Uber Company operates at an arguable reasonable cost across all the states and countries where the company has branches and the company is always committed to providing quality services to its customers. With the growing level of technology, the company can now reach its customers from different parts of the world through the use of smart phones provided that their app is installed. In order to stand the test of this competitive market, Uber has partnered with other companies and opened branches in other parts of the world. The branch which is about to be opened in China is yet another plan of beating competitors and it is likely to succeed considering that the company has good strategies in place and they are the same strategies which enabled it to succeed in the United States of America where competition was even tougher.
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Business is a very competitive endeavor which needs consistency and determination for an organization to succeed. Since the ultimate goal of any business organization is to make profits, an organization should always be mindful of possible threats which might prevent it from achieving this aim and carefully work on it. Uber-Company is no exceptional (Grosse, 2010, p.12). This task, therefore, seeks to discuss a new branch which Uber Company wishes to start in Mumbai. It will further analyze the main challenges the company is likely to encounter considering that it is opening a new branch in a country which also has some other existing companies offering similar services.
Uber is a company with its headquarters in San Francisco, California. It is a transportation network company which has been in existence since the year 2009. Currently, it accepts the submission of trip requests made by smartphones. The service is reportedly expanding at an alarming rate and as at now it has reached 66 countries in the whole world. In fact, Uber-Company has grown faster than EBay Company, which was initially believed to be doing so well. Among the factors which have accelerated its growth is the availability of restaurants and nightlife, the holidays and events which it organizes, weather and sports among others (Grosse, 2010, p.31). Some of Uber Company’s main competitors are Lyft Company, which was started in the year 2012, and it is available in 60 states in the United States of America. Another competitor is Curb, which also operates in over 60 states and partners with some 90 cab companies. The company is currently driving 35,000 cars and is based in Alexandria, Virginia. The third competitor is Didi Kuaidi, which is located in China and is estimated to have an equity funding of 4.42 billion US dollars from all its 14 investors. Another competitor is Grab, which is based in Southeast Malaysia and has around 75,000 registered taxi drivers. Its total equity funding is estimated at 680 million US dollars. (Ginn, 2013, p.47). Opening a branch in China is, therefore, likely to be a bit challenging considering the competition that it is liable to face both within China and outside China.
Uber-Company is determined to bring better transit, the opportunity to masses. This will be a remedy to all who are not contented with the services they have been getting in the transport sector and an antidote to all problems associated with carriage in all areas of their operation. Their customers are key partners here because without the customers there will not be any transaction. The company intends to rise beyond the narrow confines of operating within China to operating worldwide since its establishment. To actualize this, Uber company is open to any emerging idea as far as innovation is concerned and with the rising use of social media, it has become a vital source of new ideas from all parts of the world (Hauser and Shugan, 2009, p.17). Company’s resources
The company gets an arguably good income from its partners and due to the good management and friendly terms and conditions, the company has been increasingly partnering with other organizations from across the globe. Among them is ECPAT, which is considered a leading policy organization based in the United States of America and is concerned with putting to an end the sexual exploitation of the minors through conducting several seminars to sensitize people, legislation among others. They are also keen on stopping the trafficking of children which they consider very inhuman (Ginn, 2013, p.65). Uber-Company has also partnered with China, and this has enabled traveling to become very accessible in the whole world since the Chinese can now book flights through Uber or Alipay app and this is in all cities that have Uber operating in. Nevertheless, Uber has partnered with Arianna Huffington, who is considered as a very successful entrepreneur. She has contributed so much to where Uber-Company is as per now and the company usually acknowledges her input. Among the skills that Uber Company’s employees possess that have significantly contributed to its success are commercial awareness and the employees here having vast knowledge about how the industry operates. Besides, communication is also another factor which has enabled Uber-Company to make great strides is communication. Communication has always been excellent within the company’s premises and outside the enterprise (Newhouse, 2008, p.43).
