Analysis of Strategies for Expansion into UK

Analysis of Strategies for Expansion into UK Introduction Research Content:- Over the last few decades, there has been a tremendous growth in the volume of business. A number of new players have entered the business world and as a result there is fierce competition making survival very difficult. Therefore it is imperative that Companies establish a sustainable competitive advantage over other competitors. One key strategy that companies have often adopted to sustain in the long term is continuous growth to become recognised brand and dominant that they can set the agenda. Thus we see huge multi-national corporate in various sectors particularly in retail, food and beverages that are dominant and sometimes act as monopolies. However, pursuing a strategy of growth simply does not mean that corporate can expand their businesses, survive and remain successful. In the past, many organisations have adopted various strategies and implemented all of them but have failed. This is because like any other strategy, growth strategies must be carefully formulated and prop erly implemented. If not, there could be severe consequences. There are many organisations particularly in the UK that are aspiring to expand their presence. However, a number of huge western based multi-nationals exist that are dominant and follow entry deterrence strategies such as patents, limit pricing, cost advantages, aggressive advertising and marketing etc, in order to prevent other organisations from taking their market share or eroding their margins. We shall study in this dissertation, the growth strategies that such emerging organisations adopt and implement to capture the markets and also see how they encounter the indirect entry barriers imposed by the giant multi-nationals. Aims Objectives The Goal of this dissertation is: to analyse the various strategies that can be composed by an organisation and the ways that they should be implemented; to list the various possible outcomes that can be achieved by an organisation with proper planning and implementation of a strategy; to study the reasons why it is important for organisations to plan and have alternative strategies Even though many companies form strategies and implement them, not all of them may succeed. So, why do companies fail to achieve their objectives with the implemented strategies. The main purpose of this research would be based on Andronicas World Of Coffee (AWOC), the way they work on the strategies they plan and the implementation process to make it a success. A Study would be done on the problem that they have faced and are facing in the present and the past while implementing their Retail business strategies to become a recognized brand. The objective is to complete the study with all the required literature review and theory which relates to strategies formulation and implementation. Analyses the reasons, motives, process and other aspects related to strategies formulation and implementation. The main objective is to have a brief study on how Andronicas- world of coffee has planned its strategy and has implemented it, in order to enter highly competitive market of coffee chains and become a leading Retailer in UK. Analysis will also be done on the performance of this organisation and the growth achieved in short span of time. The objectives that we aim to explore are given below : To Examine the strategies formulated by Andronicas- World of Coffee for establishing their retail business within UK. To analyse the different steps and ideas they used and implemented for establishing their retail business in LONDON. To find out what Andronicas- World of Coffee was and what it is now after the implementation of its formulated strategy. To study the impact of ongoing Financial crisis on Andronicas as a business. Purpose of Study:- The fast growing competition in business market has raised the need for new markets. This has inspired many small organisations to grow and provided opportunities, for which various strategy needs to be formulated. The purpose of research is on what field a company needs to concentrate and what strategy it should apply in order to enter the highly competitive market. The implementation plans of company play a vital role. Even though strategies are planned well but some companies fail during the implementation process, this is because of improper communication/ short term plans. The implementation process needs to be monitored very carefully. The purpose of the study is to identify the strategies that organisations plan and the way they try to implement it. The main aim of this study is to describe a method that can be adopted by Small medium enterprise to enter a highly competitive market that is already dominated by big market players with the Example of Andronicas -World of Coffee. Managers and leaders of companies are constantly involved into decision-making. They use different types of strategy to ensure that their business not only survives but brings profit. . Strategic ideas are relevant for all types of organization, and many of the key issues are the same although they may differ in their relative significance. All businesses in the competitive environment are affected by strategy and strategic issues if not their own, then those of the competition or the external environment[2]. Long-term strategic success requires coordination of the managers efforts and effective structure of the managerial department of the company. Introduction to the Industry Coffee makes us severe, and grave, and philosophical Jonathan Swift, 1722 Possibly the cradle of mankind, the ancient land of Abyssinia, now know as Ethiopia, is the place where coffee was born. In todays world beverages sector comprising of coffee as a sub sector is one of the key segments of the economy having extensive and forward and backward linkages with other key segments of the economy. According to the latest coffee statistics from the International Coffee Organization (ICO), we pour about 1.4 billion cups of coffee a day worldwide. In fact when we look at per capita coffee consumption, the U.K. is #22 on the list with about 5 kilograms of coffee per person per year[3]. The coffee industry has grown rapidly since the 1990s; before Starbucks emerged, people were used to drinking low quality coffee from tins. Starbucks introduced fresh coffee made from top quality beans that have excellent taste and drinks such as the caffe latte and cappuccino, which have helped to fuel the development of the coffee market into a multi million pound industry. The size of UK branded coffee chains have quadrupled from 1999 to 2004, with a current market turnover of over  £1 billion. However, Britains coffee may finally be taking a new direction. Take a walk through London and youll see a rash of trendy independent coffee houses, with blackboards boasting of freshly roasted, Fair Trade beans and organic milk. Retail sales at specialist coffee shops reached  £1 billion for the first time in 2007 and were almost  £1.2 billion in 2008. High street chains such as Costa Coffee, Starbucks and Caffe Nero are also performing well, with 890 new branches of branded coffee shops expected to open before 2012, but they are upping their game to meet our rising expectations. Jeffrey Young, of the consumer analysts Allegra Strategies, says: â€Å"Were seeing a movement to a stronger coffee palate. People say that their Starbucks is not strong enough, that Nero is stronger than their Costa. Thats something that no one was talking about ten years ago. There has been a massive revolution in coffee drinking, from drinking instant or filtered in a polystyrene cup a decade ago to espresso-based drinks made from 100 per cent Arabica beans today.† UK being an upcoming market for coffee shops, with an estimation of more than 11000 outlets opened so far and number still increasing. The total turnover of the whole coffee industry is estimated to be over  £1.63 billion for year 2009.[4] Estimations for year 2010 are expected more than 13000 coffee shops, including small, medium and independent businesses Introduction to Andronicas World of Coffee (Source: Andrew Knight) Form of Ownership: -Andronicas Coffee is a private limited company whose entire share capital is under the control and ownership of Andrew Knight. Andronicas Coffee a coffee roaster/ supplier vertically integrated, accessing green coffee at source, roasting and processing through to the point of sale, via either catering or retail industries and including the equipment required to produce the finished drink. With a 25year history of selling, serving and operating retail outlets, adopting the best of both the Seattle and European model. Focused now on trade sales identifying customers whose ideals of quality, taste and service, expectation are at the top end of the market and who see outlet expansion as the driver for their business. Promotion of our brand identity is important but secondary to the overall success and profitable growth of our business. To develop staff skills and competence to recruit to fill any gaps and to take the opportunity forward, always keeping in mind the potential property opportunity as it arises and being in a position to take it up. Maintaining our commitment to re-invest each year across marketing , new plant, product development and if appropriate acquisition i.e. office coffee service. Not to lose sight of what we have in the pursuit of what we want. Strive to do what we do better always. The company commenced business as a retailer of real coffee in the Kensington department store, Barkers in 1979. The addition of a tasting facility lead to our first conflict the restaurant manager unhappy that we should be offering a free tasting to his potential customers as they walked through the door resulted in some initial difficulty. The compromise reached with the store manager was that we could charge for our sample. This led us to operating one of the first espresso bars in London. It was popular with both the store and customers in equal measure, was extremely profitable, our rent being based on a percentage of sales and led directly to the opportunity to replicate the model at a second House of Fraser store in Londons Victoria, just 18 months after the Kensington store opened. At this time we had installed a small coffee roasting machine. This brought a multiple benefit; vertical integration, aroma at the point of sale, credibility and increased profit. When House of Fraser invited us to open a third site at Rackhams of Birmingham, it was at the banks suggestion that we should try for our own site. This led to acquiring a lease at 15 St Johns Wood High Street in 1983. We had by this time embarked on the wholesale side of coffee supply to local restaurants and with the acquisition of the lease at St Johns Wood installed a 25 kilo professional coffee roasting machine in order to become self sufficient with our coffee. We considered franchising as a possible means of further expansion. The St Johns Wood shop was the ideal coffee shop model; a catering led operation, roasting on-site, front and rear access and space for an office. By now the coffee shop offer was growing to include a lunch-time dish of the day. It was around 1988, we received the disappointing news, Barkers was to be redeveloped and all concessions were given 6 months notice to quit. Certainly this was a rude awakening, how quickly 6 months goes. So we acquired the lease of another shop nearby in Kensington Court and then had four sites, all trading in profit, each slightly different. Just as we had spare space in St Johns Wood, so too a basement in Kensington allowed for the acquisition of a proper factory packing machine, allowed us more control, independence and profitability. As we assessed a way forward at that time, the expansion of the wholesale side of the business appealed more and our view that department stores, not delicatessen shops were the place to sell real coffee to the consumer, that led us to target Harrods, Selfridges, Fortnum and Mason and Harvey Nichols. In order to access funds to finance a production facility, we had to sell the lease on one of the two London shops. The first offer was for St Johns Wood, so that sale allowed us the opportunity to put a production facility in place in a railway arch in Camberwell. The successful conclusion of the contract to supply all Harrods retail coffee resulted in the need to acquire plant machinery, printing and packaging which quickly burnt through the  £120,000 that was paid for St Johns Wood and forced the sale of the Kensington shop to give us sufficient cash flow. (The Kensington shop sale was another fascinating lesson in small business management, but not terribly relevant to this). Suffice to say, the timing of the sale was perfect and ultimately led to the opportunity to acquire the freehold of Great Eastern Street. Having successfully become the supplier to Harrods, we added the exclusive supply of coffee by catering and retail to Harvey Nichols (that was juggling) and Selfridges. Today even fifteen years later, we are still in that happy position and whilst we only supply a few fringe coffee beans to Fortnum Mason, as the family owning the store also own Twinnings, we count that as quite an achievement. Our luckiest break on the catering supply side was to supply an espresso machine and