Profiling The Business Of Victoria Plc Commerce Essay Example

division led to a 62% increase in sales, offsetting the decline in domestic sales to the residential market. Strategic appointments were also made in both the UK Export division and Irish operation to establish a foundation for future growth and profitability. Similarly, appointing a Vice President Finance and General Manager to the Canadian joint venture will further strengthen that business. Lowering the corporation's tax rate from 30% to 28% aims to support companies like Victoria plc during the recession and safeguard jobs; however, due to ongoing economic downturn, this measure has had limited success thus far. According to Victoria's annual report in 2009, while the rug market in the UK experienced a decline of over 20%, Victoria's carpet sales only decreased by 9.2% (?22.57m). The flooring market in the UK has been influenced by healthy GDP growth within the country.

Source: Adapted from provided informationDespite challenging economic conditions, Victoria believes it has gained market share through its high-quality products, service, and employees. However, due to the financial crisis, housing market collapse, and global recession impacting consumer spending, Victoria's carpet sales in the UK residential market have declined by 17.5%. In Australia, there is a demand for man-made narrations in rugs which has contributed to the company's growth. Although there was a decrease in net profit before tax in the fiscal year, all Group companies achieved a pre-tax profit and remain cash generative. The company is confident that as the economy improves, they will benefit from their brand. UK exporters welcome a weaker pound as it makes their goods cheaper in foreign markets.

From a social analysis perspective, people play an important role both as producers and consumers

of goods and services. It is crucial for companies like Victoria plc to give back to society and maintain strong connections with local communities where they operate. Victoria is actively involved in supporting employees with their fundraising efforts for charities and organizations within the community. One of their major initiatives is organizing a charity golf tournament specifically for the rug trade industry in the UK.In addition to this, Victoria sponsors a local cricket cluband offers work experience opportunities to students in the area.Victoria encourages employee contributions through its "Give as You Earn scheme," allowing regular donations to be made to registered charities through payroll deductions. Last year's successful golf tournament raised ?21,000, which was then divided between the Furnishing Trades Benevolent Fund and Macmillan Cancer Relief. The introduction of new technologies has greatly impacted various industries, enhancing quality, reducing costs, and saving time. This fosters innovation within the industrial environment. Victoria recognizes the importance of embracing these advancements and has installed video and telephone conferencing systems in all offices to save time on travel requirements. The internet and television platforms serve as effective means for customer interaction and information provision, saving time and money while providing access to high-quality content. These installations benefit both customers seeking information or engagement opportunities, as well as organizations offering products or services. Additionally, Victoria incorporates innovation into engineering and machinery practices to enhance capacity, capabilities, product design, quality assurance, and completion. Companies find implementing innovative ideas advantageous as people embrace change and prefer constantly evolving things.Integrating new ideas is crucial for companies to meet customer needs and demands. In the rug spinning sector of the UK, where Victoria operates,

the introduction of thermal splice technology has improved quality in its tufting division. This has resulted in increased manufacturing efficiency and decreased production costs for tufted rugs. The rug manufacturing industry that Victoria operates in is influenced by various factors in environmental analysis, including laws that regulate toxins with persistence, toxicity, and a tendency to accumulate in living organisms due to their potential harm. Once these substances infiltrate the environment or impact animals and humans, they are difficult to eliminate. As part of their commitment to environmental conservation, Victoria produces biodegradable products with low toxicity levels that comply with strict standards set by environmental organizations. These products cater specifically to individuals with concerns about chemical sensitivity.

Furthermore, Victoria takes great care in selecting vehicles and machinery used at its fabricating unit to ensure efficiency and eco-friendliness. The goal is to reduce air and noise pollution by conducting regular maintenance and servicing for smooth transportation of full loads from the manufacturing unit. Additionally, Victoria is committed to reducing wastage by sending waste for recycling to a government-certified company.Furthermore, Victoria has its own water recycling plant for efficient water reuse. The legal analysis of the fabric manufacturing industry is of significant importance as governments establish the legal framework within which companies operate. This framework includes areas such as health and safety, employment, and monopolies. In recent years, there have been substantial legal changes that have impacted businesses in the UK fabric manufacturing industry. Victoria plc, along with The Carpet Foundation and other manufacturers and retailers across the UK, leads a Health & Safety Forum that meets regularly to share management initiatives and best practices. Operating within a legal

