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Purpose
This assignment is intended to help you learn to do the following:
Collect industry data from a variety of secondary sources.
Analyze industry data.
Develop an environmental scan and industry analysis.
Section 1: Overview
In this assignment, you and your cross-functional team will conduct an Industry Analysis of the coffee industry. The process of developing an industry analysis includes:
Scan (collect) industry data.
Analyze the collected data. You might think of this step as turning raw data into information. Look for patterns, opportunities, and threats that may face GCC.
Summarize, in narrative form, your findings and insights to inform GCC’s strategic decision-making.
Create corresponding Exhibits and Appendices.
Section 2: Cross-functional Team Member Assignments
Make sure to revisit your team stewardship agreement document and assign responsibility for each element of this assignment. Note that page numbers refer to the Hunger & Wheelen (2011) textbook. Remember that you can access this textbook from your functional capstone course site (FINA 495, HRM 495, or MKTG 495).
Assignment Elements
1.1 Value Chain Analysis pp. 56 and 57
1.1.1 Supply channel members
1.1.2 Volatility
1.1.3 Size, demand, trends of coffee production
1.1.4 Size, demand, trends of coffee retail industry
1.2 Michael Porter’s 5 forces + 1 – figure 3.4, pp. 37 to 40
1.2.1 Threat of new entrants
1.2.2 Competitive rivalry
1.2.3 Threat of substitute products or services
1.2.4 Bargaining power of buyers
1.2.5 Bargaining power of suppliers
1.2.6 Relative power of stakeholders?
1.3 Product lifecycle – figure 4.4, pp. 61 and 62
Section 3: Research Resources
Before any analysis can be performed, relevant data must be gathered. This is often referred to as “scanning.” You are looking for data that can be used to inform GCC’s strategic decision-making. Use the following resources and materials to complete this assignment:
Cross-functional Business Capstone GuideLinks to an external site.
Strategic Planning: External Analysis an Online course with David ParrishLinks to an external site.
Information on how to access and use your group homepage. Links to this information are provided on the Navigating this Course page.
Section 4: Research Prompts
Use the following prompts to help guide your research and analysis for each section of the assignment. In each case, you will collect data, analyze it, and provide a summary of your findings and insights that will inform GCC’s decision-making on the given topic.
1.1 Value Chain Analysis pp. 56 and 57
Supplier Analysis: Investigate the suppliers within the value chain of the coffee industry. What are the key inputs or raw materials they provide? Assess their reliability, quality, and cost-effectiveness. How do they impact the overall value chain performance and competitive advantage of the industry?
Internal Process Analysis: Examine the internal processes involved in the value chain, from production and operations to distribution and customer service. Identify areas of efficiency, bottlenecks, or potential improvement. What are the key activities that contribute to value creation? Are there any opportunities for streamlining processes or enhancing productivity?
Customer Analysis: Study the needs, preferences, and behaviors of the end customers within the value chain. What are their expectations and demands? How does the value chain deliver value to the customers? Are there any unmet needs or opportunities for differentiation? Evaluate the customer feedback and satisfaction levels to understand the effectiveness of the value chain in meeting customer expectations.
Competitor Analysis: Analyze the value chains of key competitors in the industry. What are their strengths and weaknesses in terms of value creation? How do their value chain activities compare to yours? Identify areas where competitors have a competitive advantage or where your value chain can gain a competitive edge. What strategies can be employed to differentiate and outperform competitors?
Partnership Analysis: Explore the relationships and collaborations with partners or stakeholders within the value chain. How do these partnerships contribute to value creation? Assess the reliability, effectiveness, and alignment of interests with key partners. Are there any opportunities for collaboration or joint value creation initiatives that can improve the overall performance of the value chain?
1.2 Michael Porter’s 5 forces + 1 – figure 3.4, pp. 37 to 40
Industry Rivalry Analysis: Investigate the level of competition within the coffee industry. What are the key factors driving competition among existing companies? Assess the intensity of rivalry based on market share, growth rates, product differentiation, and pricing strategies. How do organizations compete in terms of marketing, innovation, and customer loyalty? Identify any barriers to entry or exit that influence the competitive dynamics.
Supplier Power Analysis: Examine the power and influence of suppliers in the industry. Identify the key suppliers and assess their ability to dictate terms, prices, or quality of inputs. How concentrated is the supplier base? Are there alternative sources of supply? Analyze the cost of switching suppliers and the impact on profitability. Evaluate any potential risks or dependencies associated with the suppliers’ power.
Buyer Power Analysis: Investigate the power and influence of buyers within the industry. Who are the major customers or buyers? Assess their bargaining power in terms of volume, concentration, or switching costs. Are there alternative products or suppliers available to buyers? Analyze their price sensitivity, ability to negotiate, or demand for customization. Identify any factors that can strengthen or weaken buyer power.
Threat of New Entrants Analysis: Assess the barriers to entry for potential new entrants in the industry. What are the economies of scale, capital requirements, or technological barriers that deter new players? Evaluate the existing distribution networks, brand loyalty, or regulatory restrictions. Are there any incumbents with established cost advantages or patents? Analyze the potential impact of new entrants on industry profitability.
Threat of Substitutes Analysis: Examine the threat of substitutes to the industry’s products or services. Identify potential substitute products or alternative solutions that can fulfill similar customer needs. Assess the relative price-performance ratio and the ease of switching to substitutes. Analyze any emerging trends or disruptive technologies that can pose a threat to the industry’s offerings.
1.3 Product lifecycle – figure 4.4, pp. 61 and 62
Product Adoption and Introduction: Investigate the initial phase of the product lifecycle. What are the key factors influencing the adoption of the product by consumers or businesses? Assess the target market’s awareness, interest, and evaluation of the new product. Analyze the marketing strategies employed during the introduction phase and their effectiveness in generating initial sales and market penetration.
Growth and Market Expansion: Study the growth phase of the product lifecycle. What are the factors driving the increasing demand and market expansion? Identify the market segments or customer groups contributing to the growth. Analyze the competitive landscape and the strategies employed by competitors to capture market share. Assess the pricing, distribution, and promotional activities during this phase and their impact on sales growth.
Maturity and Market Saturation: Examine the maturity phase of the product lifecycle. How has the market evolved, and what are the challenges faced during this phase? Evaluate the level of market saturation and the impact on sales growth. Assess the competition, price competition, and the level of product differentiation. Investigate strategies employed to extend the product’s life cycle, such as product enhancements, diversification, or targeting new market segments.
Decline and Product Exit: Analyze the decline phase of the product lifecycle. What are the factors contributing to the decline in demand and sales? Identify the emerging technologies, changing consumer preferences, or substitute products that affect the product’s viability. Evaluate the profitability and the decision-making process for product exit or discontinuation. Investigate strategies employed to manage the decline phase, such as cost-cutting, product diversification, or targeted marketing efforts.
Product Lifecycle Extension Strategies: Explore strategies employed to extend the product’s lifecycle. Investigate product enhancements, rebranding, or product line extensions aimed at revitalizing sales. Evaluate the effectiveness of these strategies and their impact on the product’s competitiveness and market share. Assess the consumer perception and acceptance of the extended product offerings.
Action Items
Review the Great Cups of Coffee (GCC) case, available on the GCC Resources page.
Review the information on how to access and use your group’s home page. Links to this information are provided on the Navigating this Course page.
Re-visit the GCC Stewardship Agreement and confirm who will complete each element of the assignment.
Complete your Environmental Scan & Industry Analysis as directed in Sections 1, 2, 3, and 4 above.
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