A complete analysis of the management of a particular company consists of many factors. In particular, for an objective assessment of the situation, it is necessary to take into account the totality of aspects of the competitive environment and the macroenvironment. Evaluating existing competitors, customers and suppliers, and global elements such as legislation and technology provides the most accurate assessment of the company’s state. This paper aims to analyze Sally Beauty Holdings, Inc., highlight the factors of the competitive environment and the macro environment, and provide examples that affect this company within the indicated framework.
One of the essential factors that form the basis of competition in any field are opponents in the same niche. In the context of Sally Beauty Holdings, a company that sells and distributes professional cosmetics, this means a cosmetics economic niche. Accordingly, when analyzing the situation in a company, it is necessary to compare its position and success with similar market participants. The rest of the factors included in this category are decreasing in scale while retaining their significance. Analysis of suppliers allows to identify similarities among different companies, as well as find a more profitable logistics scheme. Finally, by analyzing the market of buyers who are in direct contact with the company’s products, one can get an idea of the target audience (“Know your competitive environment,” 2015). When combined with a broader analysis of company policy, it can be understood how the audience reacts to specific actions.
Macro-environment factors include broad concepts, the influence of companies on which is minimal. This list contains images such as politics, economics, technology and their development, demography. The situation in society, current trends, and new elements indirectly shape the company’s policy. Any organization has to adapt to changing conditions to maintain its relevance. The government of a country, for example, can introduce restrictive measures forcing to rethink the course of development completely (Claessens, 2015). From the point of view of the economy and society, non-compliance with existing trends and a failed attempt to adapt can lead to the entire company’s collapse.
In the context of Sally Beauty Holdings, i.e., the cosmetics market, there is quite a lot of competition. The production of cosmetics is a reasonably popular niche, so new players periodically appear in it. Such a company, in this case, is Sephora Usa, Inc. It is notable for its relatively small number of employees, but high gross income, which some large companies can match in its ratio (D&B Hoovers, 2020). Consequently, the emergence of such a new player affects Sally Beauty Holdings to partially revising its policy and preparing for a possible increase in competition from the newcomer.
Another competitive challenge facing the company was supply chain problems. While the company was able to increase its sales in 2019, it did so by rising prices rather than the number of products (D&B Hoovers, 2020). In this case, supply disruptions forced the company to revise its pricing policy, adapt to changing conditions, and keep up with competitors. An example of the influence of macroenvironment factors can be the development of technologies and the popularization of e-commerce. The proliferation of mobile technology, contactless shopping, and online shopping and the benefits obtained from this type of trading have pushed Sally Beauty Holdings to develop its mobile application and develop this market segment (D&B Hoovers, 2020). According to the idea, such a step was necessary to test a new model of work for delivering the company’s products directly to customers’ homes.
Thus, the factors necessary for the analysis of the company’s management can be divided into two categories: elements of the competitive environment and elements of the macro environment. Both types are essential for researching both the current state of affairs and prospects. These factors can influence in different ways, as seen above with the example of Sally Beauty Holdings.
Reference
Claessens, D. (2015). The macro environment – Six forces in the environment of a business.Web.
D&B Hoovers. (2020). Sally Beauty Holdings, Inc. Profile. Web.
Know your competitive environment to build business strategies for success! (2018). Web.