Answer To: Microsoft PowerPoint - MNG00114_BSR Presentation [Compatibility Mode] 17/04/2018 1 Assignment 2...
Parul answered on May 09 2020
Amazon Australia
Contents
Executive Summary 2
1 Introduction 3
2 Internal Environment 3
SWOT Analysis 4
Strengths 6
Weakness 6
Opportunities 6
Threats 6
3.1 External Environment 7
3.1.1 Political Factors 7
3.1.2 Economic Factors 7
3.1.3 Social & Cultural Factors 8
3.1.4 Technological Factors 8
3.1.5 Ecological Factors 9
3.1.6 Legal Factor 9
3.2 Analysis of Industry 9
3.2.1 Threat of New Entrants 10
3.2.2 Threat of Substitute Products or Services 10
3.2.3 Bargaining power of Consumers 10
3.2.4 Competition & Rivalry 10
3.2.5 Bargaining Power of Suppliers 10
4 Recommendations 11
5 Conclusion 11
6 References 12
Executive Summary
Amazon was established by Jeff Bezos in 1994 and today it is one of the top retailers in the world measured in terms of revenues generated in the year 2017. The growth of the organization has been absolutely phenomenal amounting to a huge empire with capital and other resources that most certainly provides the organization a competitive edge from the rest of the organizations.
From being a leader in selling books in United States of America, the organization has transformed itself into a multibillion-dollar company whose presence is felt worldwide. Amazon competes in all aspects of retails like apparels, merchandise, music, electronics, toys & gadgets. Rate at with the organization's revenue has risen is been exceptionally high. In the year 1997 revenue for the organization was amounting to mere $150 million which when compared to year 2017 had reached to whooping number as high as $177.87 billion.
According to the research done by Resonate and Forbes "Here's Why Amazon Is Expanding In Australia"(Team T., 2017), approximately 86% of people shop online and make purchase transaction online on Amazon. There has been no denying to the fact that it has become the fastest organization to achieve $100 billion in its annual revenues
Fig 1 Net sales revenue of Amazon from 2004 to 2017 (Units are in $US bn.)
Report is structured in manner that would disclose the rationale of expansion in the Australian market and how would this decision be affected by several macro- environment factors that prevails in the context. Furthermore, how would intrinsic value of organization would help in thriving the retail industry and what could be different severe conditions that Amazon as an organization would could to encounter in this part of the world.
1 Introduction
This report provides an extensive analysis about the strategy of Amazon introducing its widespread retail operations in Australia. Heart of this strategy is concentric diversification which essentially leverages the capabilities that has been developed over time in terms of technology, cost leadership and huge customer base offering the people of Australia perceived maximum value at most competitive prices.
The organization had already established a complete fulfilment and customer service centre in Brisbane, Sydney and Melbourne to support this expansion. This report provides an extensive analysis of strategy of this business, implications it will have on the local market and what macro-economic conditions be on the operations of the organization could witness in Australia. The report provides insights that comprehends how Amazon should focus on their consumers, market opportunities and flourishing in the digital technology in Australia.
Fig 2 Amazon introduction to Australian Retail
2 Internal Environment
Amazon is not new to Australia, this organization had already introduced its web services business in Australia in the year 2012 and after that the company launched a Kindle Store on its e-commerce platform in the region. Amazon had been planning to established into brick and motor such that the company could amplify its retail offerings in Australia. They had finally established their marketplace model to Australia in 2018.
Interesting views were expressed in the paper regarding “Resource-Based View (RBV)" that highlights the intrinsic capabilities of the organization in forming strategy in order to attain a competitive advantage that is sustainable for a longer period of time, “Critical Evaluation of how well places Amazon is to Sustain its Historical In Online Retailing”, (Izogo, E. & Ozo, J., 2015)
RBV has always been prominent concept to be used in order to understand the internal abilities of the organization. Essentially, theory emphasizes that organization that owns distinctive, unique and adroit internal resources are more probable to deliver better results and out-perform their competition. Simple implication of this theory in practical is that in order to attain sustainable advantage over the competition, company should possess resources that are not only distinctive, unique but also proficient with respect to the rival companies.
On diligently examining resources that has significantly bestowed to Amazon's huge success. Although organization's team of unique employees and Jeff Bezos' radical leadership has been truly instrumental to the organization's overall prosperity. Way in which the top-management in this organization is formed and the expertise they bring on the table it appears that it is strongly placed to initiate and implement newer strategies and initiatives. They have developed unique intellectual property and employees are the centre of this intellectual development. This sets the organization apart from the rest of the crowd as team of experts Amazon has nurtured and developed are unique, exceptionally rare and highly valuable. Correspondingly, it creates SCA for the organization.
Another SCA for Amazon is their innovative and creative thinking that allows the organization to disrupt the market continuously by bringing new features to the product or a new product altogether and enhancing their service to delight the customers. Organization consistently conquer into newer territories and attain expertise in that. Blend of this innovativeness in the thinking and rare members in the team whose interest are aligned with those of the organization are completely intangible and very rare to be found.
SWOT Analysis
If we deep dive into the intricacies of the organization that can be best presented through SWOT analysis, “The Complete History and Guide to SWOT Analysis” (Morrison M., 2016). Fig 2 displays a complete snapshot of strength, weakness, opportunities and threats of Amazon
Fig 3 SWOT Analysis of Amazon
Amazon's strongest and prominent competitive advantage are the prices which the organization is able to offer. These prices are very low and along with this the company offers vast range of items, products and services that ranges from grocery, digital media, merchandises, apparels, mobile phones etc. with efficient delivery system in place. The organization has the ability to provide the product no just at a competitive price but also managed to build a well-developed delivery networks with warehouses established all across the country it operates in. However, as mentioned before in the...