Economics Laws

Use of Economics Laws in our daily life.

Global Challenges of L'Oreal

Global Challenges of L'Oreal part of our Assignment.

Case Study of (IKEA) SWOT analysis and sustainable business planning

Case Study of IKEA 

Q1) Describe what is meant by Swot analysis.

-Swot analysis is one of the most important decision making and planing tool. This tool is the first step of decision making and planning. Most of the organization use SWOT as their primary decision making  and planning tool. SWOT mainly focuses at the Strength, Weakness, Opportunities and Threats which are involved in a business venture. Strength and Weakness are the internal factor. Strengths are positive factor and Weakness are the negative factor. Internal factor includes marketing, finance, manufacturing or organization. Opportunities and Threats are external factors. Opportunities are positive factor and Threats are negative factor. External factors include the environment, economic situation, social changes or technical advances. For e.g. one of the strength of IKEA is to use no more materials than necessary in the production of each item.

Q2) Explain the difference between internal and external factors.

- Internal Factors also refers o the Strength and Weakness of the business venture. The internal factors are affected by the different aspects of finance, marketing, manufacturing or the whole organization. All the internal factors are affected due to the working process inside the venture. It can be controlled by the top level managers. In IKEA, the Internal factors i.e. Strength is it promises the same quality and range world wide. Likewise weakness of IKEA is it needs to keep good communication with its consumers and stake holders about its environmental  activities. The scale of the business makes this a difficult task.
External Factors also refers to the opportunities and threats of the business venture. The External factors are affected by the environment, the economic situation, social changes or technological advances, such as the internet. It is due to disturbance occurred outside the business venture. It cannot be controlled by the manager of the business. In IKEA, the external factor i.e. opportunities a growing demand for ow priced products. Trends in the current financial climate may result in consumers trading down from more expensive stage. Likewise, Threats of IKEA is  more competitors entering the low price household and furnishings.

Q3) Analyze ways in which IKEA has managed to minimize Threats to its business.

-IKEA tries to manage, how to minimize the threats of its business. If it manages to minimize threats, it helps, it helps IKEA to create a positive outcome.

1)Social Trends-IKEA is developing a online guide to its customers so that it will help customers to live a sustainable life. It provides ideas, tips and suggestions to its customers on their website which helps to reduce their impact on the environment. This will also help them to save money. They are hiring just the staff who are trained on sustainability.

2) Market Forces-IKEA is large enough to enjoy economies of scale. Many competitors are entering in the market with low price households and furnishings. They must try to use technologies or employing specialized managers. Economies of scale also give a business a competitive edge if cost savings are then passed on the customers in the form of lower prices.

Q4) Discuss the contribution of SWOT analysis to IKEA's business growth.

-IKEA is a well known global brand with hundreds of store across the world. To improve its performance, it took help of SWOT analysis. SWOT analysis helped IKEA to recognize its strength, weakness, opportunities and threats. With the contribution of SWOT analysis, to improve further,it must assess its external and competitive environment. This will reveal the key opportunities it can take advantage of and the threats it must deal with. Strength could include a company's specialist marketing expertise or its location. They are many aspects of business that adds value to its product or service. Likewise in opportunities that arise. In threats, if a company is aware of possible external threats, it can plan to counteract them.

Week 18 Case Study-Marketing at McDonald's

 Case Study-Marketing at McDonald's

1) What do you think about the marketing practices in McDonald's?

- McDonald's is one of the best known brands worldwide. Every organizations have their own marketing practices. Similarly, McDonald's also have its own marketing practices. McDonald's follows the 4P's marketing tools i.e. Product, Price, Promotion and Place. McDonald's firstly identifies different types of customers and their purpose to visit McDonald's. Using these information, they can create a marketing strategy. They also do SWOT analysis i.e.Strengths,Weakness,Opportunities andThreats. Once the marketing strategy is created, they go through to achieve those marketing strategies. To achieve those marketing strategies, they use the 4P's.

