Sample Essay

  • Social/Demographic/Cultural factors: This is lost revenue to the automotive retail firms.  The repair and maintenance outlets in UK have reduced by 5500 in number since 2004. Service Demands are of prime importance since customers want quality service, clear communication of the related products and cost effective prices.

Now these factors help automotive retailers to achieve competitive advantages and price variations are no more the sole factor for competitive advantage. Customer Relationship Management is essential to have for every retailer since customers demand personal and excellent service. Customers are now more sophisticated and educated so they want a luxurious, comfortable and an outstanding environment plus interior of the retail outlets. They also want sophistication in the way deals are made to sell cars so new strategies like ‘build to order,’ ‘configure to order’ etc have to be adopted by the retailers in order to be competitive.

  • Technology and Innovation factors: The Information and Communication   technology (ICT) has advanced a lot in the last few years and the IT is an essential part of every business. Automotive retailers are now incorporating SAP in their business for a more efficient run business. Knowledge management (KM) has also gained popularity and is widely used in businesses. Enterprise Resource Planning is being widely used by businesses for a well monitored and integrated workflow system. SAP is the best and most widely used ERP presently. The former innovations are also being used by retailers to benefit their business and gain competitive advantages by gaining economies of scale. There have been further innovations like value-added packaging, customer oriented deals, extended warranties etc and these help make loyal customers which in turn helps increase market share and profits (Murphy, K., 1999).

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