Myra opened UMUC Haircuts in 1995 but has recently become aware of an increase in competition from numerous competitors. Lately, there has been news of a Hair Cuttery opening up within five miles making Myra anxious about how it might effect her business. She hopes her salon is able to remain and increase revenue by developing some aspect of her business.
Five Forces Analysis
The Five Forces Model, developed in 1979 by Michael Porter, is a useful business resource. It allows a business to determine if it can be profitable based on the industry and other competitors, in this case the competitor being Hair Cuttery. With this model, it is possible to encounter the competitive forces by analyzing opportunities, advantages, and intelligence. Porter states, “If the forces are intense (as in airlines, hotels, etc) almost no company earns a return on investment. If the forces are benign (as in software, softdrinks, etc) many companies are profitable” (Arline, 2015).
(Minimum 2 good sentences)
IMPACT (POSITIVE, NEGATIVE, or NEUTRAL)
AFFECT STRATEGY? (YES/NO)
Refers to the pressure consumers can exert on businesses to get them to provide higher quality products, better customer service, and lower prices. In reference to UMUC Haircuts, since it is a small, local business in comparison to Hair Cuttery, the amount of product sold does not necessarily affect the suppliers directly therefore giving UMUC little buying power.
Refers to the pressure suppliers can exert on businesses by raising prices, lowering quality, or reducing availability of their products. In reference to UMUC Haircuts, the suppliers of product required continues to manage power over product co...
... middle of paper ...
...s is possessing an organized business process. Myra has already established important flaws in how a few areas of her business are sustained.
Discovering the best and simplest process for employee scheduling, supply ordering, and customer appointments most likely will have a direct impact that will affect competitive advantages within the salon industry. The key is finding the most suitable technology (or programming) to enable Myra to manage her staff and lineup customer appointments. The right inventory system will also prove beneficial to manage inventory of products by tracking and enable notifications when inventory is low or have an automatic function that allows for orders to be placed. Having an organized business process combined with suitable technology will give assurance that UMUC Haircuts is here to stay despite the competitiveness of the salon industry.
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