External Environment Analysis of Dropzone.Delivery

It is a fact that a company must have complete knowledge of its internal and external environment. It is critical for them to know how things are affecting them from the external environment, and how they can keep things on the right track by effectively managing their external environment. Dropzone.Delivery is working in the industry of logistics, where major portion of their business is associated with transportation and delivery. The company has to look for certain opportunities as well as threats in its industry to manage things in a comprehensive manner. This analysis would help Dropzone.Delivery to not only scan and monitor the external environment, but it will also help them to forecast and assess the situation so that they can develop a considerable future strategy.

5.1 The Analysis of Opportunities & Threats of Dropzone.Delivery

            It is vital for Dropzone.Delivery to get a complete overview of its opportunities and threats, which it can get from its relevant industry. Dropzone.Delivery is based in the UK and it has to look at different opportunities. The stats have revealed that the worth of the UK’s logistics industry is $118.3b, which shows its huge volume and its role in the economic activity of the country. Dropzone.Delivery can have so many opportunities in this large scale industry as they can expand their services from the UK to other countries. They can start logistics supply and delivery across other destinations of the world, as the UK is one of the largest exporters in the world. So, the expansion of their business on the international level is a huge opportunity (Mordor Intelligence, 2018). At the same time, they have many threats to deal with such as the threat of intense competition from biggest competitors as well as giants of the business. There are companies like DHL and Addison Lee, which are constant threats for Dropzone.Delivery, because these companies have an international reputation. DHL is one of the largest companies in the world, so it is not easy for Dropzone.Delivery delivery to compete with these companies. Moreover, the consumer preferences are changing and it is also a threat so they need to develop a differentiated strategy to win the trust of potential customers (Lookman, 2019). It is expected that competition from international companies will get more intense in the future, so they must be prepared to take this challenge.

5.2 Analysis of the General Environment of Dropzone.Delivery

            Dropzone.Delivery has to realize that a general external environment comes with so many elements and each element is critical for their business and its long term success. The first major component is the political situation. The political situation in the UK is stable and democracy is in place to serve people. If a country is not politically stable, then it can really create problems for business companies, but there is no such worry for Dropzone.Delivery. The other important component is the technological aspect. The technology is increasing its presence in every industry and the logistics & courier industry is also observing this change like Amazon has started to deliver customer’s orders with drones. So, these technological changes come up with so many threats but opportunities as well. The third important element is legal, and the UK has supportive laws to help the industry to grow (Hannagan, 2001)

 5.3 Five Forces Analysis of Dropzone.Delivery

·         Threats of New Entrants: Looking at the dynamics and scale of the industry, it is not easy for a new logistics and courier companies to enter the UK’s market as it has intense competition. There are so many international companies, who have great resources and equipment, and they also have expanded business with great reach, and to meet their standard, a new company will need huge investment. So, the threat of new entrants is low.

·        The Threat of Substitutes: There are so many local as well as international companies in the UK market so it is a constant pressure on small scale companies to compete with larger ones, because they have great range of services. So, the threat of substitutes is high for companies.

·         Bargaining Power of Suppliers: In the logistics and courier industry, the bargaining power of suppliers is very low. For instance, automobile suppliers are relevant suppliers are major supplier for this industry and there are so many options available in this regard.

·         Bargaining Power of Buyers: In this industry, the differentiation factor is a very minimum level, and customers can also look for various affordable options in the market without any particular switching costs, so the bargaining power of buyers is a bit high.

·         Competitive Rivalry: There are so many huge international players in the market and industry also does not come up with many differentiation options. So, companies compete on prices and quality of service, which means that competitive rivalry, is very high in this industry

5.4 Competitor Environment of Dropzone.Delivery

            It was mentioned earlier that there are many international companies, which have great reputation as well as expanded business across the globe, so it is difficult for Dropzone.Delivery to deal with such intense competition on a regular basis.

6. Internal Environmental Analysis of Dropzone.Delivery

            It is vital for Dropzone.Delivery to understand that internal environment is as important as the external environment is. The company must know about its internal capabilities as well as resources to move forward with a right approach. The internal environment is critical to know about strengths and weaknesses of the company so that detailed planning and strategy is developed for the future (Campbell, Edgar, & Stonehouse, 2011)

6.1 Analysis of the Resources of the Company of Dropzone.Delivery

            The company has limited resources as they are only dealing with the courier and small-scale logistics, so they need to expand their reach in the market by offering new range of services, and for this purpose they need to expand their resources.

6.2 Analysis of the Capability of the Company of Dropzone.Delivery

            Dropzone.Delivery has good enough capabilities to serve the needs of its customers. They provide reliable as well as dedicated delivery services. The dedicated delivery service of the company is to deal with customized delivery for a customer, rather than delivering through multi-drop. The company is providing high-value insurances for the valuables being delivered, so customers can feel secure when they use the services of Dropzone.Delivery (Dropzone.Delivery, 2019)

6.3 The Criteria of Sustainable Competitive Advantage of Dropzone.Delivery

            It is important for Dropzone.Delivery to understand the four criteria, which is used to identify the core competencies for sustainable competitive advantage. The major and core competency of the company is its professional service along with secure high-value services. They make sure that customers not only get reliable services, but they also get secure services and don’t worry about the safety and security of their valuables being delivered. However, the company should work more to get more core competencies to compete with their competitors so that they can stay ahead in the competition.

6.4 Value Chain Analysis of Dropzone.Delivery

            The company has a dedicated order entry system, which allows maintaining a record of the orders placed by customers. This ordering system has all the important information like what order was made, where it has to be delivered, and information regarding the recipient like their address and phone number, etc. The company also has well enough IT system, which allows them to manage their supply chain effectively.

6.5 A Summary Table of Dropzone.Delivery

References of Dropzone.Delivery

Campbell, D., Edgar, D., & Stonehouse, G. (2011). Business Strategy: An Introduction (3rd Edition ed.). Macmillan International Higher Education.

Dropzone.Delivery. (2019). Dropzone.Delivery. Retrieved October 22, 2019, from https://www.dropzone.delivery/

Hannagan, T. (2001). Mastering Strategic Management. Macmillan International Higher Education.

Lookman, H. (2019). Courier Service Uk: Top 10 Courier Companies in the UK. Retrieved October 22, 2019, from https://trustheritagelogistics.co.uk/courier-service-uk/

Mordor Intelligence. (2018). United Kingdom Freight and Logistics Market - Segmented by Mode of Transport Type, Function Type, and End-user Type - Growth, Trends, and Forecast (2018 - 2023). Retrieved October 22, 2019