Unit 2 DB – 2 SR

Response 1:
What are the best tools to use in this situation? 
Deciding to expand your business into another country is a huge business decision and should be analyzed at every possible angle. In order to approach this decision objectively, there are a few methods that can be used in order to systematically access the pros and cons of this decision. A commonly used approach is a process called a SWOT analysis. SWOT is an acronym that stands for strengths, weaknesses, opportunities and threats (Colorado Technical University, 2018). Rather than just listing pros and cons of a decision, this method adds anther dimension to the analytical process. A SWOT analysis views a situation from an internal as well as external point of view (Online Extra, 2009). An internal review gives one the opportunity to step back and analyze one’s own strengths and weakness helps to obtain a better perspective of the assets and liabilities that one has to work with. An external review of a decision will allow one to analyze the opportunities that one might consider as well as the threats that might need to be anticipated. (Online Extra, 2009) The actions that can be taken with a SWOT analysis can be summarized with USED – “How can strengths be used; the weaknesses be stopped; the opportunities be exploited; and the threats be defended against” (Online Extra, 2009)? 
Another analytical process is called Porter’s Five Forces. (Jurevicius, 2013) Porter’s model breaks down the competitive forces in the market into five general categories. Two of the opposing forces are the bargaining power of buyers and suppliers. (Jurevicius, 2013). Without buyers we would not be able to have a product to sell to consumers. Because of this buyers have an influence over the business. Similarly, suppliers gain their influence from the fact that without them the business would not have a product. Once an industry is successful, other entrepreneurs  will attempt to move in on the profitability which creates a threat of new entrants to the market creating competition. (Jurevicius, 2013) Another force that can threaten the business is a threat of substitute products that may become available.  Finally, there is the threat of rivalry from competitors within the industry. (Jurevicius, 2013). Keeping these five forces balanced is a constant struggle in order to keep your own business strong – but worth it. 
Why do you think these are the best ways to analyze the market? 
There are many varying models that can be used to analyze decision-making and each can have their own advantages and disadvantages. The type and severity of the impact from a decision can guide which model might best fit situation. The two models mentioned previously are good models for taking stock of the current state of the business itself as well as the industry. 
How will you use these tools in your plan? 
A SWOT analysis can be used to determine where Ferrer’s furniture business currently stands and might give clarity on what direction the business might be able to go. Porter’s Five Forces can also help to analyze where the furniture industry currently stands. The Ferrer furniture business’ strengths are the quality products they offer, their in-house design team, and their reputation for good customer service. They are currently under a threat of losing profitably because of changes in the market and a threat of new entrants with lower-cost products. Although the Ferrer’s are considering the idea of expansion into another country, this may not be the only opportunity available. The Ferrer’s should also consider an opportunity of purchasing out smaller companies or suppliers in order increase market share or profitability. A review of the market forces would also benefit the Ferrer’s. In fact, this model should be visited regularly in order to stay vigilant in the industry and maintain a balance.

Response 2:
 
Introduction
 As we know our company has been losing domestic profits and we are looking to make up those profits by expanding into the foreign market.  We must make sure that expanding into these markets will make good business and financial sense for the company.  We will need to make sure that expanding our business overseas is going to improve our profits not make them worse by putting an over strain on the company financially from the expansion and then ultimately not yielding the profits we set out to make up in the first place.  In the following discussion we are going to determine the tools that are needed to conduct an analysis of the industry and competitors.  This will give us the insight to see if an overseas expansion is in our best interest.
What are the best tools to use in this situation? Provide a brief summary of at least 2 of these tools.
 Some of the tools that we will use in this analysis will be the S.W.O.T and P.E.S.T. tools.  S.W.O.T. stands for Strengths, Weakness, Opportunities and Threats.  A SWOT analysis is an organized list of your business’s greatest strengths, weaknesses, opportunities, and threats. Strengths and weaknesses are internal to the company (think: reputation, patents, location). You can change them over time but not without some work. Opportunities and threats are external (think: suppliers, competitors, prices)—they are out there in the market, happening whether you like it or not. You can’t change them (Berry, 2018).  P.E.S.T. stands for Political, Economic, Socio-Cultural and Technological.  Basically, a PEST analysis helps you determine how these factors will affect the performance and activities of your business in the long-term (Pestle, 2013).  We will use both analysis models to come up with the information that will ultimately lead to our conclusion of whether we should expand overseas or not.
Why do you think these are the best ways to analyze the market?
The reason why we think these are the best analysis models to use is because they cover two distinct aspects of the overall analysis.  PEST Analysis is often linked with SWOT Analysis, however, the two tools have different areas of focus. PEST Analysis looks at “big picture” factors that might influence a decision, a market, or a potential new business. SWOT Analysis explores these factors at a business, product-line or product level.  These tools complement one another and are often used together (Mind Tools, 2018).  By using both models we will insure that we are covering all aspects of our analysis.  This will be very important because we need to make sure we take everything into account when considering this new venture.
How will you use these tools in your plan?
 The way in which we will use these tools of analysis in our plan will be to take a good luck at the data that both of these models cover.  Since both of these models take a look at two different distinct areas of the same overall situation, this will make sure that we have covered everything we need to cover.  Ultimately these tools will be used to determine whether or not we think expanding overseas will be a good idea or not.  These tools will be the driving forces in whether we expand overseas or keep our operations domestic.
Conclusion
 Now that we have identified the various tools we will use to measure all the conceivable aspects of expanding overseas.  We can feel confident that we are doing everything we can and using all the tools that we can to come up with a sound decision.  These tools coupled with our other explorative research will complement each other and let us know which direction we should go in.