Competitive Environments of a Business- Free-Samples for Students

Question: Assess the General and the Competitive Environments That the Company May Face if they try to Expand in Kenya. Answer: Introduction We Work is an American business enterprise that aims to provide its clients with a shared space of work (Wework.com, 2017). It also provides services and communities for the freelancers, entrepreneurs, small businesses, startups and the other large business firms. Headquartered in New York City, the company was founded in 2010. The company was founded by Adam Neumann and Miguel McKelvey (Wework.com, 2017). The company is known for building and designing virtual and physical communities for the entrepreneurs to share office space and other services. The following report attempts to assess the general and the competitive environments that the company may face if they try to expand in Kenya. The overall goal of the report is to help the concern with the long-term opportunities for growth of the concerned business. Discussion The major ways to analyze the competitive environments of a business is to analyze the concerned area with the help of the Porters five-force model (Dlken 2014). The PEST Analysis is needed to analyze the political, economic, social and the technological aspects of the company that may be necessary to help the concern to expand in their country of choice (Shabanova 2015). PEST Analysis The PEST Analysis of the company analyses the political, economic, social and technological aspects that might be taken into consideration. Political factors The legal system of the country is found to be a blend of the Islamic law, the English common law and the customary law. The trade practices of the country are restricted. The Land Act, the Condominium and Mortgage Financing Act are strict thereby not allowing the real estate market to be active. Economic factors The rates of interest and inflation highly influence the cost of the financing of the housing projects that in turn increase the cost of the apartments that the company plans to provide. The access to the long term funds, the low levels of income and the informality of the risks to credit, the high rates of interest and the lack of supply in case of new constructions (Njoroge 2013). Social factors Growth of population Changes in the lifestyle changes Attitudes towards the concepts of leisure and work Technological factors Provisions of multi-level car parking Installation of security software Error free wireless internet connection Porters Five Force Analysis The Porters Five Force model helps the concerned company to have an idea of the challenges that it may face in the concerned area of expansion (E. Dobbs 2014). There are five factors involved in the above-mentioned analysis Industry Rivalry The sharing industry is an upcoming trendy industry that seems to be more competitive. The industry rivalry refers to the rivalry amongst the concerns that work in the same business sector or provide the clients with similar products (Rothaermel 2015). We Work may face a high level of threats from the existing companies like Design Build, offering the same benefits to the clientele. The company may find it difficult to attract the customers of the other companies. Thus, they may have to deal with a smaller client base on expanding to the new market at Kenya. Buyer Power We Work may also be affected by the number of the companies that provide the clients with similar products and services. This may in turn affect the annual turnover of the concerned company. They provide their clients with the option to share the workspace. This may prove to be an advantage that they have over the other competitors like Gebeya. Supplier Power The companies that provide their clients with shared workspaces do not own the assets that they provide. Thus, the owner of these assets do have a say in the matters that they may or may not allow on the properties that have been let out for the sharing purposes. The suppliers also have a say in the price that is set by the company, We Work in this case. This also may affect the annual income of the company. Threats of New Entrants In the case of We Work, the threats faced due to the new entrants is medium. The concept of the shared workspaces is trendy in todays world. A number of firms are found to be interested in this work arrangement. The advantage of being one of the first movers that the company in discussion has over the other competitors is important (Njeru, Stephen and Wambui 2013). The costs of starting up the company is high. This prevents the competitors from entering the market thereby reducing the threats to the annual turnover of the company. Threats of Substitutes We Work faces a medium level of threat from the substitutes in the field of its work. There are plenty of traditional options available for workspaces that may be provided by the company that may include hotels, single homes. A number of customers in the modern times are on the look for options to share workspaces because of their added advantage of being cheaper. These arrangements add value to the company, as they are less accurate in the personnel projections. Recommendations The company must focus on the advantage of being the first company of its kind to be expanding in Kenya. In order to achieve success, they should concentrate on the uniqueness of the products and services that they offer. There should be enough creativity in the products that they aim to sell. The company may also try to expand in the country by providing their customers with broader spaces that can be shared for the purpose of work Conclusion In conclusion, to the above discussion, it may be said that there exists high prospects of flourishing of the company, We Work if they plan to expand in the Kenyan market. The population of the country being high, the annual turnover of the company may face a huge gain if the company expands in this area. The analyses of both the competitive market and the general external environment are seen to be favorable for the expansion of We Work in the Southern and Eastern African market, especially in the country of Kenya. References Dlken, F., 2014.Are porters five competitive forces still applicable? a critical examination concerning the relevance for todays business(Bachelor's thesis, University of Twente).Dobbs, M., 2014. Guidelines for applying Porter's five forces framework: a set of industry analysis templates.Competitiveness Review,24(1), pp.32-45. Njeru, N.E., Stephen, M.M. and Wambui, M.A., 2013. Analysis of factors influencing formulation of strategic plans in Embu North District, Embu County, Kenya.Global Business and Economics Research Journal,2(5), pp.116-129. Njoroge, S.G., 2013. Operations stratergies in Kenyas real estate sector.Unpublished MBA research project. Rothaermel, F.T., 2015.Strategic management. McGraw-Hill Education. Shabanova, L.B., Ismagilova, G.N., Salimov, L.N. and Akhmadeev, M.G., 2015. PEST-Analysis and SWOT-Analysis as the most important tools to strengthen the competitive advantages of commercial enterprises.Mediterranean Journal of Social Sciences,6(3), p.705. Wework.com (2017).Mission | WeWork. [online] WeWork. Available at: https://www.wework.com/mission [Accessed 14 Nov. 2017]. Wework.com (2017).WeWork Coworking and Office Space. [online] WeWork. Available at: https://www.wework.com/ [Accessed 14 Nov. 2017].