framework is crucial for businesses as it greatly influences various aspects of their existence, including their organizational standing. The legal environment not only restricts and regulates a company's operations but also allows it to pursue its goals, especially profit attainment through entrepreneurial activity (Lan and Worthington, 2006). In the rug industry, practices are self-regulated. The Carpet Foundation has an approved code of practice by the Office of Fair Trading which governs marketing issues such as warranties, order cancellations, dispute resolution through conciliation and arbitration. Quality regulation is done by using a Quality Mark based on British Standard product tests from www.keynote.co.uk.Baines and Fill (2008) suggest that industry attractiveness and overall profitability for different companies within the industry are determined by various factors. According to Porter (1980), competition in an industry is not random but rather rooted in economic structure, extending beyond current competitors. The intensity of competition depends on five competitive forces: threat of new entry, supplier power, buyer power, threat of substitute products, and competitive rivalry. Understanding these forces helps organizations develop strategies for market success (Thurlby, 1998). Industry profitability also depends on the price-to-performance ratios of substitute products or services that meet the same demand (Section 3.1). When selecting a type of flooring, examples such as laminate flooring, engineered wood, solid wood, cork flooring, and tile flooring in Victoria can be considered as substitute products for traditional flooring options. The threat of substitution is influenced by factors like switching costs incurred by customers when they switch to a different product or service. When discussing the threat posed by new entrants (Section 3.2), both barriers to entry and the reaction from existing competitors determine

how many new firms enter an industry. Barriers to entry take various forms to prevent excessive competition when profits exceed zero after accounting for capital costs.On the contrary, if a company lacks financial stability to challenge the current market leader, entering the market can be difficult. In such cases, companies must be prepared for high marketing and advertising costs as substantial investments may be needed for marketing or equipment. When faced with a new competitor, existing companies often respond by cutting prices aggressively. The UK rug industry faces tough competition from textile industries in India, Bangladesh, and China due to higher manufacturing costs compared to other countries. If UK entrepreneurs do not adapt, buyers may opt to purchase textile products from these countries instead. Competitive challengers target the same customers with similar products and services.

Kipenberger (1998) suggests distinguishing potential buyer power based on their willingness to use it which is influenced by perceived risk of failure. Buyers have bargaining power as they possess knowledge of market prices. High prices set by providers significantly impact sales volumes and overall revenue in markets with only a few major participants. Strong customers have the ability to exert pressure on providers, forcing them to lower costs or improve product quality. Victoria's main customer base includes residential markets, high-value sectors, government establishments, and major retail groups. John Lewis Partnership is Victoria's largest client for rugs.
Victoria actively focuses on establishing long-term relationships with clients and positioning itself as their preferred supplier. Additionally, the company strives to provide added value and exceptional levels of service. In both 2006 and 2007, Victoria carpets were acknowledged as the provider of the year for their

outstanding product. In the rug industry, suppliers in sourcing essential materials from different locations within the country hold significant influence. Suppliers and workers have the power to demand higher prices or decline work based on factors like economic recession or instability. Labor unions also possess enough power to bring about changes such as job cuts and layoffs, further strengthening suppliers' positions. Moreover, agencies charge higher commissions when procuring goods for companies while employee salary packages also contribute to supplier bargaining power in addition to price discrepancies in quotes from suppliers.

Stakeholder analysis plays a vital role in developing an organization's strategy by identifying individuals or groups who can impact or be affected by its achievements. Internal stakeholders such as employees, directors, managers, trade unions, and shareholders (Friedman and Miles, 2006), along with external stakeholders like suppliers, customers, competitors investors governmental bodies ,and general public all significantly influence or are influenced by the organization in various ways.According to Capon and Claire (2004), stakeholders have diverse roles and varying interests in managing an organization, which can sometimes create conflicts. For example, employees may desire higher rewards and wages, while clients prefer lower prices and costs. However, reconciling both can be difficult if labor costs are high. Additionally, stakeholders differ in their power and involvement levels in the organization's strategies.

Victoria acknowledges the importance of its employees and is dedicated to promoting equality by implementing employment policies that foster a family-friendly environment. Corporate social responsibility (CSR) often relates to the concept of 'enlightened self-interest', which centers around how organizations plan for and manage their connections with key stakeholders. CSR encompasses an organization's obligations toward its societies and stakeholders (Tench &

Ralph 2006). Victoria is committed to fulfilling its social and environmental responsibilities without adversely impacting the local community. The company complies with laws, regulations, and standards for environmental protection, working conditions, and child labor.

By analyzing their internal operations, businesses can develop effective environmental management systems that minimize liabilities and risks while maximizing profits through resource efficiency. This appeals to informed consumers who are willing to pay higher prices.Victoria's manager regularly convenes meetings with major stakeholders and partners to address issues and seek guidance. Furthermore, an annual meeting is scheduled for minor stakeholders. Collaborating with trade unions and organizations enables managers to acquire knowledge, exchange experiences, and accomplish more collectively than individually. Failing to engage stakeholders may raise doubts about the company's dedication. The directors of Victoria themselves are stakeholders who oversee the organization. Employees depend on Victoria for job security and benefits as primary stakeholders concerned about their livelihoods. Stockholders exhibit a strong interest in both profitability and overall business management since they are the company's owners. According to Victoria plc's public presentation chart, there has been a consistent upward trend over three years indicating the company's financial strength. The previous year's performance chart appendix for Victoria plc can be accessed by clicking on this link: [hypertext transfer protocol: //markets.ft.com/ft/tearsheets/performance.asp?s=UK: VCP].