Business creates a competitive strategy that is built on and exploits its strength and overcomes for its weaknesses. Strength is positive internal factors that contribute the accomplishment of Pridana’s mission, goal and objectives. Weaknesses are negative internal factors that inhibit the accomplishment of its mission, goal and objectives.
4.4.3 External Environment analysis
The external refers to microenvironment and macroenvironment and also on opportunities and threats of the business.
The firm in a given industry uses a particular competence. Technology, product or service to satisfy customer needs. In microenvironment can be suppliers, marketing intermediaries, customers, competitors and publics. According to Porter (1980), the stronger any of the forces mentioned below, the more limited is the ability of the company to reap greater profit or achieve a better market share.
Figure 6: Porter’s five forces
1. Bargaining power of supplier: low, the owner determines the number of products to be supplied and at what specific times and periods.
2. Bargaining power of buyer: medium, customers the type of product they needs and Miss Prida provide all the necessary food to satisfy their needs.
3. Barriers to entry: High risk other competitors may enter the market, but cots in doing so, they to accept the price placed by the business.
4. Rivalry against other firms: low, there are no distant enterprises similar as Miss Prida regarded as a major competitor for PEL. The intensity of rivalry is low. Because they do not bother about what the strategy the other competitors are implementing.
5. Threats of substitute’s products and services: High, this implies can adopt a strategy to specialize only in food services for different kinds of curry.
Grant (2005) has added one element into the PFF model namely suppliers of complementary products. PEL will be the products , specialty, parking and location.
PESTLE used to examine current and future of PRIDANA. This helps the strategic planning and gaining competitive edge over other firms. PESTLE stands for:
Political factors affecting PRIDANA in terms of government regulation and legal issues example tariffs, tax policy, business registration, permit and political stability.
Economic factors affect the business operation and decisions making of PRIDANA for example inflation rate, interest rates and economies of scale.
Social factors affects the cultural and demographics aspects of the environmental in the business for example age distribution, population growth rate and so on.
Technological factors affects PRIDANA‘s cost and quality of the output example if there is new machine, technological change research and development and so on.
Legal factors influence PRIDANA’s operation, its cost and demand of the products example health and safety law, consumer law and so on.
Environmental factors refer to the ecological and environment aspects such as weather,...