Blackmores

Other areas that affect new entry into a market include capital requirements, economies of scale, and brand identity. All of these factors have been discussed to some degree under other

‘Strategy is the direction and scope of an organisation over the long term, which achieves advantage in a changing environment through it’

Factors that can limit the threat of new entrants are known as barriers to entry. In this case barriers to entry are low because: there is no government intervention to prevent businesses from entering the industry, resources are abundant, and customers’ switching costs are low as well as fixed costs to start this type of business.

Strategy is a set of complicated tactics formulated by the executives of a company directed towards the achievement of company’s goal (Salmela, 2002). It is about all the path ways that a company would follow to reach its ultimate goal. It is a company’s strategy which helps to identify what it does better than the other companies in the industries, which may be different from what it does best. For successful strategy formulation and implementation, a company should know the needs of customers and should have knowledge of its competitors. Through a good strategy a company would identify that opportunity which makes it different from the others (Thompson, 2005).

Industry Growth………………………………………….10 Concentration………………………………………….….10 Differentiation and Switching costs……………………13 Scale Economies and Fixed/Variable Costs…………..13 Excess Capacity and Exit Barriers………………………14

• Products:  BKL has a growing range of products that cater for areas in natural health including: Arthritis; Joint, Bone and Muscle; Brain Health; Children 's Health; Cold, Flu and Immunity; Digestive Health; Energy; Everyday Health; Eye Health; Heart and Circulation; Men 's Health; Nails, Hair and Skin; Nutritional Oils; Stress Relief; Teen Health; Weight Management and; Women 's Health.

Strategy formulation has been acknowledged as one of the most crucial factors of ensuring the long-term growth of the business. However, the manner in which strategy is formulated, and most importantly, the nature of the strategy chosen for the company determines its future position in the marketplace (Grant, 2005).

Market entry risks such as cultural differences, competitors, legislation, transportation issues, infringement of intellectual property rights and copyright.

Having strategically acquired rival businesses in the global financial crisis, set up its Botany Paper Mill and making its Australian division independent, Amcor expects its financials to improve dramatically as the ramifications of its moves unfold.

Most office supplies have little brand loyalty, low end-user switching costs, low government regulation, and easy access to suppliers and distribution channels attracts potential new entrants.Economies of scale provide a significant advantage over the larger office supply that allow them to compete with high-volume to lead the market. Company with a strong financial able to gain better profit by negotiate better contracts with suppliers.Entry can be achieved on a smaller scale by focusing on specific productrange or by developing an online retail shop. The low growth in this industry also makes it less attractive to new entrants. Overall, the threat of new entrants is strong (Merketline, 2102)

The first step to analyse strategy is to perform a SWOT analysis. As Daft and Marcic (2011) believe “Formulating strategy often begins with an assessment of the internal and external factors that will affect the organisation’s competitive situation.” (Daft and Marcic, 2011, p.155). So this is where I will begin the analysis.

An organisation’s strategy plays an important role of providing direction of where company wants to be and how best to allocate the company’s resources to meet its objectives. The formulation of business strategies has evolved over the years and has been made more difficult in recent by the uncertain operating environments and global financial crises.

Alfred Chandler(1963) defines strategy as ‘ the determination of the long-run goals and objectives of an enterprise and the adoption of courses of action of an enterprise and the adoption of courses of action and the allocation of resources necessary for carrying out these goals’. And Michael porter(1996) sees it as ‘Competitive strategy is about being different. It means deliberately choosing different set of activities to deliver a unique mix of value’.

The threat of substitutes is the availability of a product that the consumer can purchase instead of the industry’s product (Free management books, n,d ). A substitute product is a product that produced by other industry and offer similar benefits to the customer as the product produced by the firms within the industry. The threat of substitutes can affect the competitive environment for the firm in that industry and also influence the profitability of the industry. This threat affects profitability of the industry because the consumers can choose to purchase similar product from other industry to instead of the company’s product. Besides that, the more the close substitute product can make the industry more competitive and decrease the profit potential of the firm in the industry whereas the less the close substitute product can make the industry less competitive and

A strategy is said to be a plan that is made for the long term success of a product or brand. It is extremely important to have a strategy in order to figure out a direction towards which any company is able to focus all its resources efficiently and achieve desired outcomes. Formulating effective strategies is a considerably long process in itself that combines analysing several factors, situations and issues that are already present in a company and looking to improve on them alongside trying to implement various innovations and ideas to collectively create a direction towards which they can move and direct the resources available to them.