Challenges of Company in Internal and External Environment

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  • Unit No: 1
  • Level: High school
  • Pages: 9 / Words 2170
  • Paper Type: Assignment
  • Course Code: BMM3013
  • Downloads: 569
Question :

Questions- This assessment will cover the following questions:

  • Evaluate the current external environment with the help of pestle analysis in the context of G- sports Ltd.
  • Generate in-depth understanding of the competition and what are the competitive advantage company have.
  • G- sports Ltd. Is an international bicycles manufacturer? Detail evaluation of the target market segment by the G- sports Ltd.
Answer :
Organization Selected : G-sport Ltd


1.1 Business idea- The business idea of G-sport Ltd is to sell sports watch using online website such as e-bay to the youth of the overall world. They have performed researches and develop a variety of watches like smart watch, smart band etc. which they plan to launch in the coming year of 2020.

1.2 Aim- the aim of the company is to gain market share in the sale of sport watches.

1.3 Location- They plan to sell this in all the developed countries where the demand for such luxurious products are high and the people in these countries are rich enough.

1.4 Outline- This report is a full business plan for G-sport Ltd to establish and run their business in the current world by tackling all the hurdles they are facing. This report shows the different challenges of the company which are being faced by them in both internal and external environment.



To Evaluate the Current Market Situations of G-sport Ltd a PESTLE Analysis has been Performed below:

Political factors

These are those factors which will affect the company the long term profitability of the company. If G-sport Ltd wants to introduce a new product then these factors are at most important to them. The company have to look at the political stability of the country they are going to introduce their new product, then they must have some good political relationship with that country. These factors are important because these will increase the cost to the company and their long term sustainability. Other political factors which will affect the business plan G-sport Ltd is the government intervention in the accessory's sector, governance system etc.

Economic factors

These are the factors which will impact the G-sport Ltd attractiveness of a given market. These factors include the interest rate, inflation rates, exchange rates etc., and the change in these factors will significantly affect the cost of the company as for example the adverse change in the interest rate will lead to increase finance cost for the fund being raised by the company. Since the company is starting its new business these factors should be given importance. To tackle these factors the company can enter into derivatives like forward contract and fix the interest and exchange rates so that they will secure these in the future.(Lynch, 2018)

Social Factors

These are the factors which include the change of the customer taste and preference in the market. G-sport Ltd must be updated with these factors so that the company can analyse the market demand and devise there product to suit the needs of their customers. The other social factors are the culture and values that an individual have in the organisation which include the attitude toward the authority, level of social concerns and awareness in the society, attitude toward health and safety etc. these can impact the day to day working of the organisation.(Dale, 2019)

Technological factors

These factors have come into picture in the last decade when the technological changes occurred frequently. Some of these technological changes in the auto mobile sector include the use of artificial intelligence, big data analytics to analyse the needs and demand of the customer, using online websites to sell their products, using social media to promote their watches etc. G-sport Ltd need to implement these technological changes if they want to survive in the market and increase there customer share to compete within the market. Also, they are new so the company need cheap techniques to promote there product and online promotions are way cheaper than TV and newspaper advertisements.

Environmental factors

These factors are also gaining too much attraction in the current situations where the environment is degrading at a fast pace. G-sport Ltd need to address these environmental issues like they must have proper waste management techniques to dump there waste otherwise these could cause pollution affecting the environment, they should operate in such a way so that their activities does not increase global warming affecting the climate, use of renewable resources for achievement of sustainability. G-sport Ltd will require the large investment to be made in order to operate in a sustainable way and as a part of its competitive strategies.(Wynne, 2016)

Legal factors

These are the conditions which G-sport Ltd will require to enter into a particular market. These are laws and regulations governing a particular state or province. G-sport Ltd will require to do a lot of paper work in order to follow up with these legal factors. These are very important as the if the company does not complete all these paper work they might have to have some legal actions in the future. Other legal factors that can affect G-sport Ltd includes the adherence to the local laws and regulations, data protection laws, laws related to especially the auto mobile sectors etc., these legal factors can increase the expenses of the company in case of non compliance.


To Analyse the Business Competition there has been the Analysis of Porter 5 forces in relation to G-sport Ltd given below:

Competitive rivalry

The industry in which G-sport Ltd is operating that is auto mobile industry is highly competitive. There are a large number of companies with well established business and brand image in the eye of the customer. Therefore, G-sport Ltd need to develop some strategies in order to compete in such a market. Firstly the company cannot set a price higher than there competitors as the customer will not prioritize their product because they are new in the market. Therefore, to gain the attention of the customer to the product of G-sport Ltd they will be requiring high level of advertisements, there product must have some differentiation this can be through innovation research and development so that they can devise customized product. There is a great need for G-sport Ltd to gain the competitive advantage in order survive in such a competitive market.

