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In order to effectively analyse Luxury Boats Ltd. and the framework of macro-environmental factors affecting the business, two analytical tools will be used; the PEST Analysis and the SWOT Analysis.

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Contents * Introduction * PEST Analysis 1. Political 2. Economic 3. Social 4. Technological * SWOT Analysis 1. Strengths 2. Weaknesses 3. Opportunities 4. Threats * Conclusion and Recommendations * References MARC MENENDEZ 05260233 Introduction In order to effectively analyse Luxury Boats Ltd. and the framework of macro-environmental factors affecting the business, two analytical tools will be used; the PEST Analysis and the SWOT Analysis. The PEST Analysis will look at external factors affecting the business as well as giving an overview of the various macro-environmental influences that Luxury Boats Ltd. should take into account. The political circumstances that will be examined include tariffs and political stability. Economic factors will analyse general economic growth together with changes in exchange rates, inflation rate and interest rates, tax policy, trade restrictions, and employment laws. In the social factors section an examination of cultural conditions and social changes will be undertaken. Technological aspects looks at the rate of technological change. The first step in the SWOT analysis will be to identify the purpose or objectives of the analysis. The objectives of this SWOT analysis are to pin-point specific issues which affect or could affect Luxury Boats Ltd , determine how the company can counteract any problems, identify ways in which the business can increase profits and to provide for a logical conclusion to the general situation. The Strengths section will be concerned with Luxury Boats Ltd's positive characteristics, which will aid it in achieving the objectives mentioned above. Weaknesses will engage the negative areas of the business, which will hinder the general aims. The Opportunities section will concentrate on external factors that may assist and positively influence the attainability of the company goals. ...read more.


* The company is either over-staffed or is miss-allocating staff. This means the business is not using its employees to their full potential, as it has workers in areas where it does not need them. * Average price of almost �100,000 means that the business is relying on the small customer base who can afford this price range. Luxury items are very dependent on general economic factors. * Shortage of Capital. The company has a problem if it wishes to expand. * The company is overly dependent on exchange rates with 75% of its raw materials coming from other EU members. This leaves the business open to all kinds of troubles which will ultimately result in reduced profits. This has been highlighted recently by the finance department who noted an increase in prices for raw materials. It would appear that this is a direct result of the weakening of the pound sterling against the Euro which makes imports from E.E.U. countries more expensive. * Administration department appears to be over-stretched. 3. Opportunities * The weakening of the pound sterling against the Euro means that any UK exports would now be more competitively priced in the European market. Perhaps another assessment of the international market could be made. * Luxury Boats Ltd's competition are in serious trouble. It would appear so far that Luxury Boats has been one of the companies least affected by the current climate. There is an invaluable opportunity to establish the company as a market leader by tackling rival companies while they are most vulnerable. If the right decisions are made, the economic turmoil that the market is suffering, could be the most beneficial event in the history of the company. ...read more.


Dealing with contracts of employment, employee backgrounds and work practices is arguably a Human Resource area. Secondly, meeting and greeting customers and being the first point of contact for customers is a Customer service area. Finally, dealing with correspondence and ensuring the business is run smoothly is a General Administration responsibility. It is logical to state that if there is over-staffing in certain areas of the company and a miss-allocation of resources has been identified, the workforce resources should be redistributed more efficiently by creating a HR department and a Customer Service department. This step will increase quality throughout the company, increasing the long-term benefits of TQM. MARC MENENDEZ 05260233 Naturally, it will take a substantial investment to re-train staff and organise the changes, and business bank loans are increasingly difficult to obtain in the deteriorating economic climate at present. Entering the stock market as a PLC offers the improved potential for acquiring extra finance by issuing shares and through other investors as its main advantage. There are several disadvantages of becoming a PLC which must be taken into consideration. There are expensive set up cost involved in becoming a PLC company. Due to public trading of the shares, the company would be more susceptible to a hostile take-over. In addition, there is a tighter level of regulation applied to PLC companies. Finally, owners with a small amount of shares will not have any control over the running of the company. Once the company's resources have been efficiently distributed ensuring quality throughout, it may be possible to diversify in order to reduce risks and appeal to a wider market. Luxury Boats could appeal to a wider group of customers without damaging its exclusive image, by producing cheaper, more standardised versions of the vessels under a new brand name. ...read more.

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