coffee to the first Cafà © Rouge also around 1989. This company went on to expand to 120 sites nationally, acquired the Dome chain and instigated the idea of a restaurant being willing to sell a cup of coffee at any time of day. A bit like Barkers, the news in 1995 that Pelican Group was acquired by Whitbread, owners of Costa Coffee, came as a disappointment. Even then it took Costa three years to take the coffee and machine contract away from us. Another major customer is AMT Espresso Bars, established in Oxford around 1993, they had two coffee carts when we discovered the operation. Here were three brothers, passionate about their business and their coffee our coffee. Today with 43 bars nationally focussed in railway stations, there coffee sales are quite remarkable, though naturally confidential. All this brings us to the point. We have helped a number of high profile customers achieve consistent record sales of real coffee our real coffee, but nobody knows, nobody has even heard of Andronicas. (Our coffee produces over 50 million cups annually). We want to continue to develop the business as it is. Continue to sell, supply and develop coffee sales in all of these customers under their brand, but additionally and to different customers we want to sell our brand. The historic and existing business being the income stream to support the next opportunity, but which must remain the primary focus, i.e. the existing business can in no way be jeopardised by the plan for the Future. Our growth might well be limited by that fact, but there is always tomorrow. Our experience and strength are bound up in a passion for the product. From the grower and processor, we import only the finest beans, anybody can say it and they all seem to, even Kenko (part of Kraft Foods) but we have seen their factory and others like it. When you grind their coffee beans they look just like mine. Statistically the UK imports very little fine coffee, so somebody is lying. As always it comes down to money. Today I can buy Arabica coffee for  £1,000 per metric tonne. We actually pay around  £1,800 per tonne so naturally we get something much, much better. It really is that simple. We can only afford to pay more because our customers have the same view, they are willing to pay more because they in turn are saying the same to their customers and so it goes. Be it retail or catering pay more, get better, pay less, get worse. It will always be easy to drive down the price; always it will be pointless. So we have the best green beans, now we have to roast them. Our processing plant is equipped to roast coffee in batches of 1, 12, 60 and 120 kilos. This flexibility is of key strength, but more important than that, immediately after roasting, our coffee is securely packed, excluding all the oxygen immediately. This is only possible with state of the art valve packaging equipment. Whether nitrogen or vacuum packed removing the oxygen is critical to the aroma, taste and life of the coffee. NB you cannot vacuum real coffee twice, it only works when freshly roasted. The public does not understand this fact at all. The third critical ingredient to great coffee we will call the barista, the person who makes the coffee. If person one, the grower, person two, the roaster have not done their job, number three cannot win. However even when one and two have done their job correctly, number three can destroy it. So coffee the nectar of the gods, requires the skill resource and commitment of at least three people to achieve greatness. Given the consumption of coffee in just the UK alone exceeds 150 million cups per day, the scale of both the challenge and the opportunity can only be marvelled at. Andronicas core skill is in understanding the variables and bringing their expertise to endeavour to help the consumer make great coffee. Be it through bars serving it by the cup or at home made by a myriad of equipment from the simple French pot, the sophisticated Italian espresso machine, a German filter system, a Turkish pot or the elegant cafetiere. Going back to the bars, todays fashion is for espresso-based drinks and the machines used to do this form an important part of the companys business model. Espresso machines used extensively in every modern catering environment are a key opportunity to develop new business and a great opportunity to build long term customer relationships, through service, maintenance, training and lead to the identified opportunity here ‘ BRANDING. Traditionally a bar serving espresso purchases beans packed in kilo bags. This is emptied into a hopper feeding the grinder; the coffee is therefore nameless. In order to identify the brand at the point of sale, the outlet might well be given china cups that bear the brand of the coffee roaster. Our idea is to change the pack from bag to tin. Instead of emptying the bag of beans, a 2-kilo tin replaces the unbranded hopper. Vacuum packed at the factory this tin allows us to identify our brand at the point of sale. The additional supply of branded cups, china or paper, and other point of sale material, to get the message across at the time the product is being consumed. This should therefore be self-financing. Accepting that our brand is of no commercial value yet, the means to achieve the trade sale is to additionally personalise the 2 kilo caddy with the clients outlet brand. In other words Andronicas Coffee at †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. Our desire then is to sell our coffee to a new group of trade customers where they are keen to sell the product as Andronicas Coffee. This in itself is not difficult. Coffee is a competitive market, our history, experience and resource make it a relatively straight-forward proposition. An investment in manpower, accessories to support the offer, the process is essentially similar to our current programme. Moving beyond this, the reason for creating the brand in the first place is to get back to our retail roots and to create value in Andronicas Coffee as a brand and therefore as a business. We have already indicated that access to market in the retail arena is through supermarkets, departments stores, speciality coffee retailers or mail order. Our view is the supermarkets are not an appropriate route for our company taking account of our existing customer base, our size and brand recognition. We are established in retail through department stores and therefore any activity to promote our coffee would be like shooting yourself in the foot. Speciality coffee retailers are unlikely to support our brand and are in any event a fragmented group, which brings us to mail order. Back-tracking a moment picture a coffee salesman visiting an espresso bar. His objective is to persuade the bar owner to change coffee suppliers. Having made that change and assuming everything the salesman says is true, one would have every reason to suppose that espresso bar owner would continue to purchase a case of espresso beans every week indefinitely. That is what Andronicas does, it persuades espresso bar owners it has great coffee, will not change the blend, will deliver consistently what they require, will not change the offer, price or any fundamental. Allowing him to offer his customer the same and build his business to such an extent he may open a second espresso bar. Who is he going to call? Picture if you would just for the exercise, a salesman in a car showroom. Imagine for a minute the different objectives of both these sales people. One wants a sale now, today. The other wants a sale indefinitely. They both come from the same place, they are both going somewhere entirely different. Now back to our retail opportunity. The consumer is a little like our espresso bar owner. They want great coffee, easily accessible, at good value for money, consistently. The supermarket fulfils that need extremely well. The only thing missing is the romance. There is no romance with supermarket coffee. We might all like the coffee specialist, but we dont have the time and there is no consistency. Mail order might be able to fulfil these objectives, but the cost of finding these potential customers would be excessive. However if the offer was good and met the requirements, it is conceivable such a person could purchase one 250g tin every week, for ever more.. Just like our espresso bar owner. Buying direct from the roaster, who is also the importer, is the romance. Operationally for us this is simple. The clever or difficult part is identifying those one in ten UK coffee drinkers who really do only drink real coffee at home. Events. Picture if you would any day out you have been on. A county show, a day at the races, museums, air shows, Henley, Wimbledon. We dont even expect a great coffee and we are still disappointed. Imagine being at one of these events and being served a great cup of coffee. Yes, it is possible. Might you think I wish I could get coffee like this at home. That is where we want to get to. Serving coffee in locations, the expectation is low, making a great drink and converting the customer to a mail order user. Difficult as it may be, the beauty of the idea is they are going to pay for the tasting and so building this opportunity should be self-financing and by focussing on this avenue to the consumer, we should not alienate our existing trade customer further we are establishing the brand recognition of Andronicas Coffee to his and our benefit. Andronicas world of coffee 4th floor Harrods Knightsbridge, is a concept Gourmet Coffee shop, where Term Freshly Roasted means just that. Here green coffee beans are roasted to customers specifications in the desired quantity. Having identified, what we consider the right ingredients for the perfect coffee shop, we are focused on the other locations where the concept would be appreciated. By Easter 2010 we will have opened Andronicas World of coffee at Covent Garden, Excel East and West, and Garden Park Peterborough.[5] Structure Of dissertation:- Developing a theoretical framework incorporating a number of ideas and findings relevant to understand the factors affecting Small medium enterprise entry barriers. In Chapter two a substantial body of literature is presented about different marketing strategies and branding models. In Chapter three, the methodology used in research concerned with entering market and brand development is presented. A qualitative research is proposed with the elaboration of focus groups. The use of a guide for the moderator was needed in order to help the researcher to put the research question in parallel with the topics to probe. Also the codification technique is used to organize the information later on. Finally, Chapter four presents the findings of this dissertation, giving an explanation of what the factors influencing the marketing strategies of any small medium enterprise. It also presents a comparison between the factors extracted from different authors and the ones found in this research evoking interesting potential directions for further research. Literature Review â€Å"Perception is strong and sight weak. In strategy it is important to see distant things as if they were close and take a distant view of close things†[6] This chapter is based on brief explanation about how strategies are formed and how they are implemented for any organisation in order to become successful and survive. Strategy is one of the key elements and a major concern for any organisation for its survival in future. Here in this chapter we are trying to explain various theories and concepts that have been put forward. Why Strategy? â€Å"Like politics, strategy is the art of the possible; but few can discern what is possible†.