Although HOC is an ethical company, they would also have rivalry from chocolate companies do not focus on ethics, this is because of recession people need to save money, therefore chocolate that isn’t particularly ethical are cheaper to buy and therefore attractive to customer. I High I Power of Buyers * The company’s marketing capability and use of IT in developing the company’s website has enabled it to track and quickly spot trends in changes to consumer buying patterns. Therefore this shows that the company focuses on what the buyers are looking for and plan to change to suit the buyer. I High I Power of Supplier’s is a complicated factor as it isn’t an ordinary relationship a company would have with suppliers, as the suppliers depend on HOC to grow and manage their crops however HOC also rely on the suppliers to gain their ingredients.
I Medium I Threat of Substitutes * Threats of substitutes are quite low because although there are other substitutes such as crisps and sweets, there is not really an exact substitute, for example in forms of transport such as trains could have a substitute such as a bus, it does exactly the same think, Just in a different way, however in my opinion there isn’t such thing in relation to chocolate. I Low I Threat of Entertainments is a threat of new entrants as fine chocolate is becoming more popular as its being associated with fine wine and cheese etc. Therefore there is a higher demand for chocolate. However this is not a high risk for HOC as it would be quite difficult for a new entrant to come into the market and differentiate themselves from other companies. I Medium I The main forces that are at work in the competitive environment are competitive rivalry and the power of the buyers.
Firstly competitive rivalry because now there are ore and more chocolate companies that are looking into being more ethical, such as galaxy who are not classed as fine chocolate but are classed as an ethical company. Galaxy therefore, is giving customers an ethical aspect without delivering the expensive price. The power of buyers is also a huge force that affects HOC. This is because HOC look out for the customer buying patterns and change their products to make suit. The underlying forces in the macro-environment would be technology and environment. Firstly technology would be the factor concerning the customer buying rower because HOC use their website and marketing capabilities to quickly spot new customer trends which helps them to quickly change anything they need to.
The environmental force could affect the competitive environment because without all the help and support they are giving to the local farmers to manage and grow their crops and also by buying the coco off of them, it would cause the whole ethical strategy to HOC to be completely Rene it’s not likely that these tortes will change as these are factors of the company that are most recent and can only really move forward. Technology is almost a certainty to move forward as with ethical as no one would want to step back in helping people. So these forces would always be here however it may mean HOC need to progress along with these forces to stay up in the competition. A huge competitor for HOC would be galaxy as this also shows a big involvement with ethics by being involved in the rainforest’s alliance.
However Galaxy approaches technology different, even though galaxy has its own website, it does not use their website to sell its product as HOC does because you can’t but their products inline, therefore it shows that galaxy are not really using their resources to full capacity. However on the other hand it could be argued that HOC is relying on the internet and their website to sell their products with 70% of their products being sold that way. Whereas galaxy focuses on selling their products in stores and by advertising on TV. To be even more successful HOC should dedicate more time to advertising their products and possibly getting a rage out to suit supermarkets. Even thought they have an award winning website they should also keep up to equate with trends such as Backbone.