Business Plan Chile SWOT - Research Paper Example

Chile Summary SWOT analysis As strategic business planning is based on the SWOT analysis, it is a handy tool to examine internal and external environmental factors of a particular business. The following table gives the brief details of these factors; which are also detailed in the following paragraphs: Internal factors External factors Strengths As any company’s strengths indicate its position in terms of competitive advantage, the firm’s resources and capabilities determine its strengths. While Best Buy Co. Inc. grew steadily, since its foundation in 1996, its main strengths included innovation and continuous transformation into a dynamic-customer driven company that focuses on enhancing their customers’ enjoyment of technology. Using its strength in scaling-up the production and services of the company, it has expanded into several cross country branches, with 1,55,000 dedicated and energetic employees, from its single branch operations. This enhances the possibility for the company to open a successful branch in Chile.(Best Buy) While the company has increased its market share substantially, according to a study by Forbes.com; this has enabled the company to approach foreign markets also, as it already enjoys huge popularity in the countries where the company has active operations. Hence the firm can depend on such strengths along with their ability to share success with local community, with their added reputation of creating customer loyalty. Weaknesses The weaknesses of the company would include complicated shipping schedules, undifferentiated product line and much internal interference, which takes longer time to complete a transaction. This can cause damage to business located in foreign areas like Chile where delivery schedule and logistics is important. Best Buy needs strengthening their operations, particularly with regard to its management of logistics and shipping delivery system, in view of the competitive edge of others in this segment…..(OPPapers.com) Opportunities While external environment has created opportunities for Best Buy to increase their market share, the reasons for same include growing use of computers and internet, worldwide. However, the positive brand image of the company is major opportunity for it to establish its presence in other countries. This, along with the availability of their products on-line, gives huge opportunity to the company for its expansion, in terms of more branches and more products…….(Judge and OPPapers.com) Threats Competition from Wal-Mart and circuit city is the greatest threat to the company, as Circuit City is offering customer reviews of its products, which help customers who have little technical knowledge. Best buy do not have any such program…………….(AU Interactive 2010) SWOT Summary for Best Buy While the company has internal strength driven by its total dedication to customer services and paying back generously to the local community, where it operates; the company needs continuous improvement in the operation of its shipping, ware-housing, inventory-management and sales divisions. With its ability to create customer loyalty with positive brand image, the company has good chances of operating successfully in Chile. Products and services Best Buy would test the products, to be launched in Chile, first in USA; hence causing some delay in their introduction. However, the product range would include 3D TVs, home appliances, computer devices, mobile phones, cameras, music, movies, games and other technologies, which they are offering from their main branch, along with the services that are currently available in their UK branch. In addition, the company would also be introducing electric scooters, cars, motorcycles and bicycles in Chile. Operations in Chile The company can start from capital of Chile, Santiago which accounts for over 30% of the country’s population, as it caters to most of the country’s commercial and business transactions…..(http://www.studentsoftheworld.info) . Considering the large customer base of the city, the company can have several retail stores in it, which would make the company operations more cost-effective and customer-oriented. Staffing While Chile has large population of working age, which is literate, the only investment company would require making is towards training in Spanish language as most of Chileans do not know English. Being committed to its employees would mean training locals for its operations in retail locations, multiple call centers, product deliveries and community activities. ………………(Best buy Corporate Website) Note on Slide # 8-----Products and Services While Best Buy would offer all products, in Chile, which are sold in their main branch, the company would be also offering all services which are currently available in its UK branch. Accordingly, the products would include three dimension television sets, entertainment devices, home appliances, cameras, mobile phones, music movies and games, apart from entertainment devices and computing technologies. In addition, the company proposes to introduce in Chile their electric cars, scooters, motorcycles and bicycles. The services, which company proposes to offer in Chile would include walk-out working, geek squad, 1-2-1 help, and, trade-in and save, while also offering 0% commission and impartial services. In addition the services would include test drives and price guarantee for all its products. Slide # 9 ------- Operations Santiago being the most densely populated city of the country is also its capital and houses more than 30% population of the country, which has around 67.8% of its population belonging to working age. Accordingly the company can start its operations in Chile from Santiago, which also has advanced technological awareness, as being the center for most of the business and industrial transactions of the country. The city also offers opportunity to open multiple retail stores, which can prove cost-effective for the overall operations of the company, while allowing it to reach all segments of customers throughout the city. Other cities of importance that can be considered by the company could be Concepcion, Vina del Mar and Valparaiso, although each of them has an average population of 300000 against the population of Santiago, which is around 5.5 million. Slide # 10--------Staffing The city of Santiago has almost 95.7% literate population, which is broadly divided into the three different occupations. While around 10% of this population depends on agriculture, almost 20% is engaged in industrial activities. However, the bulk of this work force is engaged in the services sector, being almost 60% of this population. Hence, the company will be at an advantage in finding the suitable human resources to manage its activities in the country. However, the company needs investing in training its staff for learning the English as well as Spanish languages, wherever necessary, since most of the working people in Chile do not know English. Slide # 11----Resources and Budget While Best Buy shares are currently traded in New York stock exchange, the company has reported 7% increase in stores sales, which translates into 14 % increase in its EPS. According to the Best Buy, March 26, 2010 report, it has accumulated net earnings of $779 million, during its fourth fiscal quarter ending Feb 27, 2010, against $ 570 million being net earnings for the company during same period last year. Accordingly this means $1.82 per diluted share, against $1.35 per diluted share, as computed by the end of this period last year. With such vast financial resources, best would not have any difficulty in financing future strategic plans, which may include their expansion towards starting their operations in Chile. Works-cited Primary resources BBest_Buy-Chile_Rev_V5[B].doc Best_Buy_Expansion_plan-Chile.ppt Order_Chile.doc Secondary resources AU Interactive. Retrieved April 22, 2010 from http://blog.auinteractive.com/how-circuit-city-could-steal-market-share-from-best-buy Best Buy. About Us. Retrieved April 22, 2010 from http://www.bby.com/about/ Best Buy. Company Information. Retrieved April 22, 2010 from http://www.bestbuy.com/site/olspage.jsp?id=cat12114&type=page Best Buy Coporate Website. http://www.bby.com. 5 May 2010 BestBuy Corporate Website. http://forums.bestbuy.com . 5 May 2010 http://forums.bestbuy.com/t5/BestBuy-Com/What-is-best-buy-s-main-slogan-and-mission-statement/td-p/60296;jsessionid=E3E21724318BCD2DC868969000CF9E4D http://www.studentsoftheworld.info. 10 October 2006. 5 May 2010 http://www.studentsoftheworld.info/pageinfo_pays.php3?Pays=CHL&Opt=population Internet Center for Management and Business Administration, Inc. SWOT Analysis. Retrieved April 22, 2010 from http://www.quickmba.com/strategy/swot/ Judge, Barry. Retrieved April 22, 2010 from http://barryjudge.com/best-buy-brand-swot-analysis-using-open-principles-test McNamara, Jennifer. http://www.bby.com. 25 March 2010. 5 May 2010 http://www.bby.com/2010/03/25/best-buys-fourth-quarter-diluted-eps/ OPPapers.com. Best Buy SWOT Analysis. Retrieved April 22, 2010 from http://www.oppapers.com/essays/Best-Buy-Swot-Analysis/134008 Vertical Web Media. (13 April 2010). Retrieved April 23, 2010 from http://www.internetretailer.com/dailyNews.asp?id=34395 Read More