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Business Driven Technology 6th Edition by Paige Baltzan
Edition 6ISBN: 9780073376905Business Driven Technology 6th Edition by Paige Baltzan
Edition 6ISBN: 9780073376905 Exercise 2
Build Your Own Business
You have recently inherited your grandfather's business, which is conveniently located in your city's downtown. The business offers many different kinds of specialized products and services and was first opened in 1952 and was a local hot spot for many years. Unfortunately, business has been steadily declining over the past few years. The business runs without any computers and all ordering takes place manually. Your grandfather had a terrific memory and knew all of his customers and suppliers by name, but unfortunately, none of this information is located anywhere in the store. The operational information required to run the business, such as sales trends, vendor information, promotional information, and so on, is all located in your grandfather's memory. Inventory is tracked in a note pad, along with employee payroll, and marketing coupons. The business does not have a website, uses very little marketing except word of mouth, and essentially still operates the same as it did in 1952.
Throughout this course you will own and operate your grandfather's business, and by taking advantage of business practices discussed in this text, you will attempt to increase profits, decrease expenses, and bring the business into the 21st century. For the purpose of this case, please choose the business you wish to operate and create a name for the business. For example, the business could be a coffee shop called The Broadway Café, an extreme sports store called Cutting Edge Sports, or even a movie store called The Silver Screen. Try to pick a business you are genuinely interested in running and that aligns with your overall career goals.
Write an analysis of buyer power and supplier power for your business using Porter's Five Forces Model. Be sure to discuss how you could combat the competition with strategies such as switching costs and loyalty programs.
You have recently inherited your grandfather's business, which is conveniently located in your city's downtown. The business offers many different kinds of specialized products and services and was first opened in 1952 and was a local hot spot for many years. Unfortunately, business has been steadily declining over the past few years. The business runs without any computers and all ordering takes place manually. Your grandfather had a terrific memory and knew all of his customers and suppliers by name, but unfortunately, none of this information is located anywhere in the store. The operational information required to run the business, such as sales trends, vendor information, promotional information, and so on, is all located in your grandfather's memory. Inventory is tracked in a note pad, along with employee payroll, and marketing coupons. The business does not have a website, uses very little marketing except word of mouth, and essentially still operates the same as it did in 1952.
Throughout this course you will own and operate your grandfather's business, and by taking advantage of business practices discussed in this text, you will attempt to increase profits, decrease expenses, and bring the business into the 21st century. For the purpose of this case, please choose the business you wish to operate and create a name for the business. For example, the business could be a coffee shop called The Broadway Café, an extreme sports store called Cutting Edge Sports, or even a movie store called The Silver Screen. Try to pick a business you are genuinely interested in running and that aligns with your overall career goals.
Write an analysis of buyer power and supplier power for your business using Porter's Five Forces Model. Be sure to discuss how you could combat the competition with strategies such as switching costs and loyalty programs.
Explanation
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Verified
Porter's model states that buyer power is buyer's ability of influencing the price of goods bought by them. Some of the elements of this power are as mentioned below:
1) Number of consumers
2) Consumer's sensitivity towards price
3) Order size
4) Availability of substitute product
5) Differences between competitors prices
According to Porter's model, the supplier power is the ability of suppliers to control prices of supplies provided by them. Some of the factors of supplier power include the following:
1) Number of suppliers
2) Uniqueness of their services
3) Size of suppliers
4) Availability of substitute products
Loyalty programs and switching costs could be implemented for combating the competition.
Providing special benefits to the frequently visiting customers would help the organization to retain current customers and expand their customer base.
Switching cost also help the company to protect itself against competition.
1) Number of consumers
2) Consumer's sensitivity towards price
3) Order size
4) Availability of substitute product
5) Differences between competitors prices
According to Porter's model, the supplier power is the ability of suppliers to control prices of supplies provided by them. Some of the factors of supplier power include the following:
1) Number of suppliers
2) Uniqueness of their services
3) Size of suppliers
4) Availability of substitute products
Loyalty programs and switching costs could be implemented for combating the competition.
Providing special benefits to the frequently visiting customers would help the organization to retain current customers and expand their customer base.
Switching cost also help the company to protect itself against competition.
Business Driven Technology 6th Edition by Paige Baltzan
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