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HI5019 | Strategic Information System of Bunning Local Company

Answer:

Introduction

Bunnings Group is one of the trading company with the international household hardware chain. It is one of the local companies which was founded in 1887 in Perth, Western Australia which included the expansion into the retail sector and then purchasing the products from different hardware stores. The company began to expand into the other states as well and comprise of 294 stores with over more than 30,000 employees. The market share of it is 20% in Australian retail hardware sector with competing chains that include Home Timber & Hardware with other independent retailers. The company has ben able to work and reach the people by providing the gardening, craft and other woodwork workshops for the children in store, in schools or in hospital.

Part 1:

External Analysis


The analysis is based on the Australian leading hardware store which is set in terms of marketing and the research is for the qualitative research based on secondary source of information. It helps in marketing and easily focusing on credible and academic sources to understand about the marketing strategies.

Business Background

The company tends to extend the pillar of service which is not only for aiding the clients to make decisions for shopping in the stores but also to make it easy to drop by the stores Woolworths has 8% stake for the Australian marketing share which makes use of the subsidiaries like Home Hardware and Timber, and Masters Home Improvement (Campbell, 2017). It has 7.3% market share and use True Value Hardware and MITRE. Australia largest and profitable home improvement retailers are set with 9 lakhs customers who are shopping at Bunning with over the period of 4 weeks in July 2014.

What Industry Is It?

Bunning is the household hardware company which is financially a secured company with the growing revenue. The company has been working on handling the largest hardware chain with 195 warehouse that is set with comprehensive hardware range and 42 Bunnings local limited range stores (Ang et al., 2018). The generated amount of share is 49% and 17% market share of Home Improvement with Outdoor Living sector.

Environmental Analysis 

Economic: The change in consumer or customer trends in the present situation has depicted a higher value to consumer wants. Consumers have highly proclaimed their part in disposing the income to the industry. In the concerned case, the private labeled organisations have shown its contributions in structuring the maximum efforts to the overall business growth showing the capability to gain the consumer attention.

Physical & Legal: Bunnings is responsible to Product Safety Australia (PSA) for handling the household home appliances and other hardware industry which is mainly given by Australian Competition and Consumer Commission. (ACCC) The laws have significantly valued the overall operations of the retail business (Turner, Kushniruk & Nohr, 2017). The companies have concentrated on the various policies that are to undertake all the necessary initiatives reflecting the employment, empowerment and other specific business responsibilities.  The criteria have been structured to set up the governmental policies as in the present situation crusades has been developed to block the retail organisation by the side of Bunning.

Demographic: An organisation identifies the target market in understanding the demographic specification of the market in order to the sell the products or services to the market. As based on the Australian market, the consumer needs and demands have shown a drastic change.

Socio-Cultural Factors: The organisation is more prioritised towards the customer well-being and health. Moreover, Bunning have stocked the organic food products and materials as per the moving consumer nature to health-based food products. The current period has shown the potential threats for the Australian farmers as they are changing their operations to survive in this changing business environment (Akbar et al., 2014).

Political: It is functioning on the challenging market environment where the market has shown the full concentration on the business expansions and growth while focusing on innovative manufacturing and production.

Technological: In the present business process, the technological factors have shown considerable aspects that have standardised the business grew in significantly to its business operations. The factors help the organisation to gain the competitive advantage and edge (Campbell, 2017). Bunning’s managers have significantly installed green-refrigeration techniques within the organisational structure that supports the fact to implement technological advancements in its business process.

Industry Environment 

Substitution of rivalry: The rising small organisations have shown more potential rivalry to the organisation like Bunning in the Australian Market. In respect to other aspects that show that the organisation offers, various requirements that are based upon the product and service nature considered in the market. The hardware industry has prioritised three major key areas that are to locate the stores efficiently in the market, considering a consumer valued product price and understanding the market or consumer requirements and choices. Costco and Coles are the rivalries of Bunning present in the current Australian market (Roberson, 2014).

Substitution threats: In recognising the Australian market, the threat represents the menace to be substituted in the market. High or increased changes in this organisation have led the companies to face several threats or challenges from the special and convenient grocery stores.  

Suppliers Bargaining Power: The bargaining power of the business (raw materials) suppliers have also shown the lowering of the bargaining approaches, as the companies are being dependent upon more than one local suppliers (Clardy, 2014). Moreover, business giants like Bunning and Coles have controlled over 81% of the market share in this retail industry.

