Electrocomponents Plc

Topics: Computer-aided design, RS Components, Electronic design automation Pages: 5 (1205 words) Published: April 6, 2013
Business Environment

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An analysis of Electrocomponent plc’s business environment

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World Count:1000

Date:16th January 2012

Electrocomponents plc
Electrocomponents plc is a high service distributor of electronics and maintenance products. It has two brands – RS Components and Allied Electronics. It operates in 32 countries and another 37 through dustributors. It is a European technology hardware and equipment sector. They offer customers an easy way to find, design, and purchase the right electronic components for their application. Electrocomponents plc has been implementing a major reorganization since July, 2012. The main driving force for this behind the strategy is globalization. The target customers of Electrocomponents plc are Electronic Design Engineers, Machine and Panel Builders, and Maintenance Engineers around the globe.

Main products and services

DesignSpark is one of the software that Electrocomponents plc provide to electronics engineers. It offers free, reliable technical information, resources, and user generated reviews to assist their electronics design. RS Components and Allied Electronics are trading brands of Electrocomponents plc. They provide customers a quick and easy way to shop online. Both brands guarantee that the order will dispatch on the same day where the order is made on their website. RS Components also provides 3D CAD Models to download free of charge to aid customers on integrating their projects. Electrocomponents plc offers electrical, automation and control (A&C), test and measurement, and tools, safety and consumable products. They are one of the main suppliers for small and medium enterprises (SME) machine and panel builders, on – site maintenance engineers and buyers.

Socio-cultural and Demographic factors

* Incereased shipping across the globe.
International seaborne trade from 1980 to 2011 (millions of tons loaded)

Following the implementation of global operating model, Electrocomponents plc is expecting to increase in operating efficiency, lead to lower the operating cost, and increase in profit. Also, weakening in Euros will increase currency movements on the company and it will lead to a decline of profit in Europe. Economic factors

* Inflation  provoke higher wage demands from employees and raise costs. The inflation in UK is high (at 2.7% in November 2012 referenced from ONS referenced below) and will remain high with the upcoming rises in transport fares, food prices due to bad weather in summer, and energy price. Electrocomponents plc may result in an increase in operating costs. It may affect employee’s behaviour if pay is lower than inflation.

* Weak currency makes exporting more easier as goods are less expensive for foreign customers. Pound Sterling is depreciating and will lead to a higher sells in foreign country for Electrocomponents plc.

* Technological factors

Higher interest rates deter the company’s investments.

* Video games. The rapid development of Electronic Sports (eSports) globally over the last decade has lead to a larger demand for electronic hardware such as computer, console and other gaming accessories. The following data showed that the market share of video gaming industry has rapidly increased over the last decade. Market size of video gaming industry from 2003 to 2013.

* High definition TVs. Given its ability to sharpen images captured during surgery, HD technology revolutionized the visualization device market. Increasing demand of HD hardware is needed to satisfy customers across the globe.

* Online shopping. With the constant improvement of the development of computer network technology and infrastructure construction, the convenience brought by the network encouraged customers to shop online. This enables customers to shop anytime, anywhere, to view the full seller’s portfolio as long as...

Bibliography: Electrocomponents plc Corporate Governance report, 2012. Electrocomponents plc, referenced from:
Kew, J. & Stredwick, J., 2008. Business Environment: managing in a strategic context, CIPD Publishing.
Palmer, A. & Hartley, B., 2008. The Business Environment, McGraw-Hill.
Brautaset C. & Tenold, S., 2008. Globalisation and Norwegian shipping policy, 1850-2000.
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