• Product-McDonald's mainly focuses on their products. They believe that, while offering a food menu to the customer, they could get to see many options. So that a customer could decide where they could spend their money. When a food item is launched, they will advertise through television and other advertising support. Each and every product will go through different stage of "maturity".
• Price-McDonald's thinks that, using low price as a marketing tool is that the customer may feel that a low price is indicative of compromised quality. They think that, competitors match the lower prices resulting in no extra demand. This means the profit margin has been reduced without increasing the sales.
• Promotions-One of the method they use to do marketing is above the line activity i.e. advertising through TV, radio, newspaper , etc. They also believe that, Tv advertising makes people aware of a food item and press advertising provides more detail. For them effective communication is done through medium to reach the right target market.
• Place-Place should be chosen very carefully as it encompasses the management of a range of processes involved in bringing products to the end consumer.

2)What do you believe is the reason behind McDonald's success?

-McDonald's has achieved a great success. The success they achieved is through the customer satisfaction. They build its brand by listening to its customers. It has got a unique logo. They identify customers need and requirements and meeting these needs in a better way than competitors. McDonald's gives accurate information about the requirements of the target group, making it possible to create a well thought out marketing mix. This satisfies customers which is the reason behind McDonald's success.

3)Is the marketing mix given in the case study appropriate for McDonald's? What suggestions would you give them on improving there marketing plan?

-Yes the marketing mix given in the case study is a appropriate for McDonald's.

The suggestion that I would like to give them on improving their marketing plans are:

• Launch new product every month.
• Sponsoring different programmes.
• Online Shopping.
• Free home delivery.

Week 16 Case Study1-Ryan Air Case Study2-Robert Owen

Case Study1-Ryan Air

1) What functions is Ryan Air performing?

- The function that Ryan Air is performing are:

• Europe's leading low cost airline.
• To serve a group of flyers who wanted functional and efficient services rather than Luxury.
• Offering a cargo services.
• Opened new route between Dublin and continental Europe.
• Opened Ryanair.com, a booking site.
• Its competitors is Aer Lingus.

2) What did 'management' contribute to growth of the airline?

- The 'management' contributed following to growth of the airline:

• Managers were quick to spot the potential of the Internet, and in 2000 opened Ryanair.com, a booking site.
• Also made a long-term deal with Boeing to purchases 150 new air crafts over the next eight years.
• In 1991 senior managers decided to focus the airline as a 'no-frills' operator, in which many traditional features of air travel (free food, drink, newspaper and allocated seats) were no longer available.

3) Identify three points at which managers changed what the organization does and how it works?

- 3 points at which managers changed what the organizations does and how it works are as follows:

• The Gulf War in1990 discouraged people from traveling by air, caused financial problem for the company so, the senior manager decided to focus the airlines as a no-frills' operator, in which many traditional features of air travel (free food, drink, newspaper and allocated seats) were no longer available.
• In 1997 changes in European Union regulations enabled new airlines to enter markets previously dominated by establishing national carriers such as Air France and British Airways. Ryan Air quickly took advantage of this, opening new routes between Dublin and continential Europe.
• Managers were quick to spot the potential of the Internet and in 2000 opened Ryanair.com, a booking site.

Case Study2-Robert Owen

1) What management issues was Owen dealing with a New Lanark?

- The management issues that Owen was Dealing was daily and weekly measurements of stocks, output and productivity, a system of labour costing and measure of work in progress. He used a novel control technique: a four-sided piece of wood with a different colour on each side, hung beside every workers. He also had to deal with slack managers who had tolerated widespread theft and embezzlement/misappropriation, immorality and drunkness. He introduced social innovations: a store at which employees could buy goods more cheaply than elsewhere and a school that looked after children from the age of 1 enabling their mother to work in the mills.

2) What assumptions guided his Management practices?

- The assumptions that guided his management practices did not approve of employing children in them, production control techniques, most adult employees, at that stage of Industrial Revolution, had no experience of factory work, or of living in a large community such as New Lanark, slack managers.

Week 19 Case Study-From ice cream van to Dragon's Den - Duncan Bannatyne

From ice cream van to Dragon's Den-Duncan Bannatyne

1) What are the three main forms of business?

- The three main forms of business are:

• Sole Traders-The company which is owned by a single person, where he bears all the profit and loss is known as sole traders. Duncan's first ice cream van was an example of sole traders.

• Partnership-This type of business is owned by two or more than two person where they are ready to share the profit and bear the loss is known as Partnership business. Duncan started this type of business when he was about to open first home care and huge amount of investment was taken from the Bank.

