Using an extended example critically examine whether the sector matrix Essay

Using an extended example critically examine whether the sector matrix framework gives a better strategic understanding of product markets than the concepts of product or commodity chains - Essay Example This has given rise to the concept of commodity chain. Different firms with heterogeneous geographical distribution engaged in production activities of a commodity is said to constitute a global commodity chain. This is known as the Global Commodity Chain (GCC) model. (Dicken P., 2003) According to Hopkins and Wallerstein a commodity chain is defined as â€Å"a network of labor and production processes whose end result is a finished commodity†. The process of production of a commodity is of main importance in the commodity chain. The entire process can be thought of being comprised of a network of points where each point is related to its preceding one in terms of procuring raw material, production, distribution and consumption. These interorganaisational points are technically defined as ‘nodes’. The geographical location of the nodes is generally different from one another. This explanation provides an innovative view for explaining the global inequalities in development. The nodes that are located at the periphery of the network are open to more competition than the nodes at the centre. As a result, central nodes are subject to more aggregate wealth than the peripheral nodes. This distribution is augmented by competitive pressures of innovat ion that flows from the centre to the periphery. It is natural that the core areas will enjoy better support facilities like infrastructure than the peripheral area. (Birch K., April 2006) The Value Chain Analysis developed by Michael Porter is an important tool in the hands of business managers that help to increase the value of the offering by a firm.. The generic value chain model suggests of breaking the entire set of activities undertaken by a firm into primary activities and support activities. The primary value chain activities include inbound logistics, operations, outbound logistics, marketing and after sales

Giving economic circumstances over the last five years of how Tesco, Literature review - 1

Giving economic circumstances over the last five years of how Tesco, Sainsbury and Morrisons have coped - Literature review Example I will analyze those data along with the theoretical aspects of that. This part will contain the consumer behaviour towards the retail chains for the last five years, brand loyalty of them. The companies’ strategy for maintain the loyal base of customer will also be analyzed as well as analyzing the impact of the strategies on the customers. The recession witnessed from the year 2008 to 2011 had a greater impact on the UK chain and retail market in general. Consequently, leading players in the retail market such as Tesco, Sainsbury and Morrison’s were equally affected. The general impact was occasioned by public (consumer) response to the imminent financial and economical changes. The global recession was characterized by increased prices due to inflation, higher oil prices from exporting countries in Asia and North Africa. Due to the overall changes, the consumers have become value based in terms of key commodities they value with view to the available disposable income (Gbadamosi and Nwankwo 2010). The implication of this change in behavior is that consumers are willing to pay higher prices for valuable commodities if they meet the required standards of quality. Further, the consumers seek to find alternative products which are affordable where quality is not their main concern. The chain stores have been forced to respond to this change in consumer behavior which is actively evident in their promotional strategies. Retail companies carry promotion with the view of convincing the consumer of the intended quality at low cost. Such is the need that Tesco announced an investment of  £500m to facilitate price cuts, Sainsbury has been forced to change from their long term slogan of trying something new to living well at low cost with the view of maintaining customer loyalty. There is low consumer confidence in the UK economy which is expected to fall further. This offers a great challenge to retail stores especially, Tesco,