Analysis from a value chain perspective (upstream and downstream)

forward integration strategy

backward integration strategy

Applicable situations (SWOT analysis ideas)

Analysis from the value chain perspective (same direction of the value chain)

Purpose: To pursue economies of scale to gain competitive advantage

Applicable situations (SWOT analysis ideas)

Emphasize the development of a single product and increase the market share of existing products through various marketing methods or greater marketing efforts

Applicable situations

The cost structure of the leading firm in a mature market prevents competitors with a small market share from entering the market

A strategy to enter new markets with existing products or services, or to open up other regional markets or market segments.

Applicable situations

A strategy to expand sales in an existing market by improving existing products or developing entirely new products

Applicable conditions

New product marketing success comes from predicting the market, not just reacting to consumer changes

Related diversification strategies

unrelated diversification strategy

Continuing operations in existing products or markets cannot achieve corporate goals

Financially balance cash flow

A diversification strategy means higher profits than expanding in existing areas

between individuals

individual

Inter-individual: Internal business integration risk

individual

Overall: overall market risk

The need for corporate strategic reorganization

External environmental reasons

Internal environmental reasons

Throttle

specific methods

Open source

specific methods

Improve first, otherwise give up

Including: franchising, subcontracting, sell-out, management leveraged buyout, splitting assets into shares\spin-off

Degree of specificity of fixed assets

Exit costs (labor agreements, relocation costs, etc.)

Internal strategic linkages (correlation barriers, vertical integration, financial market confidence)

emotional disorder

Government and Social Constraints

Similar to integrated strategy: forward, backward, horizontal, diversified

Friendly mergers and acquisitions

hostile takeover

Industrial capital mergers and acquisitions

Financial capital mergers and acquisitions

LBO

non-leveraged buyout

(Analysis from internal marketing R&D, management, financial perspective, external situation perspective)

(Analysis from industry level and individual level)

Form: joint venture, mutual shareholding investment

Advantages: It is helpful to expand the financial strength of the enterprise, enhance the sense of trust and responsibility of both parties, and is conducive to long-term cooperation.

Disadvantages: poor flexibility

Form: Functional agreement: technical exchange agreement, production and marketing agreement, etc.

advantage

shortcoming

Price: The product has great price elasticity, and there are a large number of price-sensitive users in the market

Products: Products in the industry are basically standardized or homogeneous, and there are few ways to achieve product differentiation.

Consumer: Buyers pay little attention to brands and most buyers use products in the same way

Competition: Price competition is the main means of market competition, and consumers’ switching costs are low

Industry characteristics

factors of production

production process

Sales

Management

Technological changes reduce the utilization or effectiveness of enterprise resources

Market demand shifts from focusing on price to focusing on product brand image

New entrants or followers in the industry may catch up by imitating or investing in higher-tech facilities.

Product: The product can be fully differentiated and recognized by customers

Consumers: Customers’ needs are diverse and differentiated

Competition: Industrial technology changes rapidly, and innovation becomes the focus of competition.

R&D perspective

Sales

Management

Strategic Decision

The cost of differentiation is too high

Market demand changes

Competitors may imitate or attack, causing differences to disappear

Differences in needs among buyer groups

The target market is relatively attractive in terms of market capacity, growth rate, profitability, competition intensity, etc.

Competitors in the target market have not yet adopted similar strategies

Enterprise resources and capabilities are limited, making it difficult to achieve cost leadership or differentiation in the entire industry, and can only select individual market segments.

Risks caused by narrow markets

The difference in demand among buying groups becomes smaller

Entry and competition of competitors

Low barriers to entry or high barriers to exit

Diverse market demands lead to high product differentiation

There are no economies of scale or it is difficult to achieve economies of scale

Government policies and other restrictions on the concentration of certain industries

No company has a significant market share and cannot have a significant impact on industry development.

Franchise or franchise

Technological innovation may create economies of scale

Discover industry trends early

Increase product added value and enhance consumers’ recognition of product value

Specialization in product type or product segment (may limit development of scale)

Customer Type Specialization

Geographic area specialization

technological uncertainty

strategic uncertainty

Rapid changes in costs

There are many budding companies and newly established companies

Customers are mostly first-time buyers

Difficulties in selecting, acquiring and applying proprietary technology

Insufficient supplies of raw materials, parts, funds and other supplies

Customer confusion and wait-and-see

Lack of courage and ability to take risks

Reactions to substituted products

Corporate image and reputation are important to customers

The industrial learning curve is very important, and experience is difficult to imitate.

Customer loyalty is very high

Through early commitment to raw materials and sales channels, absolute cost advantages can be obtained

First entrants have high switching costs

Those who enter first become martyrs, and those who come later sit back and enjoy the success.

Latecomers take the lead and overtake in corners

High price, high value, low price, low value

Achieve low cost and high value simultaneously

Developed countries -> similar developed countries -> developing countries

Developing countries -> Similar developing countries -> Developed countries

Developed/Developing Countries->Developed Countries->Developing Countries

fully control

Get out of conflict

More phone bills

lack of supporters

Reduce capital investment in international operations

Less political risks, making up for the lack of experience in cross-border operations

With multiple parties involved in investment, coordination costs may be too high

Provide supporting services to leading companies, often participate in multiple global value chains, and have low dependence on leading companies

Leading Enterprises-->Foreign Direct Investment-->Suppliers

Applicable conditions: complex products, low supplier capabilities

Relationship with suppliers: similar to headquarters, with full control over suppliers

Leading Enterprises-->Market Transactions-->Suppliers

Applicable conditions: The product is simple, and the leading company has the ability to obtain services from other companies or serve other companies.

