Myra’s Haircuts is currently facing competition from different business players. New businesses are increasing the level of competition in the industry. Some of the major competitors include barbershops, spas, and manicure stations. The agreeable fact is that Myra’s Haircuts are making good profits. Myra’s process of scheduling her customers and staff is ineffective. The business uses a word-of-mouth approach to attract its customers. Morningstar does not use modern technologies in her business. This gap makes it impossible for Myra’s Haircuts to get the best outcomes (Hanford, 2010). This essay uses Porter’s Five Forces to understand the issues affecting the business. The essay will also offer powerful solutions that can make Myra’s Haircuts successful.
Michael Porter’s Five Forces Model
Porter’s model makes it easier for many businesses to identify their competitive advantages. It also identifies the competitiveness of the targeted industry. Myra’s Haircuts is operating in a complex industry. This analysis will make it easier for the business to develop a new strategy (Hanford, 2010).
Buyer Power
The bargaining power of targeted customers is quite high. Many customers want quality services. The business should use competitive prices in order to attract more customers.
Supplier Power
This industry has many suppliers. Such suppliers are competing in order to achieve the best goals. Myra’s Haircuts should, therefore, identify the best suppliers in the market.
The threat of Substitute Services
The number of substitute services is on the rise. For instance, a similar business is opening about 5 miles away. The presence of similar services can eventually affect Myra’s business.
The threat of New Entrants
This industry is very attractive. This fact explains why new players are joining the industry. This threat will affect targeted organizational goals.
Rivalry among Existing Competitors
The level of rivalry among the current competitors is minimal. However, more competitors will emerge, thus making Morningstar’s business less profitable.
Strategy for Competitive Advantage
According to the above analysis, Myra’s Haircuts can remain profitable in the targeted industry. The level of competition is on the rise. However, a powerful competitive advantage will make it easier for the business to attract more customers. The important goal is to get maximum profits. The best strategy for this organization is Operational Effectiveness (OE). To begin with, Myra should manage her operations in order to attract more customers. She should also use a powerful strategy to schedule her employees (Hanford, 2010). This approach will ensure the targeted customers get quality services.
The business should also use modern technologies for effective inventory management. The inventory will ensure there are adequate supplies. The inventory system will ensure every product is stocked effectively. Myra will be using the inventory to monitor every product. The inventory will also improve the organization’s ordering process (Hanford, 2010). These practices will make the business more successful.
Supply Ordering
Myra Morningstar should improve most of her business processes. One of these processes is supply ordering. The use of modern technologies will ensure Myra’s Haircuts keeps track of every supplier. The new system will highlight the most competitive suppliers. The proposed system will make it possible for Myra to order different supplies at lower costs. An electronic ordering process will ensure Myra’s business saves money. The business will also collaborate with suppliers who offer free shipping. The use of technology will ensure the supply ordering process supports the targeted business goals (Hanford, 2010).
Reference List
Hanford, A. (2010). System Addict. Health & Beauty Salon, 32(3), 31-34. Web.