SOLUTION: UTS Bunnings Warehouse Strategic Analysis Report

INTB605 Business Strategy
Individual Analysis
Assignment
Name:Xuanming Ye
ID:19065991
1. Industry Profile
10 Marks
The case study organization, Bunnings, operates in the Home-Improvement Retail Industry.
Home-Improvement Retail Industry is a segment within the whole retail industry chain that focuses
on providing consumers with household hardware. The Home Improvement Retail industry is a
multi-billion sector with an estimated growth rate of about three percent over the past years (Dart,
2020). For instance, between March 2012 and September 2017, the industry had recorded a
skyrocketing growth from NZ$620 billion to NZ$ 1051 billion. The industry within the New
Zealand market holds numerous small and large format stores that compete against each other for a
larger market share, and the large format stores include Mitre 10, PlaceMakers, Bunnings, Carters,
and ITM. The key industry players compete on both physical and online geographical orientation,
with the physical-oriented geographic firms diversifying to different geographic locations. The
industry services only the consumers of home improvement services. The consumers include
individuals’ customers who source the industry players’ services to improve their respective homes.
Major companies in the industry have adopted strategies, such as strategic alliances, pricing
incentives, business-oriented structuring, and economies of scale adaptation, to differentiate from
one another in the market.
2. Competitor Profiles
20 Marks
a) Complete a table of key competitors: (5 Marks)
Competitors
Number of
Target
Pricing
Market
stores
customer
strategy
position/
segments
Bunnings
51
growth focus
Consumer and
Common
High growth
trade
pricing with
and innovation
price guarantee
Mitre 10
92
Consumer and
Store-based
trade
pricing with
Market Leaders
price guarantee
ITM
90
Trade
Store-based
Restructuring
pricing
PlaceMakers
58
Consumer and
Store-based
High growth
trade
pricing
rate and
innovation
Carters
50
Trade
b) Complete a Strategic Group Map: (5 marks)
PM
Price **
Mitre
10
Bunnin
gs
**product line**
Store-based
Slow growth
pricing
rate
c) Summarising key aspects of the industry from a) & b) (10 marks):
Three key industry players, which include Bunnings New Zealand, Mitre 10, and PlaceMakers,
shape the Home Improvement retail industry in New Zealand. The three key industry players deal in
similar products, presenting a low substitute switching cost. Although the firms have different stores
within the market, they target the same customer segment and are oriented towards high growth and
innovation. Therefore, it is concrete to conclude that the Home Improvement retail industry in New
Zealand is characterized by a high growth rate and innovation and targets only the customers and trade
customer segment. Pricing strategy also has a significant role in the industry. Although most firms in the
industry have adopted store-based pricing strategy, price guarantee is slowly taking shape. Industry
players with low pricing models that support price guarantees tend to have a larger market share than
those implementing the fixed store-based pricing strategy. The geographic scope also has a significant
impact on the industry’s competitive nature. Industry players with an enormous geographic range reach
more target customer segments than those with a small geographic scope. Conclusively, the competitive
strategy of the Home Improvement retail industry in New Zealand is characterized by low switching
costs, high growth rate, customer segmentation, pricing schemes, and geographic scope.
3. Industry Analysis (Porter’s 5 Forces)
20 Marks
Porter’s Five Forces model analyzes an industry using fives forces, which include threats of new
entrants, bargaining power of suppliers, threats of substitutes, bargaining power of buyers, and
competitive rivalry. The threats of new entrants focus on the industry’s entry attractiveness and barriers.
New Zealand’s Home Improvement industry has a high opportunity cost due to its robust revenue
resources, making the industry more attractive. Moreover, the industry has low barriers to entry due to
moderate economies of scale, low buyer switching costs, easy access to distribution channels, and few
government policies and regulations. The suppliers in the industry have moderate bargaining power as
they are relatively small in size, have complete control of forwarding integration since the key industry
players are responsible for product distribution channels. The threat of substitutes in the industry is low
as customer needs are fulfilled within the industry. The buyers in the industry have high bargaining
power, as the number of buyers relative to the key industry players is low. Moreover, the industry has a
low backward integration and a moderate buyer switching cost, which is price sensitive. The competitive
rivalry in the industry is high since the key industry players are diversifying to different geographic areas
for more market share. Moreover, high growth rates and low exit barriers are driven by pricing strategies
that characterize the industry.
From Porter’s Five Forces analysis, it is evident that the New Zealand Home Improvement Retail
Industry has a moderate-high assessment on threats of new entrants with a high rating on a large scale.
The bargaining power of suppliers has a moderate-low assessment with a very low rating on a large
scale. The threat of substitute has a moderate-low assessment with a very low rating on a large scale,
while the bargaining powers of buyers has a moderate-high assessment with a high rating on a large
scale. The competitive rivalry has a moderate-high assessment with a high rating on a large scale.
Conclusively, the industry is highly profitable as significant profit is achievable both at assessment and
at scale.
Industry-wide, there is a high threat of new entrants due to high opportunities costs and low
