Swot analysis and Porter's five forces analysis have been selected as practical tools for global market strategy. These tools are helpful in multiple ways. Swot analysis is the best tool because it can help to leverage the strengths at the worldwide level. Good brand image, reputation, and advanced technology will be recognized globally. Identifying weaknesses is an integral consideration through Swot to set the foundation for better mitigation when operating at the global level. Global operations require a deep understanding of loopholes or weaknesses to sustain the business with its true essence. Swot is effective because it facilitates the organization in recognizing the opportunities at the global level. Identification of these opportunities can assist in shaping an effective global strategy (Kunc, 2018).
Apart from that, when operating at the worldwide level, it is essential to recognize and evaluate possible challenges or threats to set the foundation for incredible resilience. Porter's five forces analysis is also still effective for global business strategy. For instance, buyer and supplier power must be navigated globally to comprehend the industry dynamics. The firm may face a different level of competition compared to its home country. Thus, the tool seems relevant as far as the better assessment of the intense rivalry is concerned. Steering the threat of new arrivals and substitutes is also relevant through this tool. Based on this assessment, the organization can shape the global strategy and set the ground for competitive advantage. Hence, both strategic tools are practical and relevant in the context of the worldwide strategy (McPhail & McPhail, 2020).
Evidence to Support Decision
One of the best ways to decide threats and opportunities in the industry is to apply Porter's five forces analysis. Corporations, including small and large entities, have used this analysis to examine the industry's competitiveness. According to Dixon et al. (2021), companies have considered these forces on a low, medium, and large scale for each component, and this understanding of industry competitiveness can facilitate maximizing profitability in multiple ways. Epic Escape Room is the perfect example, as it can navigate these elements to have an excellent competitive rivalry. The critical assumption is that the organization must use practical resources to create unique customer value. It is all about beating the existing competition (Dixon, Tompson, Papp, & Hall, 2021). Swot, on the other hand, has been an effective and relevant tool, especially in the context of internal or global business strategy. Vlados (2019) argued that it assists organizations in assessing internal and external business climate.
However, the critical assumption is that the Swot must be correlative and evolutionary in the modern and dynamic business era. There is a need to recognize specific strengths, weaknesses, opportunities, and threats to open ways for positive changes. The new application of this strategic tool always opens ways or paths for comparative strengths that can further assist in transforming potential opportunities into accurate and specific strategic options. Similarly, this modern application opens ways for the recognition of relative weaknesses, which can further transform potential threats into real-time challenges in the competitive and dynamic business climate (Vlados, 2019).
Refuting the People Who Chose an Additional Tool
First, there is a need to acknowledge that there are also other practical strategic management tools that can be applied for multiple purposes. Recognizing the diversity of values is essential. However, refuting people and becoming certain is also the right approach, and it is possible by highlighting the strengths of the preferred tools. It is all about streamlining the strengths of the tools, as these are widely recognized and applied. Also, there may be a brief discussion about the application or adaptability of these tools in the context of the global business strategy. The strategic consultant can explain how these tools can capture multiple aspects of the internal and external business climate.
For example, geopolitical considerations, cultural variations, and regional differences are eventually critical in this regard. The best way to refute the additional tools is to present the evidence and real-time case studies. Corporations have used these tools to better assess or evaluate their climate at the global level, which led to success and competitive advantage (Pušnik, Šumak, & Štumpfl, 2020).
Brief Analysis of Market
Swot Analysis
Strengths: The firm has a good brand image, and it will help to explore the fashion or clothing market at the global level. Financial state is also a good strength that will help to grow and expand globally. The firm has an adequate product portfolio, which is based on the local source fabric. It becomes a strength as far as the localization and unique customer value are concerned. Advantages such as technology and operational efficiency are also key strengths that will be relevant globally.
Weaknesses: The firm depends on the trends in the clothing industry. Of course, it usually makes the current product portfolio irrelevant. Seasonality is also a weakness, as a probable shift in the product portfolio is always apparent, adding additional costs to operations. There have been some supply chain disruptions when it comes to sourcing fabrics. This supply chain disruption is one of the significant weaknesses (Kunc, 2018).
Opportunities: Global expansion is one of the most significant opportunities, as the firm can identify the potential markets to acquire new customers. Strategic alliances and partnerships are also obvious or probable to share people, processes, and technologies to enhance operational scalability (Dringoli, 2016). Integration with advanced technology, including e-commerce, is an excellent strategic option.
Threats: Shift in regulations is a significant weakness, especially when it comes to sourcing and consuming fabric domestically. Effective compliance is needed to be legally and ethically relevant. Economic downturns are leading to a massive sales decline. It is a threat that can be evaded by utilizing strengths and opportunities (Vlados, 2019).
Five Forces Analysis
Power of Buyers: It is a strong (high) force as customers typically have many options in the clothing industry. People strive for high quality along with the price and cost consciousness, making the bargaining power high.
Power of Suppliers: It is also an intense (high) force. The firm has been specific with its suppliers to retain its quality, making the bargaining higher. However, a multi-supplier strategy at the global level is needed to evade this issue.
Threat of Substitutes: it is an intense (high) force. People have options in the market when it comes to clothing and fashion.
Threat of New Entrants: It is a weak (low) force because new companies may need substantial investments to operate at the global level. Current companies have created barriers in the form of high brand image and customer acquisition. It is easier to beat the existing rivals with differentiation and unique customer value (Dixon, Tompson, Papp, & Hall, 2021).
Competitive Rivalry: It is a strong (high) force because many local and global rivals operate in the industry. The blend of integrated cost leadership and differentiation can be the best business-level strategy to beat the competition internationally.
References
Dixon, D., Tompson, G. H., Papp, R., & Hall, A. R. (2021). The Epic Escape Room: Choosing the Best Option for Growth. Small Business Institute Journal, 17(1), 1-11. doi:https://doi.org/10.53703/001c.28163
Dringoli, A. (2016). Merger and Acquisition Strategies: How to Create Value. Edward Elgar Publishing.
Kunc, M. (2018). Strategic Analytics: Integrating Management Science and Strategy. John Wiley & Sons.
McPhail, I. P., & McPhail, C. J. (2020). Strategic Planning as a Leadership Development Tool for Midlevel Leaders. New Directions for Community Colleges, 191(1), 21-33. doi: https://doi.org/10.1002/cc.2040
Pušnik, M., Šumak, B., & Štumpfl, U. (2020). Analysis Of Strategic Planning Assistance Tools. Central European Conference on Information and Intelligent Systems, 289-294. doi:https://coloradotech.idm.oclc.org/login?url=https://www.proquest.com/conference-papers-proceedings/analysis-strategic-planning-assistance-tools/docview/2531373666/se-2?accountid=144789
Vlados, C. (2019). On a correlative and evolutionary SWOT analysis. Journal of Strategy and Management, 12(3), 347-363. doi:https://doi.org/10.1108/JSMA-02-2019-0026
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