Porter’s Five Forces: UMUC Haircuts
This is a business case study for UMUC Haircuts business for it to be competitive in the growing industry. When the owner was starting up the business, it was the only one in the area and hence it ripped good returns. Currently, so many businesses of a similar type are being set up in the same area.
The paper applies Porter Five Forces model in identifying strategies for the business to gain a competitive advantage over the upcoming salons and beauty parlors in the area. The internal and external business opportunities and processes are also analyzed to come up with the requirement for information system to solve the problem. Analysis of Porter’s five forces for the business of UMUC Haircuts.
FORCE EXPLANATION (Minimum 2 good sentences) IMPACT (POSITIVE, NEGATIVE, or NEUTRAL) AFFECT STRATEGY? (YES/NO) BUYER POWER
It means that the buyer is always right and UMUC should serve the customers according to the way they demand. This force implies that the buyers should be given a good period whenever they visit the business even if they are busy and cannot offer services then, they would rather outsource but get the customer served. For instance, when a customer walks into UMUC demanding to be served and the employees are all occupied, they should give him a chance for service and help them understand that there are people who had arrived before them, hence the need to wait. Again, in case the customers are asking for services that are not offered in the business, they should give them hope that plans are underway to offer these services.negativeyes
The supplier power determines the availability of the materials required to offer the services at the business. Suppose a supplier is asked to supply some materials and they fail, then the business might even close down until they avail the materials. The Supplier holds the business at stake. The supplier supplies as per request. If the UMUC Haircut has delay in ordering for the good, then the supplier will cause unintended delay as well. In UMUC when they forget to ask for the materials o time, the supplier also takes time to deliver.
THREAT OF SUBSTITUTE PRODUCTS OR SERVICES
The substitute substances are a threat to the business since some of the customers may opt to go for them and disregard what UMUC offers. Some substitute services like dreadlock services instead of plaiting hair could make the business loss the customers. Other products like home made chemicals will make the customers prefer them since they are cheap than buying from UMUC. This leads to a lesser income and the business may become irrelevant in the market. The business therefore needs to offer better products and services to give the customers no reason for substitute products.
THREAT OF NEW ENTRANTS
New entrants offer competition to the business and may fetch customers from UMUC. Currently, many people are starting similar businesses to that of Myra. This …