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Write 8 pages with APA style on Strategic Management Analysis of DeBeers. DeBeers provides employment to more than 23000 employees worldwide and the main objective of the company is to make high-quali
Write 8 pages with APA style on Strategic Management Analysis of DeBeers. DeBeers provides employment to more than 23000 employees worldwide and the main objective of the company is to make high-quality diamonds and make a lasting contribution to the community (DeBeers, 2013h). The company has two major shareholders Anglo American with 85 percent holding and Government of the Republic of Botswana with 15 percent holding (DeBeers, 2013k). The DeBeers group of companies constitute of wholly-owned subsidiaries, investment, and partnerships in diamond making. The major tasks of DeBeers include exploration of diamonds and mining activities in three major diamond producing countries like Botswana, Namibia, and South Africa. The company also specializes in sorting, valuation, and sale of rough diamonds and the development of synthetic diamonds for major industrial applications (DeBeers, 2013e). . The business environment analysis also helps the company in adopting a particular marketing environment and also the way it responds to certain environmental circumstances (Shaikh, 2010). Porter’s Five Forces Model will be a significant macro environment analysis which will help in understanding the impact of the external and internal forces in a direct and indirect manner. Bargaining Power of Buyers: Diamond is regarded as one of the most precious and valuable jewelry items in the UK and is also the most coveted jewelry in the world. As per a survey conducted by the Bain and Company, it was analyzed that diamond was the most coveted jewelry among women in the UK in the year 2008 (Bain and Company, 2011). In the same survey conducted in the year 2008, it was also observed that that at least 65 percent of the UK household owned at least one diamond jewelry in the household (Bain and Company, 2011). This reflects that in spite of the recession in the UK the common people preferred investing in valuable jewelry like a diamond and also regard it as a valuable gifting item. Since diamond is one of the most valuable and requires extensive maintenance, the price of the diamond is quite high and seldom there is any bargaining while purchasing the product. The bargaining power of the buyers is not very high in this industry. Bargaining Power of Suppliers: The supplier forms an integral part in the diamond industry because they helped the diamond companies in 2008 to maintain timely delivery of the jewelry for industrial and consumer applications. The suppliers are responsible for the supply of crude diamond to the warehouses for cutting purposes and also for the supply of the polished diamond in the retail shops. The bargaining power of suppliers in this industry is high. The threat of Substitutes: Although, compared to the other jewelry items diamond is regarded as one of the most valuable items in the world jewelry items like platinum and silver cannot be the replacement for diamond. However, preference is given to diamonds and the threat of substitutes was very low in the industry. Due to the recession, the jewelry industry witnessed an increase in the sales of the imitation and silver goods during the tenure 2008 to 2009 because people preferred buying jewelry items at affordable prices. .As mentioned before that diamond is one of the most precious items which have been the most coveted jewelry item among the customer since ages. .There is no question of its importance to come down because customers will not prefer silver, gold or imitation to the diamond. .
