E-Commerce Business Strategies for Top-End Farming - Case Study Example

E-COMMERCE BUSINESS PLAN FOR TOP END FARMING Student’s Name Professor Course Date E-commerce Business Plan For Top-End Farming (continuation) One of the biggest challenges facing many e-businesses is competition. Because of the stiff competition, many businesses have laid various competitive strategies to ensure they remain competitive in their markets. According to Hoffman (2000), one important factor that enables a business to remain competitive is effective decision making, as it results to positive results. For any business to compete equally with its rivals, it must have sound decisions that ensure effective competitive arrangement. As Autio, Yli – Renko and Sapienza (2002) explains, competitive strategy is the framework followed by a business to ensure it has effective competitive positioning. Using competitive strategy approach, Top-End Farming aims to build a sustainable competitive advantage over its rivals. According to Coplin (2002), many business strive to achieve a competitive advantage over its rivals, but very few achieve it because either they do not understand what it is, how to achieve or how to maintain it. Aaker (1989) argues that a competitive advantage can be achieved by providing better value than the competitors, such as offering quality goods and services at affordable prices. Among all the strategies of achieving competitive advantage, the strongest strategy is the one, which cannot be copied by the competitive rival, as it makes a business stand out unique. Therefore, Top-End Farming aims to use competitive strategy approach to achieve competitive advantage over it s rivals by establishing strategies that are unique from its rival companies in the few available markets. In order to come out and outdo its rivals in the available markets, Top-End Farming will utilize the following competitive strategies: People Differentiation According to Aaker (1989), people differentiation is one of the best strategies that enable a business achieve a competitive advantage over its rivals. Researchers argue that many companies fail to notice their employees when striving to achieve competitive advantage, but in fact, they form an essential element that can be effectively utilized in achieving a sustainable competitive advantage. According to Kelleher and Sarah (1999), people differentiation is one of the best competitive strategies, as the rival companies cannot replicate it easily. This is because it is an eternal element and hence not accessible by the rival companies. Therefore, Top-End Farming aims to give more considerations to people differentiation to achieve a competitive advantage over its rivals. Top-End Farming will pay attention to its employees through monitoring their job performance and commitment. Hoffman (2000) argues that employees who are constantly monitored are able to carry out their duties effectively and hence offer quality services to the company’s customers. Top-End Farming will ensure that its employees are constantly trained after every three months to generate an enhanced quality product compared to other companies offering the same products. This strategy has been chosen because the customers will be dealing directly with the employees in charge of selling the agricultural products. According to Hoffman (2000), people differentiation is highly effective in achieving a competitive advantage when consumers deal directly with a company’s employees. Researchers point out that employees form the most important element of a company can be utilized in enhancing customers’ satisfaction. Top-End Farming employees will receive training on how to offer quality services to the customers, such as helping them choose the appropriate fertilizers and seeds and how to locate them in the warehouse. A customer advised on the appropriate product to purchase and is even assisted in locating the product will return several times and spread the positive message to other farmers, hence attract more customers. The training will also focus on enhancing employees ethics such as courtesy, patience and humility, among many others to ensure they treat customers in a highly professional manner hence retaining them and even attracting more. Top-End Farming will also ensure that its CEO is a well-known and charismatic figure, who will create a good name for the company and hence attract customers. The company will use its website to publicize its CEO to ensure he is well known among many people, both at the local and national level Service Differentiation Top-End farming will differentiate its services that will accompany the physical products it is offering its customers. According to Porter (1985), service differentiation is one of the best competitive strategies that might enable even small businesses to outdo big, established businesses in the market. Many of the big Agriculture–based businesses in Australia mainly focus on coming up with new products as a way of attracting customers. Many of them sell in wholesale scales and hence have no time to offer any additional services to their larger number of customers. Therefore, Top-End Farming aims to utilize this opportunity to ensure its few customers are offered the best services in accompaniment to the products offered. Top-End Farming aims to employ two consultants, who will be responsible for ensuring customers receive the best services. One of the additional services that will be offered to Top-End Farming customers is instructional training on how to use various agricultural products, such as fertilizers and seeds. Customers purchasing various products from Top-End Farming will undergo a 30-45 instructional training session on how to use the products purchased. This way, Top-End Farming aims to attract more customers and retain them hence emerge more competitive than its rivals. Image Differentiation Because Top-End Framing is offering products similar to its rivals, another strategy that will be used in ensuring it remains competitive is image differentiation. As Porter (1985) argues, when competing companies are offering similar products, customers might see a distinction through a company’s name or its brand name. This underpins the importance of companies to establish good co-operate images, which are able to distinguish them from their rivals. However, Gaines-Ross and Chris (1999) argue that a reputable brand name is very difficult to build. A single mistake done within one day can destroy a brand name built over years. Top-End Farming will ensure that everything it does is focused towards building a well-regarded image, both at the local and national level. One effective strategy that will be used in creating a good image at the local level is giving back to the local farmers. Top-End Farming will arrange for a public show that will be held twice per year to celebrate the best performing farmers in the region by rewarding free agricultural products. At the national level, Top-End Farming aims to give out some donations in form of fertilizers, seeds and other agricultural items, such as wheelbarrows, to poor farmers in other regions. This way, the brand name for Top-End farming will have a high reputation both at the local