Buyers Bargaining Power: It is ensured that the increase of aggressive sales requirements is required to be developed by the federal Government and ACCC in order to refer the purchasing pattern of the company. Australian Market and its bargaining power of the purchasers are lowered because of the extreme availability of the consumer-based products in the market.

The threat from New Entrants:  The increased intensity of this threat has lowered the chances of sustained business future for the organisation. The organisation has to incorporate frequent innovative changes and operations in the technological, manufacturing and in its distributional channels.

Competitive Environment

In understanding the current market situation, Masters company have created various teething troubles for Bunning in concern to retain the consumers for its organisation. There have been issues with focusing on sustainability and advancement in the Timber industry as well (Meath et al., 2016). The promotional approaches have been effectively handled with social media and networking sites to secure the task. Bunning has also promoted the organisation through efficient sponsorships and advertisement. The probable threats are evident to avail the augmented results timber industry. (Campbell, 2017)

Opportunities & Threats

The opportunities are that it can offer certain online purchasing platform for more people who want to build their outdoor hangout places in homes. With this, there has been a growth of the different country home owners as well. The threats and the opportunities of Bunning have shown the ability that the company has shown appropriate approaches to overcoming the threats and have utilised the market opportunities effectively in strengthening the organisational functions. The biggest opportunity for Bunning was to function in the technological innovations and advancements utilisation. Such innovative approaches have allowed the company to emphasise free trade agreements and have allowed it to enhance the overall business functions.

The biggest threat identified by Bunning are the irregular supply chains and increased process of the raw materials (Rastogi et al., 2016). Apart from this, the competition from the similar hardware retailers in the country where there has been a growth in companies lead to the contractual maintenance of jobs. It leads to reducing the hardware purchase mainly among the different users at a domestic level. The global economic standards might lead the people to invest on houses and the other hardware industry.

Part 2 

Internal analysis and proposal

To conduct an appropriate internal analysis will allow the organisation (Bunning) to understand its capabilities and will allow the company to ensure the factors contributing to strengthen the business forms and to resolve the weaknesses of the organisation. Bunning is one of the financially secured company which has a growing revenue with strong and trust brand limits with wider range of product offerings. It mainly focuses on the community and the proper reputation for better services of customer.

Tangible and Intangible Resources of the firm 

Bunning has shown a decent amount of intangible and tangible resources referring to appropriate human resource and innovation approaches to implementing products in the organisation. It has shown more than 3000 stores working all over the Australian market and in New Zealand. The biggest advantage identified was that the company has compromised the product quality and have ensured a better quality of services (Campbell, 2017). Bunning has significantly shifted its focus to consumer-preferred products while supporting the vital stakeholders belonging to the company management. The tangible resources are listed to show about how Bunning is able to work on setting the strong assets in the different areas. Bunning brand has been strongly embedded with the home and the hardware industry where the development of the intangible resources are for the competitors to imitate and then compete against as well.

Capabilities

Bunning has shown the ability to implement enhanced production techniques that are intending to introduce define innovation in the organisational structures. The high capability of talented workforce and performing recruitments have enhanced the organisational productivity hence manage the supply chain efficiently (Campbell, 2017). The company capabilities are based on the human resources where the exceptional staff retention rate and the recruitment at different stages are done efficiently. There is a unique training and development method with distribution that is done through freight delivery system that helps in creating an efficient delivery with the vast number of suppliers as well. The marketing standards are set with the implementation that helps in illustrating about the different levels of the business strategy with the target market segments.

Core Competency Analysis 

The company core competency is based on providing and delivering the customers with the lowest prices on the prices (Campbell, 2017). It is mainly achieved through better economies of scale that help in higher power of purchasing with the market competitors that allow the market to attain a better economy of scale (Atighechian et al, 2016). It includes the formation of the relationship and alliances with the suppliers with extensively handling the supply chain management and achieving the competitive pricing at Bunning store nationwide.

World class supply chain: It has been able to manage effectively through competitive advantage and having the supply chain management. The company is also able to focus on the efficiency and the cost cutting in management of the different expenses as well.

Branding and Market: The standards are set for the creation of differentiated range of the quality and the health product ranges at the reasonable price.

Innovation: The company is also able to work on the implementation of different projects which include the refreshing and the new ideal programs with retailing of petrol products as well.

