TASK 3c

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BE_10 COMPETITIVE STRATEGIES &

COMPETITION COMMISSION

TASK 3CSources:

1.BPP Business Environment Coursebook (pages 252-257)

2.BPP Marketing Coursebook

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Competitive Strategies

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Market segmentation (p.252-253)

Marketing mix (p.254-256)

Porter’s Generic Strategies/Competitive Strategies (p. 256-257) - see next slides

Three (3) Types of Porter’s Generic Strategies / Competitive Strategies

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1. Cost leadership strategy – firms always seeks the lowest - price for their products. Producing products at the lowest-price not only help firms compete with other producers but also create the highest unit profits. (BPP Professional Education, 2004, p. 257)

2. Focus strategy - based on segmenting the market and focusing on particular market segments. The firms will focus on a particular type of buyer or geographical area.

1. A cost-focus strategy involves selecting a segment of the market and specializing in a product (or product) for that segment.

2. A different-focus strategy involves selecting a segment of the market and competing on the basis of product differentiation for that segment. (BPP Professional Education, 2004, p. 257)

Competitive Strategies

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3. Differentiation strategy - based on the assumption that competitive advantage can be gained through particular characteristics of a firm’s products or brands. The customer is prepared to pay more for this distinguish characteristic. Some types of characteristics:

Colour differences Size differences Different wrapping or containers Variants of the product for different market segment Small change in products’ formulation to maintain their

novelty value Different technical specifications

Through it, they will create a particular impression for customer. (BPP Professional Education, 2004, p. 257)

Competition Commission

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The Competition Commission (CC) is one of the independent public bodies which help ensure healthy competition between companies in the UK for the benefit of companies, customers and the economy. It was established by the Competition Act 1998. It replaced the Monopolies and Mergers Commission on 1st April 1999.

Role of competition commission

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The Competition Commission conducts in-depth inquiries into mergers, markets and the regulation of the major regulated industries. Every inquiry is undertake in response to a reference made to it by another authority: usually by the Office of Fair Trading (OFT) but in certain circumstances the Secretary of State, or by the regulators under sector-specific legislative provisions relating to regulated industries . The Commission has no power to conduct inquiries on its own initiative.

Role of competition commission

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In most merger and market references the Commission is responsible for making decisions on the competition questions, implement decisions on appropriate remedies.

Under the legislation that the Act replaces, the Commission had to determine whether matter were against the public interest.

The Office of Fair Trading (OFT)

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The primary role of the Office of Fair Trading is to manage these consumer laws and to look after the rights of consumers. At the same time, the OFT advise businesses and traders on fair and ethical practices. The OFT’s aim is to achieve fairness for all in the marketplace.

Role of Office of Fair Trading (OFT)

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Ensure that consumers have as much choice as possible across all different sectors of the marketplace

Promote and protect consumer interest throughout the UK

Ensure that businesses are fair and competitive

Regulation

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A company has to obey not only laws of Vietnam but also particular laws of other nations in which the company export products.

Role of regulatory bodies in Viet Nam

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Vietnam Competition Council, Short is VCC. As agencies of the state monitoring business marketers of enterprises in Vietnam. In addition to VCC. Vietnam also has one other organization. Organizations such as Vietnam Competition Administration Department, abbreviated as VCAD.The role of VCC and VCAD very important. VCC VCAD and has management and treatment of business enterprises in the territory of Vietnam.

Do more research…

Role of regulatory bodies in Viet Nam

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Making policies to protect environments, consumers, and so on about the standards of quality, tax, and other areas.

Make recommendations on the use of reasonable price for shoe manufacturers

Planning for effective regional shoe manufacturing

Organize production, increased capital investment for businesses and the shoe manufacturing industry.

Role of regulatory bodies in foreign countries (UK)

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Giving law imported shoe products more closely to ensure quality.

Make regulations on tax and customs import of shoe products

(You may refer to pages 267 – 269)

Role of regulatory bodies in foreign countries (UK)

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Products have to follow the standards of International Standardisation Organization – ISO was established in 1964. For example, when exporting in EU and UK, Giay Viet hs to follow the standards of ISO 9000 including three standards ISO 9001, ISO 9002, ISO 9003.

Simplifying customs tax to speed up the process of importing

Do more research…

Task 3c

Explain the behavior and competitive strategies employed by Trung Nguyen

Coffee and discuss the role of the competition commission and regulatory bodies

(Prepare a presentation using MS Powerpoint)