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The report will focus on the marketing concepts by considering the company Toyota. The main purpose of the paper is to evaluate the factors which are internal and external in reference to Toyota Company. This report will first discuss the micro environmental factors that will affect the overall activities of the company. The factors which are related to micro analysis will be Porter five forces model. Second phase of the report will discuss about the competitors prevailing in the market. Lastly, the focus will be given on SWOT Analysis that will assist to evaluate the strength, weakness, opportunities and threats.
Political factor
In context to automobile industry it has been analyzed that there are various factors related to political framework like political stability and also many geopolitical tendencies. There are many examples which are related with the political factors. A stark impacted the overall performance of the company which also has poor relations with Japan and China. It is important for the company to focus on political stability so that growth can be attained. Also the company engaged in the political battle in Australia 2014. The controversies which took place were concerned with royal commission policies which are introduced by the Prime Minister Tony Abbot. So, the company announced that the manufacturing unit in Australia will be ceased in 2017 (Sisson & Elshennawy, 2015).
Economic factor
In this factor there are economic factors like rate of inflation, currency exchange and also tax rates that affect the entire revenue of the company. In context to the exchange rate fluctuations takes place which impact the Toyota revenue. The company operating the income for the fiscal year 2014 also considered the 900 billion boost just because of the weakening of Japanese yen against the USD. Also the sales of the company were declined by about 58 percent to 8,206 units in the 2014 by also considering the entire profits. It is necessary to consider the external factors as it can help to analyze the inflation rate and it has been seen that inflation rate has been declined by 0.9 percent in India (Colmorn & Hülsmann, 2014).
Social factors
There are various environmental implications related with driving a vehicle and it is necessary to address this as it is important in context to the social tendency. Toyota is focusing on considering this problem by enhancing its emphasis on electric and hybrid cars like Toyota Prius. The company also faces impact because of various factors like family values and also views towards automobiles (Debnath, 2015).
Situation Analysis
Technological factor
Toyota focuses on investing huge capital on the latest technologies. It has been seen that company introduced the cars that are low on the fuel consumption and also focuses on maintaining the environment. Also with the latest technology the company can easily market the products through social media sites.
Environmental factor
The company is focusing on the concept of sustainability. There are many milestones which are achieved by the company in the environmental area. The company also emphasized on the challenge related to New Vehicle Zero challenge in which the objective is to reduce the vehicle Co2 emissions by approximately 90 percent (Rothaermel, 2015).
Legal factor
Toyota is emphasizing in maintaining the safety of the passengers and has implemented the internal controls so that it can be legal compliance can be considered. The company considered the guiding principles so that it can be simple for the company to fulfill the responsibilities.
Bargaining power of suppliers
It is weak in case of Toyota as there are many suppliers in the market. The moderate size is also considered as one of the reason that can influence of the company. The suppliers are small but it minimizes the ability to integrate forward. Thus, it has been seen that the suppliers reduce the ability to integrate forward. So, there are many chances of the high competition from the Toyota. The company can easily switch to the new suppliers.
Bargaining power of the customers
It is strong as customers are important part of the vehicle company. The customers have many choices to choose from and they can switch easily to any product of low price. There are also competitors who are selling same products at same price. The customers are high highly informed and they can choose the best for them among various services of the companies (Mukherjee, 2018).
Threat of substitutes
It is moderate as vehicles are made by the other brands also there are various substitutes of the product in the market. The switching cost is low and also there are many substitutes in the market. The company introduced models that are low in fuel consumption and also good for environment.
Threat of new entrants
It is weak as capital investment is high in this field. The company who is focusing to enter into the market has to focus on the supply chain and also on hiring the skilled human resources.
Macro-environmental factors
Competitive rivalry
It is high as there are many small players who are aggressively a part of marketing and business. The competition level has also enhanced the cost of research and development and marketing. Some of the competitors of the company are ford and Honda.
The competitors of the company are Honda and ford. It can be analyzed that services which are offered by these companies are similar as Toyota. Also these companies emphasize on attaining the large market share so that threat can be reduced. In the competitive market, the competition level is high which should be reduced by focusing on effective pricing strategies so that growth can be attained.
Strength
The company has strong human resource and also they are skilled and professional. It has been seen that company have focused on investing into the human resources and it return achieved large market share. Also the company organizational culture of the company is innovative which helped the company to be on the top. The company also has diversified varieties in their product line.
Weakness
The company is dependent on the suppliers which make the production process slow. It has been seen that the company create green vehicle technology and failed to grab the actual market. The market of India and china can be best to introduce these vehicles. Also the company has to face the negative publicity just because of the large vehicle recalls. Also the recall rate is high in the company which creates the negative image in the public (Dominici, 2017).
Opportunities
The growth of developing nations in context to Toyota as the company has the chance to expand the market share by focusing on the developing nations. It will help the company to create goodwill in the market and also demand will be enhanced of the services. The company also has the opportunity to focus on green vehicle so that popularity can be maintained in the market. Toyota emphasizes on the areas so that it can be easy to earn more revenue to achieve growth in the market.
Threats
There are many competitors of the company prevailing in the market like ford, Hyundai and Honda. It makes difficult for the company to grab the large market share. Also the threat is related with high priced raw materials, as it has been seen that cost of raw material is enhancing and also it is increasing the cost of the end products (Li, 2018).
References
Colmorn, R., & Hülsmann, M. (2014). Strategic perspectives for electric mobility: some considerations about the automotive industry. In Evolutionary Paths Towards the Mobility Patterns of the Future (pp. 155-168). Springer, Berlin, Heidelberg.
Debnath, S. C. (2015). Environmental regulations become restriction or a cause for innovation–a case study of Toyota Prius and Nissan Leaf. Procedia-Social and Behavioral Sciences, 195, 324-333.
Dominici, G. (2017). Systems Thinking Research in the Twenty-First Century: A SWOT Analysis. International Journal of Systems and Society (IJSS), 4(1), 10-18.
Li, Z. (2018). Business Network Positioning Analysis of Toyota. American Journal of Industrial and Business Management, 8(07), 1693.
Mukherjee, I. (2018). Applying Porter’s Five Force Framework in Emerging Markets—Issues and Recommendations. In Strategic Marketing Issues in Emerging Markets (pp. 307-316). Springer, Singapore.
Research Methodology.(2018). Five force analysis: Retrieved from : https://research-methodology.net/apple-porters-five-forces-analysis-3/.
Rothaermel, F. T. (2015). Strategic management. McGraw-Hill Education.
Sisson, J., & Elshennawy, A. (2015). Achieving success with Lean: An analysis of key factors in Lean transformation at Toyota and beyond. International Journal of Lean six sigma, 6(3), 263-280.
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