I. Introduction UMUC Haircuts has been the only barber/stylist in the local area. The hair salon business is expanding over the local area and this report is to provide areas of improvement using the Five Forces Analysis. Once the improvement areas are defined then UMUC Haircuts can make the necessary changes needed in order to remain competitive within the hair salon industry.
II. Five Forces Analysis
FORCE EXPLANATION
(Minimum 2 good sentences) IMPACT (POSITIVE, NEGATIVE, or NEUTRAL) AFFECT STRATEGY? (YES/NO)
BUYER POWER The buying power of a company will rely on the amount of suppliers for a specific product. Once there are few buyers and multiple sellers the cost will be low and the buying power will be high. UMUC Haircuts is a small company that depends on local purchase of the supplies needs so UMUC Haircuts has little buying power due to the amount of product sold isn’t directly affect the supplier’s product profit. Neutral Yes
SUPPLIER POWER The amount of stress a supplier is able to put on a buyer. This form of stress comes in the structure of raising prices, reducing quantity of quality of a product. The suppliers for the product that UMUC Haircuts need to maintain power over the cost of the products and UMUC Haircuts has minor to no direct effect on the suppliers pricing strategies. Negative Yes
THREAT OF SUBSTITUTE …show more content…
In order for UMUC Haircuts to have an advantage over the competition, they need to upgrade employee and customer scheduling and design a more efficient way to manage inventory and ordering supplies. The strategies listed above are justifiable using the Five Forces Analysis. Myra could reduce her threats of substitute products by providing services that can’t be purchased from a
II. Five Forces Analysis
FORCE EXPLANATION
(Minimum 2 good sentences) IMPACT (POSITIVE, NEGATIVE, or NEUTRAL) AFFECT STRATEGY? (YES/NO)
BUYER POWER The buying power of a company will rely on the amount of suppliers for a specific product. Once there are few buyers and multiple sellers the cost will be low and the buying power will be high. UMUC Haircuts is a small company that depends on local purchase of the supplies needs so UMUC Haircuts has little buying power due to the amount of product sold isn’t directly affect the supplier’s product profit. Neutral Yes
SUPPLIER POWER The amount of stress a supplier is able to put on a buyer. This form of stress comes in the structure of raising prices, reducing quantity of quality of a product. The suppliers for the product that UMUC Haircuts need to maintain power over the cost of the products and UMUC Haircuts has minor to no direct effect on the suppliers pricing strategies. Negative Yes
THREAT OF SUBSTITUTE …show more content…
In order for UMUC Haircuts to have an advantage over the competition, they need to upgrade employee and customer scheduling and design a more efficient way to manage inventory and ordering supplies. The strategies listed above are justifiable using the Five Forces Analysis. Myra could reduce her threats of substitute products by providing services that can’t be purchased from a