barriers to entry. However, the threat is moderately lower due to the high brand reputation and moderate
economies of scale to operate at scale.
4. Driving Forces (From PEST+/PESTLE)
20 MARKS
a) Summarise your PEST+ research below, including at least two supporting references for
each trend (10 Marks):
Dimension
Trend
Political
Launching growth-oriented approaches to the industry policies (Office of
the Minister for Economic Development, 2019; Cabinet Office, 2019).
Economic
Simplifying business regulation and tax environment policies (Ministry of
Business, Innovation & Employment, 2020; Ministry of Business,
Innovation & Employment, 2021).
Increase in inflation rate (McDermott & Williams, 2018; Cabinet Office,
2019).
Sociocultural
Increase in minimum wage rates (Maré & Hyslop, 2021; Davenport, 2020).
Shifting of cultural purchasing practice
Changing consumer lifestyle
Technological Adoption of mobile Apps as purchasing platforms
Ecological
Increase of use online ordering services
Awareness increase in environmental sustainability
Global
Increase in infrastructural development
Difficulties in breaking the international economies of scale
b) Choose the most influential 2-3 trends, and use these to form a driving forces analysis (10
Marks):
The political trend of simplifying New Zealand’s business and tax environment regulations
restructures governmental policies, which could be barriers to market entry, thus presenting
investment opportunities for local and foreign investors. The trend is likely to open up the Home
Improvement industry for threats of the new entrance. Moreover, the trend is expected to lower the
tax rate in the industry, exposing the industry players to more profits and diversification into
international markets. The trend will also likely increase the opportunity cost of the industry, making
it attractive to both local and foreign investors, as simplifying the business and tax environment
eliminates overzealous laws and procedures that hinder possible investments. Another key trend is
the socio-cultural trend of changing consumer lifestyle from leisure prone to a busy schedule. The
trend is shaping the Home Improvement industry by directing the industry players to adopt a hybrid
retailing culture consisting of both online and face-to-face retailing. With the trend, most industry
players have shifted from physical stores to online stores where potential customers can access the
products at their comfort. The trend will likely push the industry players to entire online operation
reducing the physical stores to warehouses for value addition. Another key trend is an increase in
infrastructure development. The increase in infrastructural development would reduce the industry’s
delivery time and provide easy accessibility to the industry players’ physical stores. Moreover, the
trend would open up the industry for more investment since the infrastructure is vital for business
operation.
5. Strategic Issues: Opportunities & Threats
20 Marks
Opportunities
The Home Improvement retail industry is experiencing a robust growth rate, evident in the industry profile.
The robust growth rate experienced in the industry presents an opportunity for the industry players to maximize the
resources and derive maximum profit. An industry experiencing a growth rate is usually profitable, and every
investor wishes to capture an absolute market share. However, the underlying strategic question beholding the
opportunity is how long the industry will experience growth.
The industry structure, characterized by low switching cost, customer segmentation, high growth rate,
pricing strategies, and geographic scope, presents an opportunity in the industry. The factors present the industry as
a competitive market with diverse competitive strategies that any investor can easily rely on for market advantage.
However, the underlying strategic issue is how the competitive strategies can be implemented to produce a
competitive advantage.
The technological adoption evident in the driving forces framework presents the industry to diversify to
online retailing. With online retailing, the industry is exposed to more customer segments in and outside the New
Zealand borders. Leveraging technology into a rapidly growing market-based sector increases the industry’s
viability to diversify to different geographical areas. However, the underlying strategic issue here is the impact of
technology on the numerous physical stores.
Threats
As evident in the industry profile, limited customer segments pose a threat to the Home Improvement
industry. An industry with a narrow customer segment is bound to fail when the demand siphons out the
equilibrium equation. Although a limited customer segment creates perfect competition within the industry, the
strategic issue arises when the target customers switch costs to alternatives.
The introduction of price guarantees in the industry’s pricing strategy poses a threat to the industry’s
profitability. Price guarantee lowers the selling price to a point below the competitors’ price. Although price
guarantee improves the industry players’ ability to introduce a new product line into the market and gain a larger
market share, the strategic issue is what will happen if the companies lower their price below the cost of production.
References:
10 Marks
Cabinet Office. (2019, May). Cabinet Economic Development Committee Minute of
Decision: Next Steps on Industry Strategy. Ministry of Business, Innovation &
Employment. https://www.mbie.govt.nz/dmsdocument/5948-next-steps-on-industrystrategy-minute-of-decision
Dart, G. (2020, April). Home improvement industry market report. Hardware Journal.
https://hardwarejournal.com.au/home-improvement-industry-market-report-by-geoffdart/
Davenport, G. (2020, July). National Labour Law Profile: New Zealand. International Labour
Organization. https://www.ilo.org/ifpdial/information-resources/national-labour-lawprofiles/WCMS_158915/lang–en/index.htm
Maré, D. C., & Hyslop, D. (2021). Minimum Wages in New Zealand: Policy and practice in
