Environmental Analysis Zhuoning YangIntroductionThe Harvey Norman Holdings Limited owns the main brand Harvey Norman, which is one of the largest retailers in Australia (Barrile, 2007). It is a franchiser and they are more than 230 retail stores in Australia, New Zealand and they also operate in Slovenia, Ireland, Northern Ireland, Malaysia, Croatia and Singapore (Harvey Norman, 2004). According to Harvey Norman’s annual report (2014), the current operation is to assist franchisees through investment and provide high-quality training for franchisees’ employees. Meanwhile, Harvey Norman position through the provision of strategic assistance to franchisees where necessary. However, with the increasing of franchise sales and profitability, the level of strategic support from franchisees was decreased significantly (“Harvey Holdings Limited: Annual Report,” 2014). David Jones Ltd, Woolworths Ltd and Myer Holding Ltd are the main competitors of Harvey Norman, and the fierce competition is based on price rivalry. Furthermore, with the entry of international and online retailers, the market has been changed significantly. Macro-environmental factorsA PESTLE analysis assists an organization to evaluate macro environment （PESTLE analysis，2009）. A PESTLE analysis for Harvey Norman as below: Political Firstly, Harvey Norman has benefits from an economic stimulus program by Australia federal government to encourage customer purchasing during a strong economic recession during 2009（Leigh, 2012). However, the government has increased the tax rate from 23.13% in 2013 to 29.50% in 2014, this will have a negative impact on the company’s net profit after tax (“Harvey Holdings Limited: Annual Report,” 2014). The Omni channel strategy will be continue executed and reinforced to offset the negative effect on tax policy.
Economic With the increasing sales trend and continue focus on franchisees’ expansion within homemaker categories, the need for strategic support from franchisees has been reduced by nearly 19% during the 2013 financial year. The company will continue to focus on franchisee’s commitment to training and development to increase the overall customer experience (“Harvey Holdings Limited: Annual Report,” 2014). Furthermore, a large, strong property portfolio has been integrated into the Harvey Norman Omni channel tactic, the franchisees as tenants that pay a reliable and immobile income stream to the company. Lastly, the company-operated retail segment in New Zealand has significantly increased 18.7%, due to the stronger New Zealand currency. However, the sales stream from Ireland and Northern Ireland’s stores has been decreased because of irrationality of electrical and computer categories in the end of 2012 (“Harvey Holdings Limited: Annual Report,” 2014).
‘:A growing number of retail and online business segments are being developed with increased focus on services sector. With many of these services becoming a part of the retail environment, more information and understanding has increased the need for a proactive approach. In addition, and under the new approach with franchisees, most of the retail space in New Zealand is being developed with the same core approach that has been developed across Australia and around the world, as well as the global markets and the needs of global retailers, retailers and customers. The industry is expected to double in size between June 2015 and the December report from May 2017.
: The key features for retail with the continued expansion of franchisees have been the continued improvement in customer experience & growing customer base, as well as improved business operations. While the numbers of customers in those areas vary, its obvious that there is a more consistent and stable consumer experience. We anticipate that in 2015, a more successful future will be observed because consumers in those areas will feel the same satisfaction from a higher level of satisfaction than in past years. The new approach will allow more opportunity for customers to spend more time with local businesses, thus strengthening the brand.
There are a number of new customer needs that need more focus and more focus on services sectors where services are becoming more complex and in demand, such as in banking, retail, food and beverages, telecommunications, the financial industry.
:With the expansion of franchisees, we now have some momentum in the supply Chain and consumer and business side with many of the new segments operating for higher quality, and we expect to be fully in the supply chain as we approach the new year. In particular, recent results show strong consumer demand in the health industry, food, beverages and healthcare.
‗: The shift in business relationships has been particularly important for the companies that have been acquired by different segments and by different customer groups with different interests. There will also be a need to differentiate between their business models and their respective customers. Although the change to its business model reflects the changing nature of business practices of different sectors, our current strategy reflects the shifting interests and dynamics of various stakeholders. This will help to define some of the best business models for our business, and ensure that they are sustainable and are viable.
: As we look for the next opportunity and changing business models in the supply chain, we anticipate to add several new categories of services to our supply chain. This includes, for example, physical or service infrastructure, electronic manufacturing, or electronic products. These are already the core capabilities that will be integral to the core business models of our distribution, which include. These will enhance our value proposition to consumers and increase our overall strength in relation to our customers and our financial position as a financial provider.
Customers in the Supply Chain have the flexibility of changing supply chains and are better able to make independent strategic decisions. As a result of these changes and the overall changing business landscape, there are new consumer and business channels that are important for us.
‗: Business relationships are changing rapidly. In the supply chain today, these relationships include, for example, customer loyalty, customer loyalty programmes and services.
‗: We are more prepared to work with the industry and stakeholders. We believe that there will be a new type of supply chain which will enhance our brand and, consequently, create more satisfaction for consumers.