[7] Strategy in terms of business means planning how to reach the objectives of the company and how the planning should be implemented. â€Å"Strategy is a the pattern of major objectives, purpose or goals and essential policies or plans for achieving those goals, stated in such a way as to define what business the company is in or is to be in and the kind of company it is or is to be† Andrews (1971). In simpler terms can be explained as â€Å"The strategy of the firm is the match between its internal capabilities and its external relationship. It describes how it responds to its suppliers, its customers, its competitors and the social and economic environment within it operates† Kay (1993). Andrews definition clearly identifies two different processes, formulation and implementation, and the interrelation between these two concepts. â€Å"Strategy as the determination of the basic long term goals and objectives of the enterprise and the adoption of the courses of action and allocation of resources necessary for carrying out those goals† Chandler (1962) Mainly strategy is maintained at three main levels in any organisation. Internal Resources: It means the capital and the investments in the business, employees and their skill sets are resources for the company. To make most of these resources a proper strategy needs to be implemented, and that helps organisations to make most of the resources and that helps to survive and stay in the market. External environment within which the organisation operates: Environment means every aspect external to the organisations. Its not only the economic and political situations but also competitors, customers and suppliers. Organisations need to develop strategies that are best suited to their strengths and weaknesses in relation to the environment in which they are operating. According to Mintzberg H (1987) Environment is so uncertain, particularly in global level, that it may be impossible to plan a long term strategy. This may need to be crafted, i.e. built up gradually through a learning process involving experimentation. Strategies need to be devised to cope with such difficulties The ability of the organisation to add value to what it is doing presently: To ensure long term survival an organisation must take the supplies it brings in, add value to these through its operation and then deliver its output to the customer. The purpose of the strategy is to bring about the conditions under which the organisation is able to create this vital additional value. The strategy that is formulated should also ensure that the organisation adapts the changing circumstances. Strategy of a business is in cooperation with art and a science. Particular strategy will not be appropriate for all the cases. Small and medium companies coming into existence has increased substantially over a period of time. Marketing situation is completely different in small to medium enterprise then larger corporations. Gilmore, Carson and Grant (2001) use the limitations for companies to explain the differences. The limitations are capital, time, marketing knowledge and limited impact on the market place. Marketing strategy in terms of small and medium firms is lot different than multinational and larger firms. According to Gilmore (2001) marketing is casual, amorphous, reflex, and is build in the lead and in compliance to industry norm. Small and medium sized organisations are a very diverse faction. The strength of the company does not decide the purpose and goals of the organisation. This wide range of Small medium organisations can be categorised hooked on three groups Child-, Dwarf- , and pygmy- companies Brytting(1998). This categorization is done on the foundation of organisations ambitions and potential of expansion. Child companies are undersized because they are newly taking place. These companies are on the rise, resolve with time and the right resources increase beyond their present size. Dwarf companies are small because of internal issues. A dwarf company is disabled with its undersized manpower. This type of business needs to develop or else reshuffle in order to be ready for action. Pygmy companies are small because that is most suitable size. Pygmy companies are small because they dont try to grow. They are cost-effective and economical in their current size. Growth is generally qualitative because organisational expansion is not attractive. According to Bryttings (1998) categories give three reasons to give explanation why a company is small. The company is small because it is a new entrant, some is wrong with in the organisation or, it is designed to be small. In marketing a niche brand is strong within its market division, but small in unconditional terms (Doyle 1990). Companies that come under this category can be highly cost-effective without a large share of the market. According to Doyle (1990) it is possible for a small or medium company to receive comparatively better returns on investment then ratio then rest of the market leaders. Bergvall (2001) explains the fact how small and medium sized companies can be successful in their own markets. A small company is more supple and are innovative as they are physically more closer to customers/ market (Bergvall 2001) .Smaller organisations are have a flatter structure in size, that makes decision making process simpler. In current management view, marketplace is captured by communication and exchange of assets involving network partners (Norman Ramirez1998). Drucker (1974), the honoured management guru said â€Å"doing things right,† or efficiently, could not save the company when it was not â€Å"doing the right things† Both operations and strategic management must be done well to be successful, to gain and maintain a competitive advantage. When the world is changing, managers need to share some common view in the new world. Otherwise, decentralized strategic decisions will result in management anarchy. Strategy has both pros and cons: Strategy sets trend: At present this statement has uniformly advantages and disadvantages. The key function of the strategy is to map the road of a business in order to find the approach cohesively all the way through the situation. But the drawback is that occasionally strategic decision can also serve as a set of blinders to hide potential dangers. Strategy focuses effort: Strategy tries to build and promotes team work in an organisation, lacking strategy it can happen that the employees start running in different directions. The drawback on this is faction arises when attempt is too carefully determined, that results in avoid Analysis of Strategies for Expansion into UK Analysis of Strategies for Expansion into UK Introduction Research Content:- Over the last few decades, there has been a tremendous growth in the volume of business. A number of new players have entered the business world and as a result there is fierce competition making survival very difficult. Therefore it is imperative that Companies establish a sustainable competitive advantage over other competitors. One key strategy that companies have often adopted to sustain in the long term is continuous growth to become recognised brand and dominant that they can set the agenda. Thus we see huge multi-national corporate in various sectors particularly in retail, food and beverages that are dominant and sometimes act as monopolies. However, pursuing a strategy of growth simply does not mean that corporate can expand their businesses, survive and remain successful. In the past, many organisations have adopted various strategies and implemented all of them but have failed. This is because like any other strategy, growth strategies must be carefully formulated and prop erly implemented. If not, there could be severe consequences. There are many organisations particularly in the UK that are aspiring to expand their presence. However, a number of huge western based multi-nationals exist that are dominant and follow entry deterrence strategies such as patents, limit pricing, cost advantages, aggressive advertising and marketing etc, in order to prevent other organisations from taking their market share or eroding their margins. We shall study in this dissertation, the growth strategies that such emerging organisations adopt and implement to capture the markets and also see how they encounter the indirect entry barriers imposed by the giant multi-nationals. Aims Objectives The Goal of this dissertation is: to analyse the various strategies that can be composed by an organisation and the ways that they should be implemented; to list the various possible outcomes that can be achieved by an organisation with proper planning and implementation of a strategy; to study the reasons why it is important for organisations to plan and have alternative strategies Even though many companies form strategies and implement them, not all of them may succeed. So, why do companies fail to achieve their objectives with the implemented strategies. The main purpose of this research would be based on Andronicas World Of Coffee (AWOC), the way they work on the strategies they plan and the implementation process to make it a success. A Study would be done on the problem that they have faced and are facing in the present and the past while implementing their Retail business strategies to become a recognized brand. The objective is to complete the study with all the required literature review and theory which relates to strategies formulation and implementation. Analyses the reasons, motives, process and other aspects related to strategies formulation and implementation. The main objective is to have a brief study on how Andronicas- world of coffee has planned its strategy and has implemented it, in order to enter highly competitive market of coffee chains and become a leading Retailer in UK. Analysis will also be done on the performance of this organisation and the growth achieved in short span of time. The objectives that we aim to explore are given below : To Examine the strategies formulated by Andronicas- World of Coffee for establishing their retail business within UK. To analyse the different steps and ideas they used and implemented for establishing their retail business in LONDON. To find out what Andronicas- World of Coffee was and what it is now after the implementation of its formulated strategy. To study the impact of ongoing Financial crisis on Andronicas as a business. Purpose of Study:- The fast growing competition in business market has raised the need for new markets. This has inspired many small organisations to grow and provided opportunities, for which various strategy needs to be formulated. The purpose of research is on what field a company needs to concentrate and what strategy it should apply in order to enter the highly competitive market. The implementation plans of company play a vital role. Even though strategies are planned well but some companies fail during the implementation process, this is because of improper communication/ short term plans. The implementation process needs to be monitored very carefully. The purpose of the study is to identify the strategies that organisations plan and the way they try to implement it. The main aim of this study is to describe a method that can be adopted by Small medium enterprise to enter a highly competitive market that is already dominated by big market players with the Example of Andronicas -World of Coffee. Managers and leaders of companies are constantly involved into decision-making. They use different types of strategy to ensure that their business not only survives but brings profit. . Strategic ideas are relevant for all types of organization, and many of the key issues are the same although they may differ in their relative significance. All businesses in the competitive environment are affected by strategy and strategic issues if not their own, then those of the competition or the external environment[2]. Long-term strategic success requires coordination of the managers efforts and effective structure of the managerial department of the company. Introduction to the Industry Coffee makes us severe, and grave, and philosophical Jonathan Swift, 1722 Possibly the cradle of mankind, the ancient land of Abyssinia, now know as Ethiopia, is the place where coffee was born. In todays world beverages sector comprising of coffee as a sub sector is one of the key segments of the economy having extensive and forward and backward linkages with other key segments of the economy. According to the latest coffee statistics from the International Coffee Organization (ICO), we pour about 1.4 billion cups of coffee a day worldwide. In fact when we look at per capita coffee consumption, the U.K. is #22 on the list with about 5 kilograms of coffee per person per year[3]. The coffee industry has grown rapidly since the 1990s; before Starbucks emerged, people were used to drinking low quality coffee from tins. Starbucks introduced fresh coffee made from top quality beans that have excellent taste and drinks such as the caffe latte and cappuccino, which have helped to fuel the development of the coffee market into a multi million pound industry. The size of UK branded coffee chains have quadrupled from 1999 to 2004, with a current market turnover of over  £1 billion. However, Britains coffee may finally be taking a new direction. Take a walk through London and youll see a rash of trendy independent coffee houses, with blackboards boasting of freshly roasted, Fair Trade beans and organic milk. Retail sales at specialist coffee shops reached  £1 billion for the first time in 2007 and were almost  £1.2 billion in 2008. High street chains such as Costa Coffee, Starbucks and Caffe Nero are also performing well, with 890 new branches of branded coffee shops expected to open before 2012, but they are upping their game to meet our rising expectations. Jeffrey Young, of the consumer analysts Allegra Strategies, says: â€Å"Were seeing a movement to a stronger coffee palate. People say that their Starbucks is not strong enough, that Nero is stronger than their Costa. Thats something that no one was talking about ten years ago. There has been a massive revolution in coffee drinking, from drinking instant or filtered in a polystyrene cup a decade ago to espresso-based drinks made from 100 per cent Arabica beans today.† UK being an upcoming market for coffee shops, with an estimation of more than 11000 outlets opened so far and number still increasing. The total turnover of the whole coffee industry is estimated to be over  £1.63 billion for year 2009.