and national level. Top-End Farming will also create a story for its products that will help be identifiable and unique from its competitors. The story will be based on a local farmer, who can educate all his children on income generated from sustainable agricultural activities, such as application of green fertilizers and use of aboriginal seeds offered by Top-End Farming. This story will be used to advertise the company’s products through media and will be posted on the company’s website. This will create a reputable brand name for the business, as some farmers will purchase the products offered due to the publicity created by the story. The Domain Name for Top-End Farming The preferred domain name for Top-End Farming is ‘topendfarming.com.au’. Various factors were considered when choosing this domain name. First, the domain name represents the website name and hence the business name. This way, the domain name will help in marketing the business. According to Charlesworth (2003), having a website, which is named after the domain name is highly important, as it helps people think of the website by its name. Another reason for choosing the business’s name for its domain name is that the ‘farming’ name will help market the products sold by the business. From the word farming, many farmers who are the targeted customers will be interested in logging into the website to view its content. Having a domain name with a ‘.au’ at the end will show that the business is dedicated in satisfying the demands from customers mainly based in Australia. According to Heng (2010), in choosing the domain name, abbreviations were not used because they are difficult to remember. Therefore, the business’s full name was preferred, as it is easy to remember. No hyphenation was used, as it makes the domain name complex. A domain name with hyphens is also difficult to explain to another customer, especially over the phone. Therefore, hyphens were eliminated to make the domain name simple and hence simple to be used by the business’s customers. Website Hosting Option for Top-End Farming Depending on the requirements for Top-End Farming, the firm will use Internet Service Provider (ISP) for hosting its website. According to Kyrnin (2012), an ISP for web hosting is a peripheral solution, whereby the ISP is in charge of providing a business with connection to the Internet. Among all the ISP types of hosting services, Top-End Farming will use a shared server whereby the server will be owned and located in the ISP offices. Just as its name suggests, a number of other websites will use the server collectively. There are various reasons why this server is the most applicable for Top-End Farming for now. Top-End Farming is a new business, which is not well established compared to its rivals. Therefore, having a server that is economical will enable the business reduce the cost involved. Despite the fact the server is shared by numerous websites, Top-End Farming will ensure that the shared web hosting service is purchased from a reputed hosting company to ensure that performance issues are not compromised. According to Kyrnin (2012), well established companies providing shared servers ensure they are operated and maintained by qualified and highly trained IT professionals to retain its customers. Top-End Farming aims to minimize cost as much as possible to offer quality products at an affordable price in order to compete equally or even better with its rivals. Therefore, a shared server being the most economical is the best choice for this business. Because the server is shared by other numerous websites, it is cheap because the cost is also shared. From current statistics, a joint server costs from $4 to $10 dollars each month depending on the features requested. This cost range is feasible with Top-End Farming budget. Another factor that makes a shared server the best option for Top-End Farming is the web space allocated to a single website. Statistics show that currently, a single website can obtain a web space as large as 1000MB to 40GB. Currently, this range of a web space is highly feasible with the web requirements of Top-End Farming. According to Kyrnin (2012), competition among the many ISP companies has led to great offerings to the consumers. Many companies have evolved technical features that easily meet the various requirements of small businesses. Therefore, Top-End Farming being one of these small businesses will have all its website requirements met promptly and without any limitations. By having a shared server, Top-End Farming will have a control panel for managing its website. This means that the business will have the opportunity to eliminate or upload web pages and check its website information just as is the case with self-hosting. The shared server despite being cheap will enable the company to generate explicit domain email accounts. Another feature of shared server that makes it highly feasible with Top-End Farming is the fact that many ISP companies offer the capacity to put in more resources in the web space at cheap cost in case the initial allocated web space seems limited. Top-End Farming is a growing company and hence soon will find its allocated web space becoming small to accommodate its database. Therefore, having a shared server will enable it expand its web space at a reduced cost. However, as Kyrnin (2012) points out, despite having various benefits, a shared server has some limitations. One of the biggest disadvantages of a shared server is that a business ISP may become blacklisted because of illegal actions by other sites hosted by the shared server. In such cases, a business stand to lose a lot in terms of loss of customers and cost incurred in ensuring that the website is removed from the blacklist. Reference List Aaker, D 1989, Managing assets and Skills: the key to a sustainable competitive Advantage. California Management Review, vol. 31, no. 2, pp. 91-106. Autio, E., Yli – Renko, H & Sapienza, H. J 2002, Social Capital, Knowledge Acquisition and Competitive Advantage in Technology –Based Young Firms. Strategic Management Journal, Special Issue on Entrepreneurial Strategies and Wealth Creation in the 21st Century. Charlesworth, A 2003, Choosing a Domain Name. International Journal of e-Business Strategy Management, pp. 327-334. Coplin, L. H 2002, Competitive Advantages and the SMEs: The role of Distinctive Competences as Determinants of Success, PhD Thesis, Universitat Autononma De Barcelona. Gaines-Ross, L & Chris, K 1999, "The Brand Name CEO." Across the Board vol. 36, no. 6, p. 269. Heng, C 2010, Tips on Choosing a Good Domain Name: Considerations you should be aware of when registering your domain. Available at: http://www.thesitewizard.com/archive/domainname.shtml. Hoffman, N.P 2000, An Examination of the Sustainable Competitive Advantage Concept: Past, Present, Future. Academy of Marketing Science Review, vol. 4. Kelleher, H & Sarah, R 1999, "How Herb Keeps Southwest Hopping," Money, vol. 28, p. 612. Kyrnin, J 2012, Before You Choose a Web Hosting Service, Available at: http://webdesign.about.com/od/webhosting/bb/aabhosting.htm. Porter, M. E 1985, Competitive Advantage; Creating and Sustaining Superior Performance. New York: The Free Press. Read More