The company has its website where the clients can obtain information regarding their services. This makes it very easy for the clients to access information concerning the products and the services. With the increasing use of the social media, accessing information has been made easier since the company can now post its services on the social media. This is to the advantage of clients because they can post their feedback which is also very useful to the company in improving service delivery.
The supply chain
The supply chain here is very straightforward and helpful as there are apps which play a very significant role in connecting the drivers to the riders. This makes cities in which they operate very accessible (Jonker and Nijhof, 2006, p.83). The cities have indeed been made closer through the use of the app and Uber-Company has benefited from this system of supply chain since it has received more customers. In connection with the new company which Uber intends to start in China, the supply chain will not be any different considering that the app is already existing in China and several countries in Asia. This will rather make traveling easier considering that Uber-Company will be introducing the use of an app in transport- which will go down well with the natives thinking that it is in China where the use of technology has flourished, and most citizens have no problem with operating electronics.
Porters five Model
In the light if Porter’s five forces model, it might take Uber-Company a little more time to stabilize in Mumbai because the natives usually tend to fear a new entry because no one can justify its services. This is further made more difficult because other similar companies are existing in China such as Didi Kuaidi and therefore convincing people to like a company which is just coming in becomes severe (Evans et al, 2013, p.29). Apart from the threat of new entry, there is another factor which is likely to disturb the stability of Uber-Company in its new location, and that is the competitive rivalry. Didi Kuaidi Company is liable to impose stiff competition on Uber-Company considering that it is also a company which is already established in the area and it already knows the market trend in the region since it has been in existence for quite a long time. Competition is a factor which cannot be assumed because it is among the key contributors to a business’ failure. Uber-Company must, therefore, have a well-defined plan to counter the next competition because Didi Kuaidi will fighting back to retain its customers as well as winning more customers.
Concerning the buyers power, Uber-Company would be looking forward to getting the good number of clients it takes in the United States of America, but this will have to wait considering that selling a new company’s ideas in a foreign country is not an easy task. Besides, the natives already have several options which they have several reasons for trusting. It, therefore, takes endurance before Uber-Company eventually begins getting many buyers. With emerging trends, Uber may use social media to reach out to its prospective buyers with ease and very first. Also, there is a threat of substitution and considering that Uber-Company is opening a new branch in China, it is a big reason to worry the company. The customers may choose to use Didi Kuaidi or any other local company instead of Uber, and this will weaken it. A company can only be stable when there is a constant flow of customers as they are the primary stakeholders involved in any business (Bennett et al. 2013, p.84). Uber should, therefore, it treats its customers with high decorum and always keeps its operations up to date.
In supplier power, the company should always strive to ensure that its product is very consistent and of high quality as this is the only way to keep customers. The products should be availed on time so as to avoid delaying the operation of business.
Below is the table representation of Uber Company’s SWOT analysis
— honest employees, availability of funds, motivated employees
-unlimited fleet of vehicles. In addition, normal taxi regulations do not apply to Uber.
-low operation cost owing to the fact that the company relies on customer-to-driver interaction
-convenient for driver hence they can work for flexible hours.
-getting a car is easy and using cashless payment method is appropriate hence highly rated customers.
-the company is characterized by high valuation therefore it attracts many investors.
— limited access to loans
-many people can imitate the idea
-there is no real bonding between the company and the customers hence low incentive to continue using the services
-there is concerns of privacy due to the fact the customer’s information is recorded whenever they use taxi services.
-high operative costs for the vehicles.
-Unpredictable business model
— Because of high prices and long waiting time, customers are not satisfied with the traditional taxi services.
-the company can utilize the cheaper electric cars hence reducing costs and increasing profit margin.
-the company is able to increase its valuation. Increased valuation might attract more investors hence more operation capital.
-The company can explore big and available markets such as India. Such markets are characterized by inconvenient taxi services.
— low profit margins does not make drivers happy. As a result, the company might be subjected to bad publicity.
-The company can be restricted from operating in countries such as Germany that are strict legal regulations.
-In case the company does not satisfy the local authorities, then its operations might be limited.
-the expected arrival of self-driven cars, for instance Google Cars, will reduce the operation.
