External And Internal Environmental Factors In Open Water Fish Farming In British Columbia

FADS and Mega Trends of the Open Water Fish Farming in British Columbia

Discuss about the external and internal environmental factors in open water fish farming in British Columbia.

In the current time, there are number of new business sectors emerged in global market. Some of these sectors are completely new in nature while the others are the simple modification of the existing businesses in more sustainable way. One of the major business trends in the recent time is growing popularity of open water fish farming in some countries such as British Columbia (Cranford, Reid & Robinson, 2013). However, there are number of negative and positive factors being faced by this industry in the recent time. This is due to the reason that there are number of sustainability related issues being emerged with the open water fish farming. In addition, the initiation of the strict government regulations is also having impact on this industry.

This report will discuss about the external and internal environment of the identified industry along with understanding the core impacts. In addition, the competitiveness in this industry will also be discussed and evaluated in this report. The most influential competitive forces will be identified for the identified industry.

The Open net fish farms are regulated by the federal government.  In recent times, the government had become particularly concerned about the protection of wild salmon and the migratory routes in order to ensure that the closed containment is feasible. Various government to government discussions have been launched. In order to ensure and compact the future of the 18 fish farm tenures in the Broughton Archipelago (CBC News, 2018). There have been various protests with respect to the Marine Harvest in the territory. The Namgis First Nation was the party which protested against it.

The government has given increasing importance to closed containment as opposed to open water farming which has then brought about increasing difficulties in the open water farming. Similarly, the profitability in the open water farming has been going down considerably as compared to the closed containment.

Recently, there had been a Salmon spill in the Open water Farming, which has again lead to a momentum in the closed water containment and the benefits of land based aquaculture have been rising. The companies are not in favor of this as they will have to adopt new methods and trends in order to gain government assistance.  This tends to be an extra cost for the firms.

PESTLE Analysis

According to Barney (2014), the aquaculture industry in the British Culture has been very controversial since the past few years and with respect to the environmental concerns this has led to a decline in the wild salmon populations. There has also been a rise in the spread of viruses which further builds the case for the decline in open fish farming in the British Columbia.

Figure 1: The Fishing in BC (Source:CBC News, 2018).

The PESTLE Analysis is a strategic management tool which can be used to analyze a long term scenario of the Open Fish Farming industry. The PESTLE Analysis tends to analyze the Political, Economic, Social, Technological, Legal and Environmental aspects.

Political factors

• There exists a low political interest among the public with regard to the open fish farming in BC. Hence, from there se, there is little or no pressure on the government with respect to this.
• The politicians as well have low interest on commercial fishing
• However, due to environmental concerns there is a large concern for the loss of lives and spread of virus of the fish population (co.uk, 2018). The processes are also influenced to be improved.
• As there have been frequent changes in the policies due to the change in government, there exists instability.

Economic Factors

• The low and average catches tend to have an impact on the ability to invest and the capacity to improve the open water fish farming.
• There exists low purchasing power among the different customers in the domestic market.
• The impact of the economic crisis has been huge on the high value markets.
• The limited financial knowledge among the different businessmen tends to impact the operations of the firm (co.uk, 2018).
• Climatic changes and natural disasters tend to be a barrier to the business and reduce profitability.

Socio-Cultural Factors

• There exists poor knowledge of handling the different open farming fisheries with low level of technology which affects the business. Even if the technology advances, it tends to have an impact on the operations of the firm as the technological advancements are very costly.
• There are various safety and health problems due to the poor quality of harvest which has an impact on the harvesting nature.
• In recent years, there has been an increasing trend of going vegetarian which further has an impact on the harvested items
• The lack of licenses and adequate awareness in the domain also causes distress.

Technological factors

• The infrastructure in certain areas is not that advanced with respect to the machinery, tools, practices and facilities.
• The technology which is then available is very expensive and due to the poor nature of the business, they are unable to update with this (Hill, Jones & Schilling, 2014).
• The processing facilities are inadequate in nature
• Hygiene factors regarding technology are not adequate in nature
• There are no appropriate facilities with respect to both air, water and rail transportation.

Legal Factors

There are different legal factors having an impact on the operations of the industry:

• There are different regulations and monitoring with respect to the :

 Quality standards

 Food safety

 Hygiene standards

 Fish handling

 Illegal inland fishing

• In the international export markets there are a different set of regulations.
• There exists general trade agreements and tariffs regarding the open fish farming.

Environmental factors

The different environmental factor are as follows:

• Insufficient availability of desirable clean water
• Loss of biodiversity
• Tropical weather conditions and climates
• Oil spills in the harbors (Ginter, Duncan & Swayne, 2018). 
• Sustainability of the fish stocks

Hence, it can be stated that, the main factors that need to be analyzed are the political factors which relates to the government intervention in the open water fish farming and its trends in British Columbia. Furthermore, the environmental factors also need to be considered.

Thus, from the above five forces, it is identified that the impact of substitute products is the major influential competitive forces in the open water fishing industry in British Columbia. This is mainly due to the reason that there are number of buyers are present in the industry with having similar offerings. Thus for the new entrants, they should come up with different and varied offerings.

Conclusion

Thus, it can be concluded that open water fish farming in British Columbia is having number of negative and positive external factors to consider. In addition, this report also identified about some major competitive factors in this industry and their potential impacts on the business. It is concluded that initiation of the differentiation strategy will help the new entrants in offering distinctive products and overcoming the intensity of the substitution factor.

References

B.C. government ‘very interested’ in moving open-net fish farms onto land, minister says | CBC News. (2018). Retrieved from https://www.cbc.ca/news/canada/british-columbia/fish-farms-bc-closed-containment-donaldson-tenures-1.4566374

Barney, J. B. (2014). Gaining and sustaining competitive advantage. Pearson higher Ed.

Britishseafishing.co.uk. (2018). Fish Farming and Aquaculture | Britishseafishing.co.uk. [online] Available at: https://britishseafishing.co.uk/fish-farming-and-processing/ [Accessed 27 Jun. 2018].

Britishtrout.co.uk. (2018). Trout Farming | British Trout Association. [online] Available at: https://britishtrout.co.uk/trout/farming-trout/ [Accessed 27 Jun. 2018].

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Cranford, P. J., Reid, G. K., & Robinson, S. M. (2013). Open water integrated multi-trophic aquaculture: constraints on the effectiveness of mussels as an organic extractive component. Aquaculture Environment Interactions, 4(2), 163-173.

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El-Sayed, A.F.M., Dickson, M.W. & El-Naggar, G.O., 2015. Value chain analysis of the aquaculture feed sector in Egypt. Aquaculture, 437, pp.92-101.

Ginter, P. M., Duncan, W. J., & Swayne, L. E. (2018). The strategic management of health care organizations. John Wiley & Sons.

Hill, C. W., Jones, G. R., & Schilling, M. A. (2014). Strategic management: theory: an integrated approach. Cengage Learning.

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Somerville, C., Cohen, M., Pantanella, E., Stankus, A., & Lovatelli, A. (2014). Small-scale aquaponic food production: integrated fish and plant farming. FAO Fisheries and Aquaculture Technical Paper, (589), I.

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