[4] Estimations for year 2010 are expected more than 13000 coffee shops, including small, medium and independent businesses Introduction to Andronicas World of Coffee (Source: Andrew Knight) Form of Ownership: -Andronicas Coffee is a private limited company whose entire share capital is under the control and ownership of Andrew Knight. Andronicas Coffee a coffee roaster/ supplier vertically integrated, accessing green coffee at source, roasting and processing through to the point of sale, via either catering or retail industries and including the equipment required to produce the finished drink. With a 25year history of selling, serving and operating retail outlets, adopting the best of both the Seattle and European model. Focused now on trade sales identifying customers whose ideals of quality, taste and service, expectation are at the top end of the market and who see outlet expansion as the driver for their business. Promotion of our brand identity is important but secondary to the overall success and profitable growth of our business. To develop staff skills and competence to recruit to fill any gaps and to take the opportunity forward, always keeping in mind the potential property opportunity as it arises and being in a position to take it up. Maintaining our commitment to re-invest each year across marketing , new plant, product development and if appropriate acquisition i.e. office coffee service. Not to lose sight of what we have in the pursuit of what we want. Strive to do what we do better always. The company commenced business as a retailer of real coffee in the Kensington department store, Barkers in 1979. The addition of a tasting facility lead to our first conflict the restaurant manager unhappy that we should be offering a free tasting to his potential customers as they walked through the door resulted in some initial difficulty. The compromise reached with the store manager was that we could charge for our sample. This led us to operating one of the first espresso bars in London. It was popular with both the store and customers in equal measure, was extremely profitable, our rent being based on a percentage of sales and led directly to the opportunity to replicate the model at a second House of Fraser store in Londons Victoria, just 18 months after the Kensington store opened. At this time we had installed a small coffee roasting machine. This brought a multiple benefit; vertical integration, aroma at the point of sale, credibility and increased profit. When House of Fraser invited us to open a third site at Rackhams of Birmingham, it was at the banks suggestion that we should try for our own site. This led to acquiring a lease at 15 St Johns Wood High Street in 1983. We had by this time embarked on the wholesale side of coffee supply to local restaurants and with the acquisition of the lease at St Johns Wood installed a 25 kilo professional coffee roasting machine in order to become self sufficient with our coffee. We considered franchising as a possible means of further expansion. The St Johns Wood shop was the ideal coffee shop model; a catering led operation, roasting on-site, front and rear access and space for an office. By now the coffee shop offer was growing to include a lunch-time dish of the day. It was around 1988, we received the disappointing news, Barkers was to be redeveloped and all concessions were given 6 months notice to quit. Certainly this was a rude awakening, how quickly 6 months goes. So we acquired the lease of another shop nearby in Kensington Court and then had four sites, all trading in profit, each slightly different. Just as we had spare space in St Johns Wood, so too a basement in Kensington allowed for the acquisition of a proper factory packing machine, allowed us more control, independence and profitability. As we assessed a way forward at that time, the expansion of the wholesale side of the business appealed more and our view that department stores, not delicatessen shops were the place to sell real coffee to the consumer, that led us to target Harrods, Selfridges, Fortnum and Mason and Harvey Nichols. In order to access funds to finance a production facility, we had to sell the lease on one of the two London shops. The first offer was for St Johns Wood, so that sale allowed us the opportunity to put a production facility in place in a railway arch in Camberwell. The successful conclusion of the contract to supply all Harrods retail coffee resulted in the need to acquire plant machinery, printing and packaging which quickly burnt through the  £120,000 that was paid for St Johns Wood and forced the sale of the Kensington shop to give us sufficient cash flow. (The Kensington shop sale was another fascinating lesson in small business management, but not terribly relevant to this). Suffice to say, the timing of the sale was perfect and ultimately led to the opportunity to acquire the freehold of Great Eastern Street. Having successfully become the supplier to Harrods, we added the exclusive supply of coffee by catering and retail to Harvey Nichols (that was juggling) and Selfridges. Today even fifteen years later, we are still in that happy position and whilst we only supply a few fringe coffee beans to Fortnum Mason, as the family owning the store also own Twinnings, we count that as quite an achievement. Our luckiest break on the catering supply side was to supply an espresso machine and coffee to the first Cafà © Rouge also around 1989. This company went on to expand to 120 sites nationally, acquired the Dome chain and instigated the idea of a restaurant being willing to sell a cup of coffee at any time of day. A bit like Barkers, the news in 1995 that Pelican Group was acquired by Whitbread, owners of Costa Coffee, came as a disappointment. Even then it took Costa three years to take the coffee and machine contract away from us. Another major customer is AMT Espresso Bars, established in Oxford around 1993, they had two coffee carts when we discovered the operation. Here were three brothers, passionate about their business and their coffee our coffee. Today with 43 bars nationally focussed in railway stations, there coffee sales are quite remarkable, though naturally confidential. All this brings us to the point. We have helped a number of high profile customers achieve consistent record sales of real coffee our real coffee, but nobody knows, nobody has even heard of Andronicas. (Our coffee produces over 50 million cups annually). We want to continue to develop the business as it is. Continue to sell, supply and develop coffee sales in all of these customers under their brand, but additionally and to different customers we want to sell our brand. The historic and existing business being the income stream to support the next opportunity, but which must remain the primary focus, i.e. the existing business can in no way be jeopardised by the plan for the Future. Our growth might well be limited by that fact, but there is always tomorrow. Our experience and strength are bound up in a passion for the product. From the grower and processor, we import only the finest beans, anybody can say it and they all seem to, even Kenko (part of Kraft Foods) but we have seen their factory and others like it. When you grind their coffee beans they look just like mine. Statistically the UK imports very little fine coffee, so somebody is lying. As always it comes down to money. Today I can buy Arabica coffee for  £1,000 per metric tonne. We actually pay around  £1,800 per tonne so naturally we get something much, much better. It really is that simple. We can only afford to pay more because our customers have the same view, they are willing to pay more because they in turn are saying the same to their customers and so it goes. Be it retail or catering pay more, get better, pay less, get worse. It will always be easy to drive down the price; always it will be pointless. So we have the best green beans, now we have to roast them. Our processing plant is equipped to roast coffee in batches of 1, 12, 60 and 120 kilos. This flexibility is of key strength, but more important than that, immediately after roasting, our coffee is securely packed, excluding all the oxygen immediately. This is only possible with state of the art valve packaging equipment. Whether nitrogen or vacuum packed removing the oxygen is critical to the aroma, taste and life of the coffee. NB you cannot vacuum real coffee twice, it only works when freshly roasted. The public does not understand this fact at all. The third critical ingredient to great coffee we will call the barista, the person who makes the coffee. If person one, the grower, person two, the roaster have not done their job, number three cannot win. However even when one and two have done their job correctly, number three can destroy it. So coffee the nectar of the gods, requires the skill resource and commitment of at least three people to achieve greatness. Given the consumption of coffee in just the UK alone exceeds 150 million cups per day, the scale of both the challenge and the opportunity can only be marvelled at. Andronicas core skill is in understanding the variables and bringing their expertise to endeavour to help the consumer make great coffee. Be it through bars serving it by the cup or at home made by a myriad of equipment from the simple French pot, the sophisticated Italian espresso machine, a German filter system, a Turkish pot or the elegant cafetiere. Going back to the bars, todays fashion is for espresso-based drinks and the machines used to do this form an important part of the companys business model. Espresso machines used extensively in every modern catering environment are a key opportunity to develop new business and a great opportunity to build long term customer relationships, through service, maintenance, training and lead to the identified opportunity here ‘ BRANDING. Traditionally a bar serving espresso purchases beans packed in kilo bags. This is emptied into a hopper feeding the grinder; the coffee is therefore nameless. In order to identify the brand at the point of sale, the outlet might well be given china cups that bear the brand of the coffee roaster. Our idea is to change the pack from bag to tin. Instead of emptying the bag of beans, a 2-kilo tin replaces the unbranded hopper. Vacuum packed at the factory this tin allows us to identify our brand at the point of sale. The additional supply of branded cups, china or paper, and other point of sale material, to get the message across at the time the product is being consumed. This should therefore be self-financing. Accepting that our brand is of no commercial value yet, the means to achieve the trade sale is to additionally personalise the 2 kilo caddy with the clients outlet brand. In other words Andronicas Coffee at †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. Our desire then is to sell our coffee to a new group of trade customers where they are keen to sell the product as Andronicas Coffee. This in itself is not difficult. Coffee is a competitive market, our history, experience and resource make it a relatively straight-forward proposition. An investment in manpower, accessories to support the offer, the process is essentially similar to our current programme. Moving beyond this, the reason for creating the brand in the first place is to get back to our retail roots and to create value in Andronicas Coffee as a brand and therefore as a business. We have already indicated that access to market in the retail arena is through supermarkets, departments stores, speciality coffee retailers or mail order. Our view is the supermarkets are not an appropriate route for our company taking account of our existing customer base, our size and brand recognition. We are established in retail through department stores and therefore any activity to promote our coffee would be like shooting yourself in the foot. Speciality coffee retailers are unlikely to support our brand and are in any event a fragmented group, which brings us to mail order. Back-tracking a moment picture a coffee salesman visiting an espresso bar. His objective is to persuade the bar owner to change coffee suppliers. Having made that change and assuming everything the salesman says is true, one would have every reason to suppose that espresso bar owner would continue to purchase a case of espresso beans every week indefinitely. That is what Andronicas does, it persuades espresso bar owners it has great coffee, will not change the blend, will deliver consistently what they require, will not change the offer, price or any fundamental. Allowing him to offer his customer the same and build his business to such an extent he may open a second espresso bar. Who is he going to call? Picture if you would just for the exercise, a salesman in a car showroom. Imagine for a minute the different objectives of both these sales people. One wants a sale now, today. The other wants a sale indefinitely. They both come from the same place, they are both going somewhere entirely different. Now back to our retail opportunity. The consumer is a little like our espresso bar owner. They want great coffee, easily accessible, at good value for money, consistently. The supermarket fulfils that need extremely well. The only thing missing is the romance. There is no romance with supermarket coffee. We might all like the coffee specialist, but we dont have the time and there is no consistency. Mail order might be able to fulfil these objectives, but the cost of finding these potential customers would be excessive. However if the offer was good and met the requirements, it is conceivable such a person could purchase one 250g tin every week, for ever more.. Just like our espresso bar owner. Buying direct from the roaster, who is also the importer, is the romance. Operationally for us this is simple. The clever or difficult part is identifying those one in ten UK coffee drinkers who really do only drink real coffee at home. Events. Picture if you would any day out you have been on. A county show, a day at the races, museums, air shows, Henley, Wimbledon. We dont even expect a great coffee and we are still disappointed. Imagine being at one of these events and being served a great cup of coffee. Yes, it is possible. Might you think I wish I could get coffee like this at home. That is where we want to get to. Serving coffee in locations, the expectation is low, making a great drink and converting the customer to a mail order user. Difficult as it may be, the beauty of the idea is they are going to pay for the tasting and so building this opportunity should be self-financing and by focussing on this avenue to the consumer, we should not alienate our existing trade customer further we are establishing the brand recognition of Andronicas Coffee to his and our benefit. Andronicas world of coffee 4th floor Harrods Knightsbridge, is a concept Gourmet Coffee shop, where Term Freshly Roasted means just that. Here green coffee beans are roasted to customers specifications in the desired quantity. Having identified, what we consider the right ingredients for the perfect coffee shop, we are focused on the other locations where the concept would be appreciated. By Easter 2010 we will have opened Andronicas World of coffee at Covent Garden, Excel East and West, and Garden Park Peterborough.