Question 1
A business model can be described as the activities and the arrangements that are used by the businesses to know the value of their products, how to make the value known to the customers, and the arrangements that will be used to know to obtain the revenues and cater for costs of the business (Bonakdar, Gassmann, & Fleisch, 2015. The three business models for the buy now pay late will be discussed in this study.
Value creation
The payment mode that entails the customers to buy the product now and pay later will be of great value to the type of customers that can afford the product, but their current income doesn’t allow them to buy the product. The customers will be able to purchase the product and pay later with some form of fees that would be considered profitable. The company could try to focus the business on the markets that have only have their payment once a month and did not have the kind of money that is needed currently.
Value configuration
The organization can have their activities linked from the top chain of the products or services developments that can accommodate the late payment from the end customers. The organization can agree with the retailers or the leading sellers in the market about how the late payment can be compensated through some sorts of interest or commission to maintain a good relationship of the chain. This will be beneficial to the wholesalers and the sellers since the trust created will make the leading wholesaler make the products or services with more quality that will lead to the customers being even more loyal than before.
Value capture
The significant outcome of such a result is that the after-pay mode will not just create more revenues to the company. Still, the company stakeholders will benefit from the fees on late payment as added gains. This provided a way for the company to reduce its operations costs by taking the credits when the customers exceed their late payment deadlines. They have already communicated the issues to the leading wholesalers or the people behind them in the chain of product creation. The savings will occur as the organization generates revenues.
The strategy is suitable since it addresses the gap that was there before in the market since there were many companies before that couldn’t even cater to the people that could afford the late payment mode. The organization could not have its stakeholders on board for this type of strategy, but through the time when the plan is a success, they will be fully on board. The success of the system will give the stakeholders a margin of profits. The stakeholders will be ready to even invest in the strategy to generate more revenues.
Question 2
Bunning is one of the warehouses that is owned by the Wesfarmers in Australia. The warehouse has a market share of about 50% in Australia, accredited to more than $13 billion in sales each year. This has been through its diverse and implicit activities by the Wesfarmers. The second retail store is the Office work, which is the leading company in the retail and warehouse business; it has a market share of 12%. The competition between Bunning and Office work has been so intense, with Office work having a total revenue of $ 2787 million, increasing about 20.4% from in 2020. The third warehouse that is owned by Wesfarmers is Kmart groups, which has a market share of 45% in the department of storage in Australia. The Kmart groups consist of three other companies that include Target, Kmart, and Catch. The company has increased by about 7.2% in its total revenues to $9.2 billion in 2020 compared to 2019.
corporate headquarters for its divisions
The parent corporate will have the ability to have financial control, legal and strategic planning over the divisions. The parent corporate will be viable for controlling, evaluating, and monitoring the other business units involved in the company’s portfolio. The manager and other head of the departments of the business units are given total power and authority to make the decision at their levels, but they must always be reporting to the top levels for control and performance evaluation.
Divisional Headquarters for its SBUs
The roles of the divisional headquarter for the SBUs include setting standards for market penetration and consolidation, and product developments. There is a full practice that will allow the SBU to be able to make the decisions that will be able to make the corporate parenting company to be able to grow in its revenues and size of the market. The realization of the company’s goals will depend on the kind of strategies that the division headquarters will allow the SBUs to make regarding the market segments and the type of products that the company will be able to sell to different markets.
The creation of value to the organization by the headquarter can be done through several strategies. For instance, through envisioning, top management can create policies that will make the other divisions prepare for the unforeseen moment in the business environment. Through the coaching of its staff to enhance their managerial skills to be the key to understanding the market and the needs of the organization in leading the other employees well. The other thing that the headquarter can do to enhance the value of the organization is to provide the resources in terms of finances and human resources that the other departments and divisions would need to make the organization soar to great heights. The intervening of the headquarters in the administrative processes such as controlling, evaluation, and monitoring of the lower divisions will create a value of to the organization because this will create the accountability principle of the employees.
Question 3
Driver/motive for the merger
Value creation the merging of the companies will mean that the two will be able or have more value than before for the firms. This will mean the wealth or the returns of the stakeholders will be increases in size. This can be through the economies of scale that reduce the costs of production.
The merging will ensure that there will be diversification in the two firms. Either TPG or Vodafone will be able to enter another one’s market and see new opportunities that the firms can take advantage of.
Acquisition of assets that would not be possible if the firm decides to go on a solo basis on that venture. There are some assets that are very difficult to acquire due to time or financial limitations. The merging of the two companies will mean that it will be easy to obtain such kinds of assets, e.g., technological innovations.
Increase in financial capacity through the merger. Many companies may face some financial constraints in terms of debts or equity, but with the merger, it means that the two companies will be able to benefit from each; hence the business development operations will be running smoothly.
Benefits of the merger
The company that will be having a low market share will be able to have its market share increase through the merger and the activities of the merger, which will make the company move ahead in the competitive market.
The cots of operations will be able to be reduced, given that the companies will be working towards the same objectives, and the operations will be in a similar way, e.g., advertising.
The firms will be able to expand on its operations by entering new geographical locations that were inaccessible before.
Challenges in the merger
Difficulty in maintaining momentum – the main issue that will come after the merger is that the firms will have problems maintaining the momentum of their business, given that all attention has been given to the integration of the business activities.
The engagement of the employees- The two companies will be having the difficulties in making sure that the employees settle in together since there will be a bit of difficulty for the employees to corporate in terms of the integration of the two companies’ objectives and strategies.
Challenges in technological integration- given that one company might be bigger and operating on a recent customized technological system and the other an older one and operating on a legacy foundational technical system, there might be a problem making sure that the two are inlined with one another technologically.
Customer engagement- It is crucial for the companies to involve their customers and the stakeholders when there will be a merger between to avoid any unnecessary challenges and surprises by the customers when they start seeing some new changes such as the receipt names.