in the stores, the segment that has been focused on is stationery items along with daily newspaper and magazines”

Vision statement- “To provide the customers with diversified product under one roof at reasonable price” (759store.com 2017)

Based on SMART objectives following are some future objectives for the next five years for 759 Store:

Specific- To attain a notable feat in the diversified market such as stationery items and newspaper

Measureable- To increase customer footfall by 20% and sales maximization by 10%

Attainable- To engage the customers in new and improved services and more options in the product choice  

Relevant- To check for the accountability of the strategies with the different resources of the 759 Store such as the financial resources

Time bound- To achieve the set target within the next five years

Measurement & evaluation of the progress of the planned strategies

The measurement and evaluation of the progress of the planned strategies can be done with the help of data collection of every year after the implementation has been done. Measurement of the progress would be done every year to check for any improvements the plan needs. Following are some Key Performance Indicators (KPIs) for the first year, which would help to measure the progress of implemented strategies (Haines 2016):

  • Appreciation in sales figure at the end of every quarter of the year
  • Incrementing positive feedbacks of customers for diverse products in the future  such as cosmetics and toys
  • Reducing numbers of negative feedbacks with the deployment of innovative thoughts after the end of every quarter
  • Reviews generation from good to excellent till the end of year

The evaluation of the progress of the implemented strategies can be done with the data collection process, which would include the collection of sales figure data at the end of every quarter. If the sales figure has depreciation measured against the desired figure then this would be termed as a negative progress. The negative progress would then be supported with necessary strategies such as the rechecking of the quality of materials from the suppliers to make it happen in the next quarter. If the sales figure show positive trend at the end of every quarter this would be termed as a positive progress. This would further be supported with a sustained participation from every resource such as the human and the financial resources.

Measurement & evaluation of the success

Measurement of the success can be done with the help of Key Performance Indicators (KPIs) such as follows:

  • Attainment of a homogenous sales figure at the end of every fiscal year
  • Elevating graph of sales figure at every annual business report
  • High conversion rates of customers by considering the repurchase
  • Success in diversified market such as in cosmetics and toys

The evaluation of the success can be done with the help of annual sales figure. If the sales figure follows an elevating graph at the end of every fiscal year this would be termed as a success. If the graph of sales figure against the time shows a uniform graph this would be termed as a partial failure. Such situation would be assisted with some other strategies such as improving the quality of raw materials or reading the customer’s perception with the cosmetics and the toys. If the graph shows a declining trend this would be termed as a failure. Such situation would then give place to another thought process for finding the causes behind the failure.

 

References

759store.com. 2017. 759 Store. [online] Available at: https://www.759store.com/shop.php?lang=eng [Accessed 28 Jun. 2017].

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Using reliable plagiarism detection software, Turnitin.com.We only provide customized 100 percent original papers.

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265 Order Completed

97% Response Time

Ken Campbell

MSc in Electrical Engineering

Wellington, New Zealand

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96% Response Time

Arapera Billing

Masters in Management, MMgt

Wellington, New Zealand

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230 Order Completed

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Liya Han

Master Of Science in Geotechnical Engineering (MSc Geotec)

Singapore, Singapore

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154 Order Completed

97% Response Time

Harold Alderete

PhD in Economics

London, United Kingdom

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FREE Tools

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Chemical Equation Balancer

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Gave them a small amount of time and they pulled through for me. Wonderful.Gave them a small amount of time and they pulled through for me. Wonderful.

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User Id: 357602 - 14 Dec 2019

Australia

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It was very good work and I got an 85% on it. Thank you very much for your help and fast response

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User Id: 348363 - 14 Dec 2019

Australia

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Was very good work and I get a full mark on it. Thank you very much for your help

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User Id: 348363 - 14 Dec 2019

Australia

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I still cant find the plagiarism report I was told to below the assignment but it is not there, I really appreciate the help thank you.

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User Id: 315260 - 14 Dec 2019

Australia

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