Macville Business Venture Marketing Strategies
PEST Analysis: PEST Analysis is an abbreviation that stands for political, economic, and social-cultural and technology. The four factors affects the external environment of any business. For the companies to overcome this environment have to strategize effectively or else they will be kicked out of the business. This mainly because businesses do not have control of the PEST factors. For the MacVille’s Company, there major PEST aspects attributable to its external environment are as discussed below:
Political: The political factor is exhibited by the government regulations laws and regulations that either effect the business positively or negatively (Gupta, 2013). Businesses should take advantage of the positive political impacts and plan how to prevent or eradicate negative political factors (Rastogi & Trivedi , 2016). Similarly, MacVille should optimize the removal of the tariffs on the espresso coffee machines. There a few critical factors facing MacVille. For example, the company must make sure it conforms to the government business laws and regulations in the new areas where it wants to expand its operations. This will help the company to avoid conflicts with the government. Secondly, there is a possibility of introducing a carbon tax that may see MacVille profits being diluted.
Economic: Economic factor is one of the major PEST factor that businesses have to put in place (Koumparoulis, 2013). It will not matter whether the company is at kick-off stage or how long it has been in the factor. If the company faced by the economic constraint that falls beyond its ability there is a high probability of the business to suffer loss and eventually end up closing (Issa, 2010). On the other side, if the business is experiencing favorable economic environment there is a likelihood it enjoy higher profits, experience growth and development and expand to other regions (Yüksel, 2012). MacVille appears to face both favorable unfavorable economic business environment. Favorably, there are huge expectations that the economy will grow as result of the resources boom. Secondly, there are monetary and fiscal plans to strengthen the Australian dollar against that its trading partners. Recently, there has been a trend of the rising Australian dollar. This has had a negative impact on the tourism industry, a sector that the MacVille relies on in order to thrive in the market. Finally, the anticipated interest rates are likely to affect the disposable income available for the company customer.
Social-cultural: The social culture of the target customers largely determines the nature and the type of the customer that the company will sell in the market. If the product appears to interfere, mock or against the culture or religion of the target then it becomes useless introducing it the market (Koumparoulis, 2013). It will be easy for the MacVille to introduce its product in the new market because Australians and majority of the international tourists in Sydney likes having an evening coffee. Therefore, the coffee culture in Sydney seems to paper MacVille business operations in the region. Secondly, there is growing culture where people tend to eat out more frequently as the age. Third, there is a predicted steady growth of the Australian population up to 36 million people by 2050. The social set up in the Australia business environment offers MacVille with a lucrative opportunity to enter in the coffee industry.
Technology: In the modern business world, companies are thriving in technology. If the company is unable to adopt the latest technology it might itself kicked out of the business (Rastogi & Trivedi , 2016). Technology is a changing factor and therefore what was termed as the best technology in the industry two years ago it may be an obsolete technology today. MacVille has taken advantage of the latest technology in two ways. First, the company has taken advantage of home espresso machine that will help it ease it business operations. Secondly, the company will integrate Management Information System (MIS) to help its management and staff it executing all company business operations effectively. For example, the planned Management Information System will assist the company to carry out corporate and strategic planning that is aligned with strong internal controls in the department of accounting and finance.SWOT Analysis
SWOT analysis which is an abbreviation for business strengths, weaknesses, opportunities and threats involves the evaluation of the company or industry’s internal and external environment. Strengths and weakness are attributable to the external environment of the business while opportunities and threats falls in the external environment of the business. The MacVille internal and external environment based on the SWOT analysis will appear as follows;
Strengths: Ideally, the strength aspect comprises of the competitive advantages that the company can use to establish and maintain its operations in the market. The company will maximize its strengths to grow and develop and expand its business operations (Osita, Onyebuchi, & Justina , 2014). MacVille is endowed with a number of strengths. First, the company enjoys strong strategies of marketing its sales. The application of the social marketing has largely helped in the development of the company marketing communication and promotion mix. Additionally, the company has taken advantage of the modern technology to therefore it can reduce marketing costs by largely relying on the internet. Secondly, the company enjoys strong reputation in field of service marketing. In the past, the company has been appropriately dealing with the customers’ complaint effectively. Besides, the after sale services have earned the company the strong image in the eyes of the general public.
Weaknesses: This aspect involves the problems that can hamper the progress of the company (Valentin, 2015). The MacVille business operations face significant problems. First. The inbound logistics are underperforming due to lack of the experienced and qualified personnel. As a result the delivery times have sometimes been violated and the human resource management of the company appears to lack the solution. Secondly, the outbound logistics of the company calls for improvement. Currently, MacVille depends on the delivery firm to transport goods to their customers. It is noted that most of the times there are delays in the delivery of products and hence compromising the customers’ expected quality.
Opportunities: These are the areas which the company pursue to grow and develop its business operations (Valentin, 2015). MacVille has an opportunity to expand its business to the new Sydney market. This region has huge market of espresso machines and again the major competitor of MacVille has withdrawn. Secondly, MacVille can enter into strategic alliances with the bean suppliers to ease market penetration and reduce the costs of advertising. Finally, MacVille can obtain its objectives by entering into strategic alliances with the tenders providing and building home espresso machines.
Threats: These are the risks that are likely to hinder the company business operations in the event of their occurrence (Valentin, 2015). The greatest threat is offered by Nufix Inc. The Nufix Inc. is shifting from instant coffees to the espresso bean and machine market. The Nufix Inc. action is expected to offer fierce competition to MacVille. Secondly, BeanEx is also a threat to MacVille. BeanEx is major coffee supplier but recently it has started importing espresso machines for their customers. Besides, BeanEx has penetrated the marketing through its coffee bean trade. The entry in the market by BeanEx is expected to offer greatest challenge to MacVille espresso machine business. There is also threat that can be availed by the rising Australian dollar that can have negative impact on tourism. Review of Existing and Potential Competitors and Allies
Nufix Inc.: This is a MacVille potential competitors. It has had an experience in the coffee bean market (strength) but not an espresso machines market (weakness)
BeanEx: It is a MacVille potential competitor. The company has had penetration of the coffee bean market before (strength) but lacks experience on the espresso machines market (weakness).
Home Espresso Machines: Concentrates its espresso machine market in Sydney only (strength). It is working with the strategic partner who is not largely focused on hospitality industry (weakness).
Ambrosia Coffee Roast: Largely committed to the coffee bean industry (strength). The company is unable to protect its intellectual property and it does not put more emphasis on product quality (weakness).
Java Estate: Solely committed to hospitality and coffee bean market (strength). There is a likelihood for other coffee suppliers to advice MacVille against entering into strategic alliance with this strong strategic alliance (weakness).
Potential Allies Summary Statement
Home Espresso Machines
- Sells consumer espresso machines in Sydney only. In addition it incorporates other digital home entertainment products.
- Carries out four trade shows per year. The company can sell ten machines per show and arrive at breakeven after selling only two shows.
- Each show will contribute to the profit $10,000 per year.
- The partner is not meeting its financial commitment.
Ambrosia Coffee Roast
- Sell all the coffee bean grades to supermarkets in Australia as well as hospitality outlets around the country.
- Shares the cost of outdoor advertising.
- Can serve fifty cafes per year and reach break-even after 20 cafes.
- Profit for the year is $15,000.
- To sell quality Arabica roasted coffee beans to all states of Australia.
- Provides espresso machines to their customers for free.
- It pays for the MacVille’s delivery and installation of the machines cost price. The remainder of the purchase price is paid on 12-month repayment program.
- 200 machines can be installed in the first year and reach break-even point after 80 machines.
- Profit per year is $100,000.