[5] Structure Of dissertation:- Developing a theoretical framework incorporating a number of ideas and findings relevant to understand the factors affecting Small medium enterprise entry barriers. In Chapter two a substantial body of literature is presented about different marketing strategies and branding models. In Chapter three, the methodology used in research concerned with entering market and brand development is presented. A qualitative research is proposed with the elaboration of focus groups. The use of a guide for the moderator was needed in order to help the researcher to put the research question in parallel with the topics to probe. Also the codification technique is used to organize the information later on. Finally, Chapter four presents the findings of this dissertation, giving an explanation of what the factors influencing the marketing strategies of any small medium enterprise. It also presents a comparison between the factors extracted from different authors and the ones found in this research evoking interesting potential directions for further research. Literature Review â€Å"Perception is strong and sight weak. In strategy it is important to see distant things as if they were close and take a distant view of close things†[6] This chapter is based on brief explanation about how strategies are formed and how they are implemented for any organisation in order to become successful and survive. Strategy is one of the key elements and a major concern for any organisation for its survival in future. Here in this chapter we are trying to explain various theories and concepts that have been put forward. Why Strategy? â€Å"Like politics, strategy is the art of the possible; but few can discern what is possible†.[7] Strategy in terms of business means planning how to reach the objectives of the company and how the planning should be implemented. â€Å"Strategy is a the pattern of major objectives, purpose or goals and essential policies or plans for achieving those goals, stated in such a way as to define what business the company is in or is to be in and the kind of company it is or is to be† Andrews (1971). In simpler terms can be explained as â€Å"The strategy of the firm is the match between its internal capabilities and its external relationship. It describes how it responds to its suppliers, its customers, its competitors and the social and economic environment within it operates† Kay (1993). Andrews definition clearly identifies two different processes, formulation and implementation, and the interrelation between these two concepts. â€Å"Strategy as the determination of the basic long term goals and objectives of the enterprise and the adoption of the courses of action and allocation of resources necessary for carrying out those goals† Chandler (1962) Mainly strategy is maintained at three main levels in any organisation. Internal Resources: It means the capital and the investments in the business, employees and their skill sets are resources for the company. To make most of these resources a proper strategy needs to be implemented, and that helps organisations to make most of the resources and that helps to survive and stay in the market. External environment within which the organisation operates: Environment means every aspect external to the organisations. Its not only the economic and political situations but also competitors, customers and suppliers. Organisations need to develop strategies that are best suited to their strengths and weaknesses in relation to the environment in which they are operating. According to Mintzberg H (1987) Environment is so uncertain, particularly in global level, that it may be impossible to plan a long term strategy. This may need to be crafted, i.e. built up gradually through a learning process involving experimentation. Strategies need to be devised to cope with such difficulties The ability of the organisation to add value to what it is doing presently: To ensure long term survival an organisation must take the supplies it brings in, add value to these through its operation and then deliver its output to the customer. The purpose of the strategy is to bring about the conditions under which the organisation is able to create this vital additional value. The strategy that is formulated should also ensure that the organisation adapts the changing circumstances. Strategy of a business is in cooperation with art and a science. Particular strategy will not be appropriate for all the cases. Small and medium companies coming into existence has increased substantially over a period of time. Marketing situation is completely different in small to medium enterprise then larger corporations. Gilmore, Carson and Grant (2001) use the limitations for companies to explain the differences. The limitations are capital, time, marketing knowledge and limited impact on the market place. Marketing strategy in terms of small and medium firms is lot different than multinational and larger firms. According to Gilmore (2001) marketing is casual, amorphous, reflex, and is build in the lead and in compliance to industry norm. Small and medium sized organisations are a very diverse faction. The strength of the company does not decide the purpose and goals of the organisation. This wide range of Small medium organisations can be categorised hooked on three groups Child-, Dwarf- , and pygmy- companies Brytting(1998). This categorization is done on the foundation of organisations ambitions and potential of expansion. Child companies are undersized because they are newly taking place. These companies are on the rise, resolve with time and the right resources increase beyond their present size. Dwarf companies are small because of internal issues. A dwarf company is disabled with its undersized manpower. This type of business needs to develop or else reshuffle in order to be ready for action. Pygmy companies are small because that is most suitable size. Pygmy companies are small because they dont try to grow. They are cost-effective and economical in their current size. Growth is generally qualitative because organisational expansion is not attractive. According to Bryttings (1998) categories give three reasons to give explanation why a company is small. The company is small because it is a new entrant, some is wrong with in the organisation or, it is designed to be small. In marketing a niche brand is strong within its market division, but small in unconditional terms (Doyle 1990). Companies that come under this category can be highly cost-effective without a large share of the market. According to Doyle (1990) it is possible for a small or medium company to receive comparatively better returns on investment then ratio then rest of the market leaders. Bergvall (2001) explains the fact how small and medium sized companies can be successful in their own markets. A small company is more supple and are innovative as they are physically more closer to customers/ market (Bergvall 2001) .Smaller organisations are have a flatter structure in size, that makes decision making process simpler. In current management view, marketplace is captured by communication and exchange of assets involving network partners (Norman Ramirez1998). Drucker (1974), the honoured management guru said â€Å"doing things right,† or efficiently, could not save the company when it was not â€Å"doing the right things† Both operations and strategic management must be done well to be successful, to gain and maintain a competitive advantage. When the world is changing, managers need to share some common view in the new world. Otherwise, decentralized strategic decisions will result in management anarchy. Strategy has both pros and cons: Strategy sets trend: At present this statement has uniformly advantages and disadvantages. The key function of the strategy is to map the road of a business in order to find the approach cohesively all the way through the situation. But the drawback is that occasionally strategic decision can also serve as a set of blinders to hide potential dangers. Strategy focuses effort: Strategy tries to build and promotes team work in an organisation, lacking strategy it can happen that the employees start running in different directions. The drawback on this is faction arises when attempt is too carefully determined, that results in avoid

BUSINESS METHODS Essay -- essays research papers

BUSINESS METHODS PEST (Political, Economical Social and Technological environment ) Analysis The external environment of any organisation / university / faculty / department etc. can be analyzed by conducting a PEST analysis. The acronym PEST (sometimes rearranged as STEP) is used to describe a framework for the analysis a range of macro environmental factors including the Political, Economical Social and Technological environment. A PEST analysis fits into an overall environmental scan including the SWOT analysis and McKinsey’s 7S Model, which is briefly discussed below and also referred to in the document ‘Preparing a SWOT Analysis. For a unit (referring to any area under review be it an academic department, a research unit, an administrative unit or a support service unit), a PEST analysis should relate to: 1. The external environment outside of the unit but within UCC, and 2. The external environment outside of UCC, given the national and international profile of the office The PEST analysis provides the following simple framework: Political FactorsPolitical factors can have a direct impact on the way business operates. Decisions made by government affect the operations of units within the university to a varying degree. Political refers to the big and small ‘p’ political forces and influences that may affect the performance of, or the options open to the unit concerned. The political arena has a huge influence upon the regulation of public and private sector businesses, and the spending power of consumers and other businesses, both within UCC and outside of UCC. Political factors include government regulations and legal issues and define both formal and informal rules under which UCC and units must operate. Depending on its role and function within the university a unit may need to consider issues such as: †¢ How stable is the internal/external political environment? †¢ Will government policy influence laws that regulate third level educ ation? †¢ What is the government's policy on the education? †¢ Is the government involved in trading agreements such as the Bologna Agreement? †¢ The impact of employment laws †¢ The impact of environmental regulations †¢ Trade restrictions and tariffs †¢ Political stability (internally and externally †¢ Decision-making structures Economic FactorsAll businesses are affected by economical factors nationally and globally. Whethe... ...mple measures? †¢ A bias for action: a propensity to act, even in the light of incomplete information, rather than to engage in extensive discussion and analysis †¢ Close to the customer: listening to, learning from, and providing exemplary service for their customers -------------------------------------------------------------------------------- Page 5 †¢ Autonomy and entrepreneurship: fostering leaders and innovators throughout the organisation/department; encouraging practical risk taking and tolerating failure †¢ Productivity through people: respect for and validation of staff; recognition that staff are the source of quality and productivity gain †¢ Hands-on, value driven: led by executives that are ‘in touch’ with the essential aspects of the organisation; paying explicit attention to promulgating the organisations core values †¢ Stick to the knitting: operating primarily in fields of established expertise †¢ Simple form, lean staff: characterised by few administrative layers, and uncomplicated systems †¢ Simultaneous loose tight properties: a combination of centralisation and decentralisation; promoting individual autonomy within the boundaries of the organisations core values.

