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ID: 343821 • Letter: R
Question
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essay
Competitive strategy of Mr bean is overall cost leadership the idea of everyday low prices is to offer products at a cheaper rate than competitors on a consistent basis, rather than relying on sales mr bean able to keep prices low through a division of labour that allows it to hire and train inexperienced employees rather than trained cooks. It also relies on few managers who typically earn higher wages. These staff savings allow the company to offer its foods for bargain prices. There are a lot of competitor in hong kong this help mr bean to bring the business above average return even in a niche. Its will help mr bean increase its market share and maximize the profits also It will attract large portion of potential customers find paying low prices for goods and services of acceptable quality to be very appealing. Mr bean will have more capital resources available to fund growth or further investments. Mr bean basic operating costs are low, can put more money into research and development, technology upgrades and other business expansion.
Competitive Rivalry or Competition with Mr bean (Strong Force)
The soya bean industry has many firms of various sizes, such as global chains, traditional soya bean and innovative. Also, most medium and large firms aggressively market their products. In addition, Mr Bean’s customers may experience low switching costs, which means that they can easily transfer to other restaurants, such as Wendy’s.
2Bargaining Power of Mr beans Suppliers (Weak Force) Mr Bean lack of regional or global alliances among suppliers. In relation, most of Mr Bean’s suppliers are not vertically integrated. This means that they do not control the distribution network linked to Mr Bean facilities. Also, the relative abundance of materials like flour and soybean reduces suppliers’ influence on McDonald’s.
3) Bargaining Power of Mr bean’s Customers/Buyers (Strong Force)
Because of the ease of changing from one restaurant to another (low switching costs), customers can easily impose their demands on Mr bean. In relation, because of market saturation, consumers can choose from many soya bean outlet other than Mr bean . Also, there are many substitutes to firms like Mr bean ’s. These substitutes include food outlets, artisanal bakeries, as well as foods that one could cook at home.
4Threat of Substitutes or Substitution (Strong Force)
There are many substitutes to Mr beans products, such as products from artisanal food producers and local bakeries. Consumers can also cook their food at home. It is also easy to shift from Mr beans’s to these substitutes (low switching costs). In addition, these substitutes are competitive in terms of quality and consumer satisfaction
5Threat of New Entrants or New Entry (Moderate Force)
New entrants can impact Mr bean market share Because of the low switching costs, consumers can easily move from mr bean toward new fast food soyabean outlet . Also, the moderate capital costs of establishing a new restaurant makes it moderately easy for small or medium-sized firms to affect mr bean
Explanation / Answer
Answer:
The competitive strategy followed by Mr.Bean is the overall cost leadership where they offer products at low prices than their competitors.He follows this strategy by division of labor and hires inexperienced employees and train them rather than focusing on trained cooks.They rely on managers who earn higher wages to carry out the activities.He acquires market share in Hong Kong and turns his business profits above average even in times of niche.By acquiring the market share he maximizes the profits and also has attracted large number of customers with his low pricing products by offering at a acceptable quality which appeals the customers.His operating costs are low so he can expand his business by investing money in further growth,in research and development etc
Competitive rivalry:
The soya bean industry operates in various firm sizes like global chains,traditional beans etc and they aggressively market their products,But inspite of it Mr Bean low pricing strategy offered advantages for customers by low switching costs so that they can switch to other restaurants like Wendy
Bargaining power of suppliers:
They lack in regional and global alliances with suppliers and they are not vertically integrated.They also are not strong in distribution network with other supplier facilities
Bargaining power of buyers:
Because of low switching costs,customers pose demand on Mr.Bean and customers have many alternatives with other firms like food outlets,bakeries etc
Threat of substitutes:
There are many substitutes for Mr Bean like artisanal food producers and local bakeries.The customers can also cook at home.
Threat of new entrants:
New entrants can impact the market share of Mr Bean and the customers can easily move to ther new entrants like new fast food soyabean outlets.Small or medium sized firms also affect mr bean
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