Management Assignment

Topics: Management, Foreign exchange market, Factor analysis Pages: 8 (2325 words) Published: November 18, 2012
1. Introduction
1.1) About Herbalife
1.2) Mission of Herbalife
1.3) Herbalife Way
1. Macro Environmental Factors
2.4) Political/Legal Forces
2.5) Economic Condition
2.6) Social/Cultural Environment
2.7) Technology Changes
2. Micro Environmental Factors
3.8) Customer
3.9) Intensity of rivalry among competitor
3. Four Management Functions that affects the economy
4.10) Planning
4.11) Organizing
4.12) Leading
4.13) Controlling
4. Conclusion
5. Recommendation

1. Introduction
1.1) About Herbalife
Herbalife is a global nutrition, weight management and skin care company. It runs the business in 84 countries (As July 2011) and distributes the products by approx. 2.7 million independent distributors. Herbalife recorded 5.4 billion USD in retail sales in 2011 that surpassing Mark Hughes’s (founder of Herbalife) vision of 5 billion USD. This company was founded by Mark Hughes in July 1980. (cited from Herbalife History)

1.2) Mission of Herbalife
To change people’s lifestyles by providing the best business opportunity in direct selling and the best nutrition and weight-management products in the world. (cited from Herbalife Mission)

1.3) Herbalife Way
Herbalife penetrates the market by sponsoring world-class athletes, teams, events around the global such as Lionel Messi, FC Barcelona soccer clubs, 2011 World Football Challenge and champions in more than 15 other sports. (Cited from Herbalife Sponsorship) Herbalife adopted multi-level marketing to distribute their products from independent distributors.

2. Macro Environmental Factors
There are many environmental factors that affect the business. Among these factors, we can categorize into two segment- internal and external factors or micro and macro environmental factors. In external or macro environmental factors, following are contains: political/legal forces of the Government, social/cultural environment, economic condition and the technology changes. From the above factors, I want to discuss 4 factors. 2.1) Political/Legal Forces

Political forces are a kind of laws and regulation. This is the level of the government what and how intervenes in the economy. For example, tax policy, tariffs, environmental law, trade restrictions, labor law and what goods and services are provided by the government and what are not and so on. And then the infrastructure of the business and how affect to the health of nation. Laws and regulations are always changing and complex in the economy. For Herbalife, some products cannot import to Singapore because of the law. In this condition, Herbalife should try to discover in another way to export to Singapore that accept from the Singapore Government such produce the product in different way or scrutiny the way of production to get the same effect.

2.2) Economic condition
Economic condition can affect to the company. Economic condition contains economic growth, interest rates, exchange rates, inflation rates and taxation rates. The noticeable thing is exchange rates. For Herbalife, it is base in US and run the business in above 80 countries. So, Herbalife always deal with exchange rate. Normally, exchange rates are always fluctuating. All countries are also using their own currency. When local currencies devalue in exchange market, this will be a problem. As the prices of the products are fix, the profit will be reduced than original expect. 2.3) Social/Cultural Environment

It is the social aspect or cultural aspect such as health awareness, population growth rates, education, trends, lifestyle changes, attitudes to work, safety, age distribution, leisure activities, career attitude and so on. For example in Singapore, most of senior people willing to work and earn money. Most of companies and organization desire to recruit young and active people. Herbalife reduce this...
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