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ECONOMIC
SPECIFIC FACTOR (Describe briefly the factor, provide key data & cite source) Exchange rate Peso to continue appreciating in next 3 years The Philippine Peso will likely continue to appreciate against the US dollar to Ps 38: U$1 (source: BSP, Dec. 2007). Such appreciation to persist due to continuing rise in OFW remittances, rising foreign investments, weak US economy & currency. RELEVANCE TO ENTERPRISE (Elaborate on why or how is the factor relevant to the firm) Since the firm imports 80% of its raw materials that are priced in USD, further appreciate will mean reduced cost for the firm
Interest rate
Labor cost
B. POLITICAL/LEGAL
SPECIFIC FACTOR (Describe briefly the factor, provide key data & cite source) Cheap Medicine Bill Cheap medicine bill finally enacted end 2007 The cheap medicine bill will be finally enacted by Dec. 2007. (source: Philippine Inquirer, issue Dec. 17, 2007) RELEVANCE TO ENTERPRISE (Elaborate on why or how is the factor relevant to the firm) This bill will allow parallel imports of cheaper generic versions of all medicines, including patented ones. This will adversely affected revenues of the firm, particularly many of its leading brands for hypertension, cardiovascular, and diabetes treatments as generic versions are already being produced in China and India.
C. TECHNOLOGICAL
SPECIFIC FACTOR (Describe briefly the factor, provide key data & cite source) Information systems RELEVANCE TO ENTERPRISE (Elaborate on why or how is the factor relevant to the firm)
D. SOCIAL/CULTURAL
SPECIFIC FACTOR (Describe briefly the factor, provide key data & cite source) Changes in lifestyle RELEVANCE TO ENTERPRISE (Elaborate on why or how is the factor relevant to the firm)
E. ENVIRONMENTAL/CLIMATE
SPECIFIC FACTOR (Describe briefly the factor, provide key data & cite source) Changes in environment RELEVANCE TO ENTERPRISE (Elaborate on why or how is the factor relevant to the firm)
Explain reasons for conclusions. Support quantitatively. Indicate presence or absence of the following factors that tend to increase intensity. Discuss. Support quantitatively. Increasing number of competitors. Competitors becoming more equal in size Competitors becoming more equal in capability. Industry demand declining. Price-cutting becoming common. Consumers can switch brands easily. Barriers to leaving the market/industry are high. Fixed costs are high. Products are perishable. Rival firms are diverse in strategies, origin and culture. Mergers and acquisitions are common. Cite and discuss other factors that apply to your competitive milieu that point to the degree of intensity of rivalry among firms in your industry.
Explain reasons for conclusions. Support quantitatively. Indicate presence or absence of the following factors that increase barriers to entry and discourage new competitors. Discuss. Support quantitatively. Need to gain economies of scale quickly. Need to gain technology and specialized know-how Lack of experience Strong customer loyalty Strong brand preferences Large capital requirements Lack of adequate distribution channels Government regulatory policies Tariffs Lack of access to raw materials Possession of patents Undesirable locations
Counterattack by entrenched firms Potential saturation of the market Current product offerings of very high quality. Difficult to improve on. Prices are low. Lower prices would mean unattractive margins. Current competitors have strong marketing resources. Other factors youve identified/appropriate to your industr\.
Explain reasons for conclusions. Support quantitatively. Discuss: If there are few or many suppliers. If there are only a few good substitute materials. If the cost of switching raw materials is especially costly. If backward integration is a commonly used strategy among rival firms in your industry.
Explain reasons for conclusions. Support quantitatively Indicate presence or absence of the following factors that increase consumer/customer bargaining power Discuss. Support quantitatively. Customers are concentrated or large Customers buy in volume Products are undifferentiated.
Explain reasons for conclusions. Support quantitatively. Discuss competitive pressures from substitute products: Their market shares Their marketing aggressiveness Their capacity expansion plans