Relationship with suppliers: simple market transactions, trade relations

non-equity form

Leading Enterprises-->Clear Instructions-->Suppliers

Applicable conditions: The product is complex and you want to reduce the transaction complexity that is unavoidable under the internal division of labor model.

Relationship with suppliers: Suppliers are very dependent on leading companies and their production activities are usually limited to a narrow scope

non-equity form

Leading companies <--> jointly develop standard modules <--> suppliers

Applicable conditions: The product has modular characteristics and can be standardized

Relationship with suppliers: Information flow between enterprises is much higher than normal market transactions, and coordination costs are low

non-equity form

Leading Companies <-->Interdependence<-->Suppliers

Applicable conditions: product specifications are difficult to code, transactions are complex and suppliers have strong capabilities

Supplier relationships: Competitive suppliers can provide leading companies with competitive ancillary functions

Low degree of global collaboration and low adaptability to the local market of the host country

The company's special competitiveness gives it a competitive advantage in foreign markets and there is less pressure to reduce costs in that market

Transfer core competencies

The local area has its own needs and cannot be met in a targeted manner; the cost of repeated construction in various places is high

Low degree of global collaboration and high adaptability to the local market of the host country

There is strong demand from local markets to provide products and services based on local needs and reduce costs

Strong regional adaptability

The cost of duplication of production facilities is high, and excessive localization makes each country's subsidiaries too independent.

High degree of global collaboration and low adaptability to the local market of the host country

Situations where cost pressure is high and local franchise requirements are small

Obtain location economies, experience curve effects and economies of scale effects

This strategy does not work in markets that require local specialty products

High degree of global collaboration and high adaptability to the local market of the host country

Situations where there is high pressure to reduce costs and pressure to resist differences in estimates

Obtain location economy, experience curve effect and scale economy effect; have strong regional adaptability; form a global learning effect

In practice, it is difficult to determine the balance point between regional adaptability and global efficiency needs.

There is little pressure from globalization, and the resource advantages we have are only suitable for the domestic market.

Leverage the strengths of the domestic market for defense

Lock in customers; adjust products; build channels

There is little pressure from globalization, and the advantageous resources we have can be transplanted overseas.

Transfer corporate experience to surrounding markets

Make rational use of superior resources, use the local market as a platform, and expand to other markets

The pressure of globalization is great, and the resource advantages we have are only suitable for the domestic market.

Move to new businesses or niche markets to avoid competition

Joint ventures and cooperation with competitors

sell

Redefine your core business and avoid direct competition

Focus on market segments based on their own strengths

Produce complementary products

The pressure of globalization is great, and the advantageous resources we have can be transplanted overseas.

Attack through global competition

Find a benchmark

Find a market

Looking for a breakthrough

obtain resources

Geographic segmentation

population segmentation

psychographic segmentation

behavioral segmentation

distinguish

User's industry category

User scale

User's geographical location

buying behavior factors

A single strategy for the entire market

Strive to meet the needs of as many customers as possible to a certain extent

Targeting multiple sub-markets and different strategies

Targetedly meet the different needs of various markets

Target one or a few submarkets with similar nature

Trying to capture a larger market share in fewer submarkets

market similarity

product homogeneity

Enterprise strength

Product life cycle stages

competitor strategy

Product portfolio width, length, depth and relevance

Product mix strategy types

single brand name

Multi-brand strategy

Private brand strategy

Reasons for product development

advertising promotion

Business promotion

public relations

personal selling

push strategy

pull strategy

push-pull strategy

direct distribution

indirect distribution

exclusive distribution

selective distribution

intensive distribution

online channels

Offline channels

cost oriented pricing

demand-based pricing

competitive price pricing

psychological pricing strategies

Product portfolio pricing strategy

Discounts and discount strategies

Geographical Spread Strategy

penetration pricing

skimming pricing

Satisfied with pricing strategy

Insufficient communication between supply and demand parties

Only supply and demand relationship, lack of other cooperation

For the purpose of replenishing inventory, lack of attention to the market may result in overstock or shortage

Management is simple and extensive, and procurement costs remain high

Detailed production and purchasing planning

The calculation and preparation of procurement plans are complicated

Few suppliers, even a single supplier

Long-term and stable cooperative relationship

Small purchase quantities and high delivery frequency

Each other cares about each other's product improvement and innovation, actively coordinates and cooperates, and shares information quickly and reliably.

Long-term and stable cooperative relationship

Breaking the siled procurement and inventory management model, sharing information and greatly saving costs

According to the principle of sharing interests and risks, negotiate and formulate relevant management fees, etc., to establish a solid foundation for cooperation between both parties.

Automatic identification, mutual understanding, and direct transactions based on digital platforms

Eliminate a large number of manual operations, innovate and optimize the procurement process and even the entire business process of the enterprise

Procurement management has become more scientific, convenient, sophisticated and accurate than ever; it adapts to the development trend of new technologies

成本领先

差异化

集中化

成本领先

差异化

集中化

Create value

diminished value

cash surplus

cash shortage