• Limited Companies-Limited Companies might be private as well as public. It issues share for getting the investment. In private company share can be easily transferable only to it's existing share holders. In public limited company shares are freely transferable to anyone. Duncan offered  shares for building more care homes.

2) Identify at least four key factors that needed to be considered when  starting a business and explain why these are important.

- Four key factors that needed to be considered when starting a business are:

• Identify a gap in the market-We must try to identify, what is the most important key factor that can help the growth in the market. We must research internal as well as external factors of the market. If we research, we get to know what is missing out there in the market. So, we can cover up those missing points.

• Do something better than or different to competitors-When we start up a new business, we must plan to do something better and different from our competitors. If we do something better or different from our competitors, there will be high chance to gain customer satisfaction. Duncan introduced new innovative idea i.e. he improved his sale by introducing a new scoop that speed up serving and made a shape like a smile in the ice cream. This was something better and different from his competitors.

• Have a Business Plan-Before starting up a new business, we must make a detailed business plan . The plan must contain what will be start-up and running cost, what kind of resources are needed, the estimated value of sales and whether the business will give right return on investment.

• Be Prepared to take risks-Every business might contain profit as well as loss. We must be ready for both situation. We know that higher the risk, higher the profit. If we can tackle with the risk, we can earn high rate of profit. Before setting up a new care home, Duncan had to sell his ice cream business as well as his house, car and colour television.

3) Describe the benefits of having a detailed business plan.

- Before starting up a new business, every business organization must have a detailed plan. Business plans have many benefits. If we have a business plan, we get to understand about the products, customers and the market strategy. What type of resources are required and from where can we get those resources. Who are the competitors out there in the market. We must estimate the values of sales of that we cannot face any kind of difficulties in upcoming futures. We must plan whether the business will give back 20-25% of investment, there is no worth of risking.

4) Evaluate the advantages and disadvantages of using external sources of finance.

-The advantages of using external sources of finance are:

Government grants loan often at cheaper rates in compare to that of banks. So, the business organizations do not have to pay high rate of interest . Banks grant large amount so, they can invest more and expand their business. If bank overdraft occurs, security is not required. If Funds are invested by the investors or share holders, it enables large scale investments. The venture capitals or business angels may give tax benefits to investors.

The disadvantages of using external sources of finance are:

If we use credit cards there will be high rate of interest rates. If we take investments from the share holders, their might be risk like rise and fall in the share values which affects the companies value. When the government grants the loan, its use may be restricted. If loan taken from bank, it may be loss to the company. If the bank overdraft occurs there often might be high rate of interest.

Early Bird - PESTE Analysis of Banking Industry

The banking industry is an enormous sector of business and finance that has existed in human civilization in some form for thousands of years. In the modern world, the banking industry plays a large part in financial dealings, as it is a major and popular means for investing, borrowing, and storing money. Banks exist all over the world, and are usually heavily regulated by world governments in order to prevent corruption and protect the money of the general public.

The banking industry provides clients with a variety of services and options. The most basic function of a bank is to provide customers with a safe, guaranteed record of their accumulated money, usually done through a checking account that can be easily accessed for withdrawals and deposits. Banks also provide savings accounts, which are also easily accessed but provide a slightly higher interest rate for funds. For many people, involvement with the banking industry is limited to these two basic accounts, but this is only a bare minimum of what the industry offers.

Banks play a major part in the investing and loaning of money. Most banks can use the funds deposited in accounts to loan out money or make investments; this practice allows a constant flow of lending and borrowing that keeps money circulating throughout the economy. Loans that many banks offer include commercial loans, property loans, vehicle loans, and lines of credit. Investment services offered by many banks include retirement, certificate of deposit (CD), and money market accounts.

PEST Analysis of Banking Industry

Political Factors 

- Regulatory Framework

- Deregulation of the Market

-Monetary Policy

Economic Factors

- The Economic Role of Banks

- Changes in Interest Rates

-Consolidation of the Industry

 Social Factors

- Employment

- Working Conditions

- Payment System Changes

Technological Factors

-      - New and Advanced Technology

-      - Increase in Productivity by Reducing Cost

Environmental Factors

-      Pollution affect the health of the people