A competitive analysis with company level profiles, functional areas and financial report begins with identification of industry competitors. This is followed with conducting an internal analysis of every company to identify existing strengths and weaknesses. It is vital to identify competitors’ growth strategies, marketing strategy, market share as well as their available resources and capital. Critically, identify why certain companies are failing while others are succeeding. Look at the efficiency and effectively of the company’s functional areas. Review core areas like marketing, HR, finance and R&D. However, this should be based on every company’s current issues. Similarly, to fully identify the weaknesses and strengths, analyze every company’s financial reports as this reveals efficiency and productivity. Carry out trend analysis and a comparison across the industry to highlight the differences. In fact, analyze each ratio and carry out a comparison to both time trends within the company and to other firms and the industry. Fully comprehend the significance of each ratio in the industry. Also, analyze non-financial numbers and mention the benchmarks, averages and productivity to help single out strengths and weaknesses.
In addition, analyze every company’s operations and management. In particular, every company’s 4Ps must be analyzed to help understand the pricing structures, promotion strategies, the product lines, the distribution channels, as well as if segmentation is employed. Also, check whether the competitor companies engage in market research as this presents them as being innovative. Equally, analyze every company’s value chain and note the difference that exists. Companies that present unused capacity basically gives an implication that the resources are underutilized which means that they are not realizing the ROA, ROI and ROE as they should. Also, look at the issues associated with the inventory and note the differences from company to company. The same should be conducted on the workforce. Is their workforce highly skilled? Does the company outsource and what is their quality?
Also, identify any unique features of the every competitor’s functional areas. This presents their efficiency and effectiveness in the industry. Review core areas like marketing, HR, finance and R&D. Analyze every company’s financial reports to identify the level of productivity and efficiency in the industry. Specifically, analyze each ratio and carry out a comparison to both time trends within the company and to other companies and the cotton industry. Fully comprehend the significance of each ratio in the industry. Equally, every company’s marketing mix should be analyzed to depict the pricing, distribution, promotion and marketing strategies each company use. Carry out inventory analysis and the value chain of every company in the industry.
i. Identifying both direct and indirect competitors in the cotton industry.
ii. Carry out internal analysis of each competitor to identify its weaknesses and strengths in the industry.
iii. Review every company’s core areas like marketing, HR, finance and R&D to ascertain efficiency and effectiveness.
iv. Analyze each company’s financial reports: Check each ratio and carry out a comparison to both time trends within the company and to other firms and the industry.
v. Analyze non-financial numbers and mention the benchmarks, averages and productivity to help single out strengths and weaknesses.
vi. Review ever company’s operations and management.
vii. Review each company’s 4Ps to help understand the pricing structures, promotion strategies, the product lines, the distribution channels, as well as if segmentation is employed.
viii. Equally, analyze every company’s value chain and note the difference that exists.
ix. Determine the competitive position of every cotton company in the cotton industry.
A. Basically, the instructor likes the focus to be on top firms over the entire industry and not top firms based on each segment. It is only by analyzing the both direct and indirect competitors that a competitive analysis is deemed effective. Otherwise, concentrating the analysis on top based firms simply means neglecting indirect industry competitors.
B. The specific aspects of an industry and its major players that should be focused on include the product lines, markets served, marketing strategies of every company, pricing structures, promotional strategies, changes in targeted market segments, revenue size, the growth rate, total sales volume, image, location areas, and the product positioning strategies. Also, focus on any instance of an innovative product and on every company’s operations and management.
C.It is a fact that globalization has direct influence on every industry (Arno 2002). Currently, many companies which were once industry rivals have either engaged in joint ventures, have merged or have formed strategic alliances. This has basically made them expand their global presence which simply reduces the level of competition in the respective industries. Equally, as a result of the global presence, the trade barriers are eliminated hence acquisition of international trade markets. The same applies to culture differences which for decades affected companies’ performance in foreign markets. Globalization permits culture transmission. Therefore, many companies in different industries find it easy to acquire the new markets and competencies.
Arno, A. Globalization of the wine industry. (2002). Web. 4th October, 2012.