Bargaining Power of Customer

The bargaining power of the customer is dependant upon the factors like switching cost, differentiation, availability of substitutes etc., but the large number of buyers in the auto mobile industry is small individuals.(McKenzie, 2015) But whether they are small or large buyer the switching cost for them to an alternative brand is very low or nil, there are a large number of substitutes available for the customer to switch on. Therefore, the bargaining power in the auto mobile industry is considered to be moderately high. Therefore, G-sport Ltd must have some product differentiation or their car must be cheap to attract the customer to buy their product over there competitors.

Bargaining Power of Supplier

There is a large amount of supplier in the auto mobile industry which can supply to G-sport Ltd and only a few of these supplier are large in size. This is because the raw material are available in plenty and the companies can easily switch to other suppliers in case their supplier increase the prices. These supplier have to work according to the big players in the market like Fitbit, fossil etc., so their power to bargain with the companies operating in the auto mobile industry is considered to be low. G-sport Ltd can manipulate these suppliers so that they can get quality products at cheap rates. So the bargaining power of the supplier is weak in the auto mobile industry.

Threat of Substitutes

For the company G-sport Ltd the threat of substitute is very strong, as they are new in the market and there are a large number of competitors available in the market like Fitbit, fossil etc., and their brand image is so strong that the customer will always prefer there product over G-sport Ltd. Therefore, G-sport Ltd need to work on devising strategies which can help the company to make their product marketable and so that the customer prefer their product. The company need to keep their prices low until they create their brand image in the eyes of the customers or the customer will not even consider G-sport's product.

Also Read:- Culture, Politics and Power of the Company

Threat of New Entrants

Threat of any company entering into the auto mobile sector is very low as there are a lot of barriers for any company to enter. These barriers include the large amount of capital investment being required to enter into this sector, strong distribution network for the sales, a large amount of already well established brands etc., so for entering any new brand would require to tackle all these barriers in order to enter, and not all the individuals have the potential to do so. Therefore, the threat of new entrant is quite low. (McKenzie and Sansone, 2019)


STP is the most commonly applied model for the companies in current world to identify their current market. STP means the segmentation, targeting and positioning to develop the marketing strategies. In order to identify the target market G-sport Ltd can perform the analysis of STP, this analysis have been given below:


This process will help G-sport Ltd in distributing their customers into segments as the company cannot target each and every customer in the market. The company can use different ways to segment there target market. There are 4 different ways to segment which are demographic which includes the segmentation by age, gender, education etc., geographic which includes the segmentation by country, province, region etc., psychographic which includes the segmentation by the values, lifestyles, interest etc. and lastly behavioural which will include the usage of the product, benefit from the product etc. In the case of G-sport Ltd the company's main segment to target is the customer of the age group between 20 - 30, as the company is selling sport watches the youth will be very interested in purchasing them, the company should target developed country for the sale as in developed country people are more likely to prefer such luxurious products. This process of segmentation will help G-sport Ltd to increase there sales and this will help them in their long term strategies as the targeted market will be feasible for the company and they can thus maximize there profit per cent.


Once G-sport Ltd have identified there market segments the next step in the model is to target these segment to get the maximum profit from them. This is very crucial stage in the STP model.(Burns and Dewhursts, 2016) G-sport Ltd will need to think strategically in order to serve the market segments identified. Therefore, it is best to carry out the market analysis of the industry by using PESTLE analysis in order to get rid of all the assumptions of the market and then they can have a clear vision of the market. This can be explained with an example. If there are 2 segments available for G-sport Ltd and the 1st segment will generate a profit of $100 million and the 2nd will generate a profit of $150 million then the company would prefer the 2nd segment but G-sport Ltd must have enough investment to serve the demand of the 2nd segment. (Chambers and Humble, 2017)


The last step in the STP model is positioning which include how G-sport Ltd is going to place their watches in the segment that they have targeted in the last 2 steps. This will include having a unique selling proposition that the competitors cannot offer. This will help gain the attention of the customer toward the watches of G-sport Ltd. To identify the USP G-sport Ltd need to understand what the customer want from them, rank their competition and defend their USP so that the competitors cannot copy these. When G-sport Ltd positioned themselves properly and the have convinced their target market segment why they should buy from them.(McKeever, 2016)


From this report we have come to a conclusion that the company G-sport Ltd need to keep all the external factors which can affect their market in the short medium and long term. The company need to be updated with the competition they are facing and how they can target their customer in order for them to purchase the watch from them and no their customers. Comprehensively if the company keeps in mind about all the factors there are good prospect for them in the future.

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