-Increase in fraud and scandals can damage the brand.
A new company has to be marketed for people to know it and this is inevitable if Uber-Company wishes to attract customers. There are a few guidelines which Uber may use for them to reach their target customers fully and these include the following:
This is where exactly people should look for the services that Uber-Company intends to offer. Uber should avail this information online considering that it has an active website where the prospective customers can log into anytime they want. Uber also has a social media page which will even be more efficient in reaching people since it is very fast and reliable. Social media is very crucial when information needs to reach the whole world within the shortest time possible, and it would, therefore, be ideal for Uber-Company (Cronin et al. 2011, p.27).
The truth of the matter is that the amount the company charges in the United States of America cannot be charged in China where Uber intends to open a new branch because of some reasons. First, the company is still new in China and to attract customers, the price has to be reasonable. This is a good strategy of luring people into loving the company. Another reason is that the market trend in the United States of America is different from that of China, and therefore, it would be a bit prudent to consider that when deciding the price
This is imperative since it is only through promoting a company that people will come to know it. Uber-Company should select the best method of improving its services which will enable many people to get access to the information (Grundy, 2006, p.33). It may be through billboards or even through televisions but most importantly it should be something many people can access. It should be looked into about the method that Didi Kuaidi uses since that is a company which is likely to impose stiff competition to Uber.
Uber-Company is an established company in the United States but the important question, however, is that does it have services which will appeal to the new customers it is likely to find in China? This is a crucial issue which should be considered and after which the company should consider removing the features and the services which might not be of use as that one will only be unnecessary wastage of money (Cravens and Piercy, 2006, p.32). Then Uber should decide whether it is the same name it will continue using in its new location or if they will change its name maybe to suit the location. The name should be different from any name within the locality so as to avoid any unnecessary confusion.
Partnering with allies
This will be paramount if Uber-Company needs to expose its brands to the new customers (Aspelund et al. 2007, p.114). It makes it very easy when marketing a company and this is why it would be ideal for Uber to partner with existing businesses in China like Didi Kuaidi. It will enable Uber to deliver better service delivery since Didi Kuaidi already knows what the customers like and the trend in that business.
Embracing customers’ interaction
This is an important forum since, through it, a company may realize what adjustments the customers want and work on it towards improving the service delivery (Grosse, 2010, p.61). There are several forums of achieving this, and one of them is social media which of course is ideal considering that the company will be able to get a response from the customers instantly. It is also fast and very reliable and would be perfect for that matter.
Involvement of the employees
It motivates the employees so much when they are involved in issues happening in business for instance decision making because it makes them to feel valued. Uber-Company should, therefore, involve its employees in making major decisions regarding its operations. This will bring a sense of belonging hence improvement of delivery of services (Doyle, 2009, p.42).
Collaborating with influential employees
This is a good strategy because other employees do not like questioning people they hold a high opinion on and the prominent ones. Thus, it is happy to keep them close and involves them when making any decision because how they will sell it out will be welcomed by people out there (Rittgen, 2010, p.53).
Uber Company targets customers at both local and international levels. Those doing their businesses within China will highly benefit from the services of Uber Company and this will definitely boost business in China. With the Smartphone app it will be easy to liaise with customers from outside. Uber targets both sexes and it is not limited to any age bracket because their services are needed by customers at different levels and purposes. On behavioral segment, Uber will be anticipating the loyalty it has enjoyed in all parts that it has been operating in. With their good management, many people will gradually like the services they offer. Uber Company will be operating within China and outside China, mostly in the neighboring countries and linking Asia to the United States of America as well. The services shall be heavenly distributed within China to enable all citizens to access.
Considering the fact Uber Company does not own vehicles in most of their markets, the company relies on the drivers vehicles to enhance its operation. Through the drivers, the company is able to reach its customers.
In conclusion, Uber-Company has to consider the likely competitors and appropriately work on its marketing strategies if it wishes to succeed in opening a branch in China. All factors which affect the business should also be taken into consideration and apparently might come up with a plan to counter them.
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