War on Drugs Essay -- Papers Narcotics Drug Society Essays

I. Thesis and Literature Summary In our contemporary society, the media constantly bombards us with horror stories about drugs like crack-cocaine. From them, and probably from no other source, we learn that crack is immediately addictive in every case, we learn that it causes corruption, crazed violence, and almost always leads to death. The government tells us that we are busy fighting a war on drugs and so it gives us various iconic models to despise and detest : we learn to stereotype inner-city minorities as being of drug-infested wastelands and we learn to "witchhunt" drug users within our own communities under the belief that they represent moral sin and pure evil. I believe that these titles and ideals are preposterous and based entirely upon unnecessary and even detrimental ideals promoted by the government to achieve purposes other than those they claim. In Craig Renarman's and Harry Levine's article entitled "The Crack Attack : Politics and Media in America's Latest Drug Scare," the authors attempts to expose and to deal with some of the societal problems that have related from the over-exaggeration of crack-cocaine as an "epidemic problem" in our country. Without detracting attention away from the serious health risks for those few individuals who do use the drug, Renarman and Levine demonstrate how minimally detrimental the current "epidemic" actually is. Early in the article, the authors summarize crack-cocaine's evolutionary history in the U.S. They specifically discuss how the crack-related deaths of two star-athletes fist called wide-spread attention to the problem during the mid-1980's. Since then, the government has reportedly used crack-cocaine as a political scapegoat for many of... ...d substance. Conclusively, we should allow drugs like crack-cocaine receive to their due attention as social problems, but let them receive no more than that !. V. References D'Angelo, Ed. (1994, September). The Moral Culture of Drug Prohibition. Humanist., 54, p. 3. Dorfman, Lori-Wallack, Lawrence. (1993, November). Advertising Health : The Case for Counter-Ads. Public Health Reports., 108, p. 716. Johnson, Bruce-Golub, Andrew et al. (1995, July). Careers in crack, drugs use, drug distribution, and nondrug criminality., Crime & Delinquency, 41, p. 275. Perrine, Daniel. (1994, October 15). The View From Platform Zero : How Holland Handles its Drug Problem. America., 171, p. 9. Renarman, Craig & Levine, Harry G. The Crack Attack : Politics and Media in America's Latest Drug Scare, *From Montclair State Univ. Library

War poetry :: English Literature

War poetry I come from Wooburn common. Somebody had to. When we first moved here it seemed an alright place. There are plenty of fields for sport and stunning views. But these mild advantages are swamped by a thousand and one disadvantages. For example, I still, after four years of living here, am coming to terms with the fact that I'm the only sane person in this village. Even my family seem to be a little on the insane side after living here, but I can't say I blame them. The only entertainment there is: dodging the many vicious animals when you go on walks and trying not to get lost in the uncountable number of trees and wooded areas. It's enough to drive anyone mad! One of the inhabitants of Wooburn Common is "crazy dog man". He has somewhere in the region of 15 dogs which he talks to, not to mention himself, regularly. He is a tall, lanky man, with grey greased back hair and always wears, rain or shine, his dark green rain Mac and Wellington boots. One day, one of his beloved dogs decided to "leave a package" for us, on our lawn for my dad to find. We were unaware at first whose dog did the deed but we treated it as a one off. As we were about to find out this was not the case. Everyday a fresh one was laid; we even put a sign up saying "please do not allow your dog to foul on our verge, or we may have to return the favor". It was no good, the poo just kept coming (by now mostly on the sign itself!) until operation pooper scoop was initiated. A whole day I spent in my sister's car at the end of drive with a pair of binoculars waiting for the now named "phantom pooper" to arrive. Time dragged on, but as I was about to call it a day, "crazy dog man" decided to show his face, dogs and all. It was horrific! One or two of the dogs had diarrhea, but I consoled myself by knowing that I had caught the culprit. It wasn't long before I told my dad. He went, besides a bright scarlet colour, mad, but managed to coolly and calmly place one of the many excretory products in to an envelope and posted through the recipients letter box! A punishment well deserved; but events like this one happen regularly in wooburn common and although reasonably funny, the routine of them happening again and again every week is definitely not. If you live in Wooburn common you have to accept that the main bulk of

Strategic Management: Strategic Directions Folloed by Virgin Atlantic

Contents 1)Executive Summary 2)Introduction of Company 3)External Environment 4)Company Financial Performance 5)Competitive Strategy 6)Strategic Direction of Development 7)Methods of Development 8)Conclusions and Recommendations 9)Resources 10)Appendices 1)Executive Summary This report aims to evaluate the current strategic directions followed by Virgin Atlantic. Initially we discuss the organisation’s mission statement and identify how the vision of the company is reflected though the strategic objectives. It is established at CSR plays an important role one Virgin Atlantic as it is seen to have principles and high standards on acceptable behaviour, BBC News (2009). External factors are evaluated using a PESTLE analysis and it is made clear that the Airline Industy as a whole is suffering financially in the economic turndown. With the well publicised fear of global warming and the level of emissions airlines are giving off is resulting in the government putting pressure on Virgin Atlantic and others to find ways of reducing their C02 output by increasing fuel costs, Virgin Atlantic (2009). Social trends are examined to determine the appeal of air travel and why consumers continue to fly with luxury airlines like Virgin Atlantic over smaller no frills airlines. The financial performance of Virgin Atlantic is analysed over a 5 year period looking at key ratios to determine the sales and profitability of the organisation. These results are compared to British Airways financial figures as well as Ryanair’s to get a better understanding of how financially secure Virgin Airline is financially in comparison to its competitors. An analysis is then conducted of the organisations competitive strategy which identifies, using Porters 5 Forces, that Virgin Atlantic fall under ‘differentiation focus strategy’ as they offer premium priced products for a high quality service. Results from Ansoff’s growth vector determine the strategic direction of the Airlines development. The airline’s growth remains competitive through demand in existing markets with existing products as well as newly developed ones. The methods of development are identified as code-sharing agreements between different airlines, allowing them to make use of each other’s resources at minimum costs. It was concluded that, due to the success of Virgin Atlantic’s current 3 year strategic direction, the airline should extend this strategy. Other strategic concepts where recommended regarding the fight for climate change and they way in which the airline positions itself through branding. 2)Introduction to Company Virgin Atlantic was launched by founder Richard Branson on the 22nd June 1984 Virgin Airline (2009). . 1. The vision of the airline was to offer high quality services combined with good value for money. Working in Music industry for many years Branson himself knew little about the aviation industry therefore he used the advice of his partner, Freddie Fields to manage the venture along with his technical manager Roy Gardner Management Today (1998). As a result of working in the Music Industry Bra nson was all too familiar with celebrity obsessed culture and thus he packed the first flight was between London and Newark Liberty with some well known celebrities. Virgin Atlantic credit the use of the famous faces seen travelling on the inaugural fight as one of the factors of success in launching the airline, Virgin Atlantic (2009). 2. 2. Virgin Atlantic employs a three year strategy which thus far has proved successful. The success has been down to their sound business model which is defined by their Mission Statement: â€Å"To Grow a profitable airline, where people love to fly and people love to work. † Virgin Atlantic (2009) Low cost airlines offer a typically narrow service where as Virgin Atlantic, through their code-sharing agreements; position themselves as offering a broad range of exotic destinations for people who are willing to pay premium prices. This business model has the key understanding that the way in which the product is positioned and the experience provided travelling by virgin Atlantic, will ensure customers will travel again and again thus allowing them to achieve their long-term strategic objectives of increasing profits and shareholder values. 2. One of the key factors in the business model is ‘how’ Virgin Atlantic provide a unique flying experience, virgin maintain this positive feeling with the friendly flight attendants and the positive attitudes they show customers. The airline ensures the happiness of staff with fair wage, discounts on fairs as well as loyalty schemes. The most public display of loyalty towards staff was in 2009 when Virgin Atlantic employees were given 2 free flights to any of the airlines destinations as part of the 25th anniversary of Virgin Atlantic Daily Mail (2009). This generosity towards the staff has the same principles applied by its airline services, the idea of luxury onboard the aircrafts and the knowledge that you will be taken care of. 2. 4. Thomson and Martin (2005) believe that customers play a key part in an organisations business model as they are ones who the services are specifically tailored to. In the 80’s when Virgin Atlantic’s vision was launched, the glamour of air travel had distinguished and air travel was seen as an expensive means of getting from a to b. People had forgotten what air travel was all about, and the ideal of jet setting across the world in luxury was seen available only to those who where famous. The vision introduced encouraged people to pay more but have better value for money and made the whole air travel experience pleasurable. Virgins Growth is testimite to how effective the initial vision of the company was and shows that their mission today is exactly what customers are looking for in a service provider. 