Competitive Analysis of Metro Holdings Ltd Essay -- Business Analysis

1.Introduction subway system Holdings Ltd is a multi-national company that operates two major business segments, namely Property Development and Investment, and Retail. This composing explores the retail arm of Metro, which manages three department stores and four specialty accessorize stores in Singapore, and another five department stores in Jakarta and Bandung, Indonesia.2.Competitive Environment of Metro LtdThe competitive environment of Metro Holdings Ltd would be evaluated based on Michael Porters 5 forces Model. The factors affecting each force would be critically analysed to forge the competition faced by the business. As the nature of department stores and specialty accessorize stores is vastly different, the report would focus on the analysis of department stores which accounts for a large portion of the companys income and presence in the industry.2.1Threat of New EntrantsThe threat of new entrants is relatively low in the department stores industry.Department stores do not manufacture products nor create their own brands of merchandise, their products are not differentiated. As a result, consumers have low switching costs, customer loyalty is low, as they potful easily purchase similar products elsewhere. These lower the barriers to entry, allowing new entrants a chance to gain customers. On the other hand, most factors prove otherwise. The retail industry does not have high Economies of Scale to be exploited in general . Yet, it is impossible to run department stores like Metro on a slender scale . A large retail space, inventory, and warehouse are necessary to host a specialized portfolio of brands and products to better attract both customers and suppliers. Heavy dandy requirements and operational expen... ...Michael Porters Five-Force Model. Able to make valid and clear conclusions about the competition faced by the business, based on the analysis.Demonstrate a clear understanding of the business and the actual environment it operates in. Works Cited https//www.metro.com.sg/storefront/ContentDetail/AboutUs3.asp?ContentId=458 http//digilander.libero.it/fschivardi/images/schivardiviviano.pdf Charles A. Ingene, Scale Economies in American Retailing A Cross-Industry Comparison Engle, J., How to Open & live on a Financially Successful Retail Business http//secure-online-purchasing.suite101.com/article.cfm/the_growth_of_internet_shopping http//www.streetdirectory.com/travel_guide/singapore/expat_guide/910/singapore_aims_to_achieve_65mil_populati on.php Eng, P., Accounting for Indonesias economic growthRecent past and near future