the 21st century.
McDermott, J., & Williams, R. (2018). Inflation Targeting in New Zealand: An Experience in
Evolution| Conference–2018.
Ministry of Business, Innovation & Employment. (2020, July 27). Rules & law. New Zealand
Now. https://www.newzealandnow.govt.nz/invest-innovate-in-new-zealand/nzsbusiness-environment/rules-law
Ministry of Business, Innovation & Employment. (2021, March 17). Investing made easy.
New Zealand Now. https://www.newzealandnow.govt.nz/invest-innovate-in-newzealand/nzs-business-environment/investing-made-easy
Office of the Minister for Economic Development. (2019, February). Refocusing the
Approach to Industry Policy. Industry Policy. Economic Development, New Zealand.
Porter, M. E. (1980). Industry Structure and Competitive Strategy: Keys to Profitability.
Financial Analysts Journal, 36(4), 30–41. https://doi.org/10.2469/faj.v36.n4.30
Mowatt, S., Hurd, F., & Fraser, A. (nd). Bunnings New Zealand: Time to think outside the
(Big) Box?
Assessment 2: Strategic Analysis Report
Marking rubric
Overall Grade:
Days Late:
Adjusted Grade:
Executive
Summary
Indicators of
Indicators of
Indicators of
Indicators of
ACHIEVED WITH
DISTINCTION
ACHIEVED WITH MERIT
ACHIEVED
NOT ACHIEVED
Executive Summary clearly
Mostly effective executive
highlights all key points of the summary highlighting most key
report, including key strategic points but with limitations.
issues.
External Analysis Insightful application of all
required frameworks and
concepts, demonstrating
strong engagement with, and
complete understanding of,
course material.
Only minor gaps in application
of required frameworks and
concepts resulting in overall
effective analysis that
demonstrates generally good
understanding of course
material.
Only minor gaps in application
Internal Analysis Insightful application of all
required frameworks and
of required frameworks and
concepts, demonstrating
concepts resulting in overall
strong engagement with, and effective analysis that
complete understanding of, demonstrates generally good
course material.
understanding of course
material.
Strategic Issues Company’s strategic issues, Mostly clear identification of
problems and challenges
strategic Issues, comprising a
stated and justified extremely generally sound combination of
well. Issues are a clear
internal and external analysis
culmination of all analyses, insights. Links to analyses may
drawing on the SWOT
need strengthening, but are
framework to bring together consistent with findings.
the key points from across
the analysis frameworks.
Executive summary adequate but Ineffective or missing executive
tending towards descriptive of
summary.
report structure rather than
highlighting key points.
Analysis follows required process
but with numerous limitations in
application of frameworks,
resulting in ineffective analysis
that demonstrates a lack of
understanding.
Limited engagement with course
content evident in
misapplication and/or clear
misunderstanding of
frameworks and concepts.
Analysis features significant
limitations.
Analysis follows required process Limited engagement with course
but with numerous limitations in content evident in misapplication
application of frameworks,
and/or clear misunderstanding of
resulting in ineffective analysis
frameworks and concepts.
that demonstrates a lack of
Analysis features significant
understanding.
limitations.
Identification of strategic issues Identification of Strategic issues
demonstrates some insight but
may demonstrate little insight or
are not clearly linked to analyses. connection to analysis.
Assertions may be inconsistent
with some analysis findings.
Communication
Expression,
grammar and
spelling
Written expression is clear
and concise with accurate
spelling and grammar. Well
proofread with minimal
errors.
Sources &
Referencing
Sources consistently and
Sources consistently referenced
correctly referenced with no, but with a few errors or
or only minor, errors or
inconsistencies in referencing
inconsistencies. Uses a wide style. Uses a wide range of
range of sources which are all sources which are mostly of
high quality.
high quality.
Referencing evident but
numerous errors or
inconsistencies in referencing
format. Uses a wide range of
sources but some may not be of
acceptable quality.
Format and
structure
Appropriate, correct and
consistent use of
recommended format and
structure.
Excellent detailed appendices
which contain all required
frameworks alongside
additional supporting
evidence to add depth to
analysis.
Some inconsistencies in business Unacceptable format and
report format and/or structure. structure.
Appendices
Minor inconsistencies in written Inconsistent or sometimes unclear Substandard written expression,
expression and/or spelling and/or written expression and/or errors meaning unclear, substantial
grammar.
in spelling and/or grammar.
spelling and/or grammar errors.
Minor inconsistencies or
inaccuracies in report format
and/or structure.
Mostly effective appendices
Includes appendices with
containing all required analysis
frameworks, but these have
frameworks, although more
significant limitations, e.g.,
supporting evidence is required to frameworks may not be
deepen analysis.
completed correctly or might
not contain enough detail to be
useful for decision makers.
Note: Not all criteria carry equal weight
Please refer to Turnitin comments for specific feedback.
Substantial omissions and errors in
referencing. May use
inappropriate or very few sources,
and/or rely heavily on others’
analyses.
Unsatisfactory appendices, e.g.,
frameworks may be missing or not
completed as demonstrated in the
course.
*Company Name* in *year*
Strategic Analysis Report
Name & ID
*Date*
IMPORTANT: Please delete all instructions in this document prior to submission – including this
instruction. You should keep all the headings, page breaks, and section numbering format, but may
modify or adapt the figures or tables as you fit.
Executive Summary
One-page summary of the entire report, including:



Purpose of Report
Key points of analysis
Key issues
TIP: The Executive summary is not an Introduction to the report nor is it a summary of the structure
of the report. An Executive Summary is a summary of all the key points of analysis and key findings.
An Executive Summary should enable an executive (e.g., the CEO) to understand all the main points in
a report without having to read the report in its entirety.
2
1. Introduction
One short paragraph (about 150 words) that briefly states the purpose of the report, the company
name and its industry, and the structure of the report.
TIP: The Introduction simply introduces the report and its structure. It does not perform the function
of the Executive Summary!
2. External Analysis
IMPORTANT: Providing you got a good grade for Assessment 1 (i.e., in the A range) you may copy
and paste YOUR work only into these External Analysis sections and the corresponding appendices. If
your grade was more modest (i.e., a B or less) make sure you update and improve your work to
make it suitable for inclusion here. Please note, copying and pasting any work (including your own) is
normally considered plagiarism and should not be done in any other assessments at AUT. However,
as this assessment builds directly on Assessment 1, we will allow it this time as an exception.
2.1. Industry Profile
Summarise the key characteristics of the industry here. Include:






Industry Name
Size
Growth rate
Competitors
Geographic scope
Key customers
2.2. Competitor Profiles
Following the process learned in Week 3, summarise the findings from your strategic group mapping
exercise and competitor profile table (that you should insert as appendices).
2.3. Competitive Analysis (P5F)
Following the process learned in Week 3, summarise the implications of yo…
Purchase answer to see full
attachment