2. 5. Corporate Social Responsibility also takes a key stance in Virgin Atlantic’s business model. The company’s strong stance in responsible business is heavily publicised by the media, especially when it comes to environmental factors. Richard Branson has publicly pledged to invest profits of his travel organisations into the research and development of alternative fuel and renewable energy Mallen Baker (2006). â€Å"Virgin Atlantic is committed to reducing our environmental impacts where we can by becoming a more efficient business, leading the industry to practical and technical solutions and engaging, inspiring and empowering our staff and customers to help us meet this challenge† Virgin Atlantic (2009). . 6. The airline was also the first of its kind to trial an alternative fuel which was created from a combination of coconuts and Brazilian Babassu nuts, BBC News 2008. Virgin Airline also have strong policies on equality and avoiding discrimination, this was pushed into the media when 13 of the airlines staff where sacked after describing the passengers as â₠¬Ëœchavs’ on the social networking site Facebook, a spokesperson for the airline stated â€Å"It is impossible for these cabin crew members to uphold [our] high standards of customer service†¦ f they hold these views. † BBC News 2008. This very public stance on social responsibility, especially when it comes to environmental factors, enforces the public interest that Virgin Atlantic employ especially when it comes to decision making and setting their strategic objectives. Reidenbach and Robin (1995) have produced a spectrum of 5 ethical/unethical responses and I believe that Virgin Airline would fall under Ethically Engaged and, â€Å"Actively want to do ‘the right thing’ and be seen doing so† The companies mission states that they want to be a profitable airline & their CSR stance assures the consumers that Virgin Atlantic have principles and although they want to be a profitable airline they will not achieve this strategic objective expense of the planet and the people who inhabit it. 3)External Factors There are a number of external factors which can affect not only the environmental stability of Virgin Atlantic but the attractiveness of the airline industry as a whole. Such factors can be determined by conducting a PESTLE Analysis, a PESTLE Analysis is a business model designed by looks at 6 different factors (Political, Economic, Social, Technological, Legal & Ethical Issues) and aims to evaluate the impact these factors will have on the Organisation. 3. 1. Political &Legal Factors The main political factors which affect the airline industries stability and attractiveness is the current tax policy employed by the government. Due to the rapid decrease of sustainable fuels and with concerns of global warming stronger than ever the Conservative party plan to increase the Air Passenger Duty (APD) up to 113% by November 2010 if they win at the election, Virgin Airline (2009). This will mean an increase in fares thus affecting the attractiveness of the air travel & may have significant impacts on Virgin Airlines profits. Interest rates set by the government may affect any loans that the Airline have taken out. The exchange rates on currency may also provide issues when the company need to trade currency for customers on board an aircraft moving between the uk and America etc. Legal factors which may affect the attractiveness of the airline industry would be legislation on health & safely, wages and airline regulations in terms of training and quality standards. Code-sharing agreements, which we have established plays a key role in the success and growth or Virgin Atlantic, may be put in to jeopardy if there is conflict between countries which could potential affect the air space in which Virgin Atlantic travels. It would be important for the company to have alternative routes put in place allowing them to still get to their chartered destinations in case this type of situation were to occur. Starting in 2012, the EU union will require all airlines to hold emission permits in order to operate; this was designed as a means of reducing the production of greenhouse gases. This is something which will effect Virgin Atlantic & they will have to do research into the costs of the permits & analysis how this will affect the company financially. 3. 2. Economic Factors The economic factors affecting the airline industry as a whole would be mainly the current economy. With less disposable income the demand for travel has fallen The Times (2009), and the airline may to look at competing with low budget airlines in 2010. The business side of air travel is the most expensive to run and has been affected the worst with the rises in fuel costs Mintel Report (2007). Branson has stated publically that the airline would no doubt overcome the recession but that the first class aspect of air travel would dwindle, Daily Mail (2009). The financial information reported, which will be addressed in the next section ‘Company Financial Performance’ , indicates that Branson’s prediction is correct and that that Virgin Airline will remain stable despite the current recession. This is one such scenario which Virgin Atlantic must address and research in order to determine the environmental stability of the organisation and the ability for it to achieve the 3 year strategy in place. As a result of the recession, Virgin let go off 7% of all employees in 2009 and may have to consider the possibility of letting more go in 2010. The airline is not alone as their main competitor British Airways let 4000 jobs go, Daily Mail (2009). 3. 3. Social Factors & Ethical Issues The main social trend which could impact the airline industries attractiveness would be attitudes and emphasis on safety. After the terrorist attacks in September 2001, the thought if flying was unbearable to most. There is still the threat of terrorism and thus it’s no surprise that many individuals are still concerned about their safety when flying. Virgin Atlantic would have to make sure that they have procedures in place to deal with such situations and ease any concerns individuals have about flying. They have set up a course for those individuals who have a fear of flying which takes place in Local Airports Virgin Atlantic (2010). As previously stated there is an obsession with the celebrity culture and the ideal of traveling to exotic locations in luxury, going into the next decade it is important that this trend of social status remains important and ‘popular’ as this is the brand image which Virgin Atlantic is associated with. If this social factor was to change it would severely impact the attractiveness of the airline industry and subsequently the demand for Virgin Atlantic’s services would be affected. The main ethical issue which is affecting the attractiveness of the airline industry is the emissions let of by the aircrafts. Aviation is responsible for 2% of emissions worldwide and global warming is a huge issue in today’s society, with many individuals dedicated to the social trend of ‘going green’ in a bid to save the planet. Virgin Atlantic remain actively involved in the research and development of alternative sustainable fuels and have joined a voluntary agreement proposed by the airline industry to reduce emissions by 50% in 2050 compared to that of 2005 . 3. 4 Technological Factors Virgin Atlantic has been at the forefront of technology, starting in the eighties when it was the first airline to have individual Televisions for its Business Class Passengers, Virgin Atlantic (2009). With technology in the aviation industry developing from year to year, from new air craft models which reduce emissions to efficient means of checking in customers nd the great entertainment facilities on board makes air travel is very appealing. Virgin Atlantic offer great entertainment systems as well as spacious and luxury air travel in their Airbus A380, which is the world’s first twin deck aircraft offering a fully functioning restaurant’s and bar’s, Boston (2009). This level of technology in the A3 80 sets the airline before is competitors such as BA and low budget airlines can simply not compete with the level of comfort provided on board. 4)Company Financial Performance Despite harsh conditions of the external environment, namely the recession, Virgin Atlantic have remained a successful and profitable airline. In this section, the financial performance of the airline will be analysed over a 4 year period and compared to its main competitor British Airways as well as popular low budget airline Ryanair. 4. 1. The first area we will look at is turnover. The turnover indicates the level of business that each airline has achieved over a yearly period, changes in turnover can be impacted by changes in external factors which result in a decrease of sales. Virgin Atlantic’s turnover is much less compared to their competitors. This is not a true indication of the financial performance of an organisation but the money they derive from sales can indicate the demand one airlines service over another. Although a company may have a high sales turnover, the real profitability is determined by taking the pre-tax profits and dividing these by the turnover, Thomson and Martin 2005. 4. 2. Pre-tax profits To establish the financial success of the Virgin Atlantic we will firstly look at the pre-tax profits of the airline & that of its chosen competitors. Pre-tax profits – Ryanair (thousand 000) Ryanair (2005/9) Pre-tax profits- British Airways (Millions ? ) British Airways (2005/9) They key factor to note in all three pre-tax profits charts is that the recession in 2008 has impacted both low frills airlines and British Airways. Both airline reported losses, the most significant being that of BA at ? 401 Million. Despite the external factor of climate change Virgin Atlantic has managed to not only sustain its financial performance but to almost doubled their pre-tax profits from the previous year, with recorded pre-tax profits of ? 68. 4 Million. 4. 3. Profit Margin Virgin Atlantic is the only one to have maintained their profit margin over 2008. Ryanair & British Airways have made significant losses, whilst Virgin Atlantic’s profit margin is growing. This just shows how much of an impact the economy has on the airline industry and means that Virgin Atlantic will have to keep cost of sales, administration, the selling and distribution costs of tickets down in order to remain profitable. 