PROGRAM:BUSINESS & ITS ENVIRONMENT
TUTOR:MR. J KUHUDZAYI
DUE: 18 OCTOBER 2010
OK Zimbabwe Limited’s business is general retailing, providing quality merchandise and service offering value for money to its customers in all market segments in Zimbabwe and selected countries in the region. To achieve its objectives OK focuses on its human resources, selling and management of costs in the hostile environment in which it is operating. There are many factors that affect the company’s business and the results of its operations, some which are beyond its control. The following is a description of some of the important factors that threaten the actual results of the company’s operations in the future. Strategy toolkit (www.mindtools.com) defined a threat as something affect the business but is not within the company’s range of control. The threats confronting OK exist or develop in the following areas: 1.COMPETITION
This is the major threat that the company is facing apparently. Competition has been defined by wikipedia (www.wikipedia.org/wiki/Competition ) as a contest between individuals, groups, nations, animals, etc. for territory, a niche, or a location of resources. The basic resource being fought for by the companies in the retail industry is the $150 that an average working Zimbabwean is earning every 30 days. The Zimbabwean retail market has been characterized by very low market entrance barriers hence the influx of so many convenient shops located at every corner of every town in Zimbabwe. Implications on OK Zimbabwe Ltd
The threat of competition affects OK Zimbabwe in the sense that its market share will be diluted by the entrance of the new players hence a subsequent decrease in profit margins (how?). The margins are reduced by the tendency of companies trying to out do each other by lowering prices hence the reduction in profit margins.
Overcoming the Competition
Knowledge of the...