Suitable Information System Solution

The use of Innovation standards with the Trade Intranet Internet store process has helped Bunning to growth with focus on handling the IBM Australia stored on the XIV storage system. This has been helpful to work with improvement in the capabilities of 54TB of the stores and the volume controller where the software programs are used with IBM XIV management tool. The RFID is another effective technology that can be helpful in the retail and the distribution centers to allow the item tags that can be recorded and scanned for improving the shelf replenishment and then reducing the store stock outs as well. This has also resulted in the reduced cost of labor and then preventing the loss of thefts with computerized quick access and the reliable data. Here, the focus is on the sustainability plans and opportunities that helps Bunning to work with the onsite water tanks to make use of the recyclable canvas bags and sources. The employees are being trained for the operations and then they are working on implementing the new PAR level products which are never out of stock. The global international suppliers work on handling the business operations in Australia and New Zealand that helps the company to aim and dominate on hardware industry in Australia. The providers of the specialist hardware are focusing on improving the brand with building the business growth through increased customer market and focusing on trades of people.  

Recommendations 

Bunning can work on improving their action plan through better sales growth where the company needs to handle their service levels, training and the development of categories. The stock levels and the inventory management needs to be handled where the actions are based on implementing the system where there is a need to implement the system throughout the company. The vertical diversification is through the acquisition of the construction and the business of landscape which helps in working with Jim Group Franchise. There needs to be a long-term planning for Bunning to evaluate the company with proper acquisition and then ensuring about the growth and sales effectively. The company has been able to achieve the strategy with implementing the plan through purchasing the business that operates in Australian sector. The horizontal diversification with acquisitions are set to do the business with Mitre 10 and Home Timber. The strategy is mainly to ensure that the companies are not major threat to Bunning. The involvement of community includes local school events and the charity events. Bunning is looking for the opportunities to get involved with local areas around store locations that are set worldwide.

Conclusion

Bunning has been one of the merging companies which is working on the financial and the efficiency that will help in handling the commercial customers with different methods for the payment(Campbell, 2017). The distribution of the products and then utilizing an expert for the distributed system, has helped Bunning to work on handling the outsourcing of delivery to ANC Courier and then handle the delivery of the products to the sites and the other retail centers. The customer responsiveness through social media and the trends with mobile phone are easy for the access and search ability with comparison on the prices or the product viewings as well (Sridhar et al., 2016). Bunning has been working on improving the quality standards with involvement in Academy of Sport, health and Education that provides the opportunities for the employees to store and work on the engaging aboriginal youths to work with Bunning employees.

References

Akbar, S. and Ahsan, K., 2014. Analysis of corporate social disclosure practices of Australian retail firms. International Journal of Managerial and Financial Accounting, 6(4), pp.375-396.

Ang, I., Rowe, D., Stevenson, D., Magee, L., Wong, A., Swist, T. and Pollio, A., 2018. Planning Cultural Creation and Production in Sydney: A Venue and Infrastructure Needs Analysis.

Atighechian, G., Maleki, M., Aryankhesal, A. and Jahangiri, K., 2016. Are Macro and Micro Environment Affecting Management of Fresh Water Resources? A Case from Iran with PESTLE Analysis. Materia socio-medica, 28(4), p.307.

Campbell, J., 2017. Insights from the company monitor: Wesfarmers. Equity, 31(8), p.16.

Clardy, A.B., 2014. Managing human resources: Exercises, experiments, and applications. Psychology Press.

Meath, C., Linnenluecke, M. and Griffiths, A., 2016. Barriers and motivators to the adoption of energy savings measures for small-and medium-sized enterprises (SMEs): the case of the ClimateSmart Business Cluster program. Journal of Cleaner Production, 112, pp.3597-3604.

Rastogi, N.I.T.A.N.K. and Trivedi, M.K., 2016. PESTLE technique–a tool to identify external risks in construction projects. International Research Journal of Engineering and Technology (IRJET), 3(1), pp.384-388.

Robertson, A.C., 2014. Commercial underground space-planned development for the future. In 15th Australasian Tunnelling Conference 2014: Underground Space-Solutions for the Future (p. 513). Engineers Australia and Australasian Institute of Mining and Metallurgy.

Sridhar, R., Sachithanandam, V., Mageswaran, T., Purvaja, R., Ramesh, R., Senthil Vel, A. and Thirunavukkarasu, E., 2016. A Political, Economic, Social, Technological, Legal and Environmental (PESTLE) approach for assessment of coastal zone management practice in India. International Review of Public Administration, 21(3), pp.216-232.

Turner, P., Kushniruk, A. and Nohr, C., 2017. Are we there yet. Human factors knowledge and health information technology—the challenges of implementation and impact. Yearbook of Medical Informatics, 26(1), pp.84-91.

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