4. 4. Gearing Ratio The average gearing ratio in the airline industry is around 150% while some companies who are struggling in the recession are as high as 380%. Another key statistic in determining Virgin Atlantics financial position is the gearing ratio. The gearing ratio measures the return on capital employed and indicates any financial risks. The principle is that the higher the gearing ratio the more vunerable the company is. Year Gearing (%) 2005 284. 76 2006 209. 82 2007 199. 92 2008 189. 44 2009 183. 18 As you can see from the table above Virgin Atlantic is slightly over the recommended average in the aviation industry but their vulnerability and financial risk is decreasing year on year following the demand for their services. 5. Competitive Strategy A clear competitive strategy is key in the success of an organisation meeting its strategic objectives. In order to establish Virgin Atlantic’s Competitive strategy we will be using Porters Generic Strategic Framework, a diagram is shown below. According to Porters theory there are 5 forces used to analyse the industry; 5. 1. â€Å"Threat of New Entrants. † As with any industry the more new airlines that enter the market, the more saturated it becomes. The most important factors in the airline industry in retaining loyalty are brand name recognition and frequent fliers point s. Virgin Atlantic have spent the past 25 years building their polished and somewhat sexy image which is so appealing to flyers today. Virgin Atlantics strong brand name and discounts for loyal air travellers will give them the power to gain a customer even if its prices are slightly higher than its competitors. 5. 2. â€Å"Power of Suppliers. † Boeing and Airbus are two of the main air craft manufacturers. Their aircrafts are used by Virgin Atlantic and majority of its competitors, therefore there is no real competition between them. 5. 3 â€Å"Power of Buyers. Due to there being a low choice in suppliers in the aviation industry and taking into account that switching all Virgin Atlantics 38 air crafts to another supplier would be very costly, the airline do not have power over the suppliers. 5. 4. â€Å"Availability of Substitutes. † Substitute products and services may be a concern of some airlines, especially smaller regional firms. However when it comes to Virgin Atl antic they have routes to some of the best locations in the world, of course there are other premium fare airlines which go to the same destinations but they will not have the same brand image as Virgin. It would just be up to the individual travelling and probably concern the cost difference between Virgin Atlantic and its Competitors. 5. 5. â€Å"Competitive Rivalry. † There is a certain degree of rivalry in the aviation industry, especially between Virgin Atlantic and British airways. The affects of the competition are more clear in a economic turndown, for example BA’s loss of 401 million the year ending won’t be helped by Virgin Atlantic’s 25th Anniversary which was celebrated all though 2009, offering special promotions and discounted rates. 5. 6. This Analysis would indicate that Virgin Atlantic would fall under differentiation focus strategy. By offering premium priced products for a high quality service Virgin Atlantic has an advantage over its competitors. Porter (1980) 6. Strategic Direction of Development The main strategic direction flowed by Virgin Atlantic in to increase the airlines market share. This growth has been the main strategic objective since 2008 when it was introduced in a 3 year plan. According to Ansoff’s Matrix there are four main types of growth, Ansoff (1987). Virgin Atlantic’s strategic direction would fall under both market penetration & Product Development. The existing market which Virgin Atlantic operates in continues to have a growing demand for the current services which the airline offer. The growth in demand is due to several of the external factors which were discussed earlier, namely the social trend of luxury air travel and the idea of jet setting around the world with a company associated with celebrities and seen to been sexy. The growth in demand is identified in the increased ticket sales over the past few years despite the current recession which is affecting other premium airlines Virgin Atlantic continue to out-grow its competitors. The strategic direction of increasing market share could not come at a better time for Virgin with British Airways in massive dept and in a very vulnerable position. It is no secret that if BA were unable to operate that Virgin Atlantic would see a significant increase in the market share. Despite the success of the existing services in the existing markets, it is well known that Virgin Atlantic drive for innovation in product development. As established in the external environmental analysis airline have been at the forefront of technology since they launched in the eighties. By continually updating their fleet of air crafts with the newest gadgets and luxuries, the airlines passengers have a better experience on board and are more likely to travel time and time again with the airline. 7. Methods of Development 7. 1. In order for Virgin Atlantic Airline to grow it entered into a code share agreement with some of the larger names in the airline industry these included Continental Airlines & Jet Airways iloveinda. com (2009). Code sharing agreements are used by companies to make the most of each other’s resources and according to the Air Transport Association, Code-sharing agreements allow two (or more) airlines to offer a broader array of services to their customers than they could individually. These marketing arrangements enable an airline to issue tickets on a flight operated by another airline as if it were its own, including the use of its own two-letter code for that flight. These arrangements allow airlines to market expanded networks for the ir passengers at minimal expense† Air Transport Association (2009) 7. 2. In 1999 Virgin Atlantic also partnered with Singapore airlines who now own 49% of the company, Richard Branson signed the deal as he believed it to be an effective way of offering their customers a wider range of destinations at competitive rates BBC News (1999). 8. Conclusions and Recommendations The diagram created by Rowe et Al in 1989, can be used to determine Virgin Atlantics Strategic direction and determines what type of strategy the airline should undertake going forward. Rowe et Al developed this model based on which he considered to be four important variables. The financial strength of the airline and the advantage it has over its competing airlines makes up the internal strategic direction and the stability of the economy along with the attractiveness of the airline industry as a whole. Throughout this report, the strategic direction of Virgin Atlantic has been discussed and the methods of development evaluated alongside airlines financial performance, taking into consideration the external environment. As a result of this analysis and though Rowe at Al’s Space Analysis we can conclude that the airline is not only using a aggressive strategy but that their approach is highly competitive. The current strategy employed by Virgin Atlantic is very successful and is essentially the reason why the organisation has remained profitable in such times as a recession. I would recommend that Virgin Atlantic extend the current strategy over a longer period of time, all of the areas in this report echo the success of the strategy and how well it fits into the organisations business model. They must make sure that they continue to brand themselves as having a unique selling point with an emphasis on value for money in order to remain competitive. Another recommendation would be to keep the economy boarding which they have on flights, i believe that if this element was stripped away altogether then the airline would further narrow their market further and reduce the potential market shares. With the voluntary target set in the airline industry on cutting emissions by 2050, I would encourage Virgin Atlantic to take a more public stance and be actively involved in the research and development of bio fuels by pairing up with the lead organisation. This would enforce the airlines stance of ethical issues regarding global warming. The way in which the organisation brands itself, being sexy & tongue in cheek, has been constantly one of the most important factors in the airlines success. I recommend that message conveyed with the airlines ’25 years still red hot campaign’ is carried on throughout 2010. Page 12 References Airline Network (2007) ‘Virgin Atlantic Passenger Traffic Increase’ Online at http://www. get-packing. com/news/flights/archives/august-2007/virgin-atlantic-passenger-traffic-increase. html (Accessed 19th November 2009) Air Transport Association ‘Airline Handbook, Chapter 2, Code Sharing’ online at http://www. airlines. rg/products/AirlineHandbookCh2. htm (Accessed 1st January 2010) Boston (2009) ‘Virgin Atlantic’s Airbus A380’ online at http://images. google. co. uk/imgres? imgurl=http://cache. boston. com/bonzai-fba/Third_Party_Photo/2005/01/18/1106063427_8542. jpg&imgrefurl=http://www. boston. com/business/gallery/airbus/&usg=__tA9Pr Cq_sbXx6TAWpndBbvcOSrc=&h=333&w=508&sz=28&hl=en&start=7&um=1&tbnid=wm5v998e2jOptM:&tbnh=86&tbnw=131&prev=/images%3Fq%3Dvirgin%2Bairbus%26hl%3Den%26rlz%3D1T4TSEH_enGB359GB359%26sa%3DN%26um%3D1 (Accessed online 20th November 2009) BBC News (2008)’Airline in first biofuel flight’ online at http://news. bc. co. uk/1/hi/7261214. stm (Accessed 10th of December 2009). BBC News, ‘Branson sells 49% of Virgin Atlantic’ online at http://news. bbc. co. uk/1/hi/business/572516. stm (Accessed 19th November 2009) BBC News (2008) ‘Crew sacked over Facebook posts’ online at http://news. bbc. co. uk/1/hi/uk/7703129. stm (Accessed 10th December 2009 The Daily Mail (2009) ‘Like A Virgin (Pin-Up): kate Moss Dresses up In A Red Playsuit As She Joins Branson for Virgin Atlantic’s 25th Birthday’ online at http://www. dailymail. co. k/tvshowbiz/article-1194691/Like-A-Virgin-Pin–Kate-Moss-dresses-red-joins-Branson-Virgin-Atlantics-25th-birthd ay. html (Accessed 20th November 2009) The Daily Mail (2009) ‘Virgin Staff Get Bonuses While Ailing Rivals BA Urged to Take Pay Cut’ online at http://www. dailymail. co. uk/news/article-1194942/Virgin-staff-bonuses-ailing-rivals-BA-urged-pay-cut. html (Accessed 19th November 2009) Iloveindia. com ‘Virgin Atlantic Airways’ online at http://www. iloveindia. com/airlines-in-india/international/virgin-atlantic. htm