Haven’t Found The Relevant Content? Hire a Subject Expert to Help You With
SOLUTION: UTS Bunnings Warehouse Strategic Analysis Report
Post Your Own Question And Get A Custom Answer
Hire Writer
Written Assignments
Get 20% Discount on This Paper
Pages (550 words)
Approximate price: -

Why Choose Us?

Quality Papers

We value our clients. For this reason, we ensure that each paper is written carefully as per the instructions provided by the client. Our editing team also checks all the papers to ensure that they have been completed as per the expectations.

Professional Academic Writers

Over the years, our Written Assignments has managed to secure the most qualified, reliable and experienced team of writers. The company has also ensured continued training and development of the team members to ensure that it keeps up with the rising Academic Trends.

Affordable Prices

Our prices are fairly priced in such a way that ensures affordability. Additionally, you can get a free price quotation by clicking on the "Place Order" button.

On-Time delivery

We pay strict attention to deadlines. For this reason, we ensure that all papers are submitted earlier, even before the deadline indicated by the customer. For this reason, the client can go through the work and review everything.

100% Originality

At Written Assignments, all papers are plagiarism-free as they are written from scratch. We have taken strict measures to ensure that there is no similarity on all papers and that citations are included as per the standards set.

Customer Support 24/7

Our support team is readily available to provide any guidance/help on our platform at any time of the day/night. Feel free to contact us via the Chat window or support email: support@writtenassignments.com.

Try it now!

Order Now to Get 20% Discount

We'll send you the first draft for approval by at
Total price:
$0.00

How our best essay writing service works?

Follow these simple steps to get your paper done

Place your order

Fill in the order form and provide all details of your assignment.

Proceed with the payment

Choose the payment system that suits you most.

Receive the final file

Once your paper is ready, we will email it to you.

Our Services

Written Assignments has stood as the world’s leading custom essay writing paper services provider. Once you enter all the details in the order form under the place order button, the rest is up to us.

Essays

Cheapest Essay Writing Service

At Written Assignments, we prioritize all aspects that bring about a good grade such as impeccable grammar, proper structure, zero plagiarism and conformance to guidelines. Our experienced team of writers will help you completed your essays and other assignments.

Admissions

Admission and Business Papers

Be assured that you’ll get accepted to the Master’s level program at any university once you enter all the details in the order form. We won’t leave you here; we will also help you secure a good position in your aspired workplace by creating an outstanding resume or portfolio once you place an order.

Editing

Editing and Proofreading

Our skilled editing and writing team will help you restructure your paper, paraphrase, correct grammar and replace plagiarized sections on your paper just on time. The service is geared toward eliminating any mistakes and rather enhancing better quality.

Coursework

Technical papers

We have writers in almost all fields including the most technical fields. You don’t have to worry about the complexity of your paper. Simply enter as many details as possible in the place order section.