1. and trade restrictions forced by the government have

1. Set out an
analysis of the key forces in the general environment (both national and
international) which have an influence on the business. Among the key forces
are Political, Economic, Legal, Socio-cultural, Environmental/Ecological, and Technological.
(Around 600 words)

Political analysis; 

We Will Write a Custom Essay Specifically
For You For Only $13.90/page!


order now

It inspects the guidance of
government. It is about policies, rules, and regulations on the industry or
association with reference to Virgin Atlantic Airline. It can be debated that
several political factors such as taxation policies, labour low, customer
policies and trade restrictions forced by the government have a great impact on
airline industry. According to Virgin Airline management, they are an
expression with various political challenges when business spread into foreign
countries compared to the UK, ( ex; USA & Australia). Most of the political
challenges are embraced by licensing, bureaucracies set by the UK and foreign
governments also increased parameter and control of business operation by
government.

Economic analysis;

Virgin Atlantic Airways has been
challenged with hard competition from other firms in the industry, for example,
the organization was required to lower its flight rates following an analysis
of prices for air travels by its major opponents in the air transport industry
such as American Airlines and UK Airways. Because of this competition in 1990 ”
Virgin Atlantic offered first class ticket at business class prices, inventions
included limousine pick up for first class passengers and seat back video
entrainment systems for economy class passengers”. This new decision creates an
opportunity to win the economic competition and get more profit & customers.

Social factors,

British Airways, Atlantic Airways and
other airlines such as EasyJet have already requested the EU and the French
government to advance an action plan to minimize the effect of ATC attacks on
passengers (The Guardian 2017). A number of ATC union strikes hit France in
2016 due to social unrest over a series of disputed labour reforms from the
Socialist government, causing Virgin Atlantic to cancel many flights to and
over France The peak summer season in 2016 was difficult to operate for many
airlines including Virgin Atlantic, largely due to social factors outside of
the airline’s control particularly, air traffic controller (ATC) strikes in
France.

 

 

 

 

Technologic
analysis:

Further as Jones (2009) has argued,
the Internet makes industry competition perfect because it allows passengers to
compare airfares of different airline companies with just a few clicks, which
in effect affects pricing ability, according to Gal-Or (2011). Nevertheless,
the internet also offers a cost-cutting chance for Virgin which is why it
recently launched AIR4, Virgin Atlantic’s major technological revolution in
company history, which saw Virgin invest in IT-based passenger service systems
such as the new mobile app, self-service booking technology and improved kiosk
functionality (Annual report 2016).

Legal environment:

During the
December 2016, Virgin Atlantic pilots decided to take industrial action in
a row over union recognition after the pilots union, Professional Pilots’ Union
(PPU) which represents over 70% of Virgins 900 plus pilots, demanded to be the
only exclusively recognized union for Virgin’s pilots and for British Airline
Pilots Association to be derecognized (The Guardian 2016).

Environmental
Factors 

People are much
attentive to the effects of climate change since the people of all nations
carry knowledge about some form of negative disaster; from floods, drought
extreme record-breaking hot temperatures, record breaking sub-zero temperature
etc., that have been credited by scientists on global warming. Virgin Atlantic
like many other airlines faced sustained working disruption in June last year
(2016) as well as January 2017 due to adverse weather conditions, in particular
thunderstorms in South East England, which led to a cancellation of flights to
and from London Heathrow and Gatwick and a delay in many other flights
(Swinnerton 2017).

Total words 572

2. Conduct a Five
Forces analysis of one of the Virgin companies, among the forces are new entrants,
substitutes, buyers, suppliers and competitors. (Around 600 words)

The threat of new entries:

The entry and the
exit barriers for the airline industry are rather high compared to other
industries. One of the facts is where a lot of capital is needed to enter the
sector. Previously, Virgin Atlantic airline faced a major problem which is
buying new aircraft for entering the industry because during that time, the
cost of aircraft is very high and maintaining it is difficult. Airlines cannot
leave the industry when they choose as the officials often insist that they
achieve their promised responsibilities towards their stakeholders in the situation
they need to exit the industry. Once Virgin Atlantic entered, they faced
external environment problem of regulation and maintenance. Virgin Atlantic is
a company with strong background, good reputation in the industry and also a
shareholder with Singapore airline giving extra advantage in this industry.

 

Substitutes

Forever product, companies or service have
similar substitutes. The main substitutes for the airline industry are the
buses, train, and ships. But most of the time long destination travel
passengers are choosing airline industry but some of the passengers using other
substituting depend on their budgets and etc. The main substitution is for the
Atlantic airline, not a bus or ship its British airways routes and united
routes. Because Atlantic airways have short and long flight facilities for the
same destination as well as united airways also providing same route and
facilities for their passengers. This is the main substitutes challenge for
Atlantic airline

Power of suppliers

Virgin Atlantic is one of the leading
airline company because of this reputation they always picking quality and
solid suppliers. Aircraft manufacture is the prime supplier’s in the airline
industry in this case Atlantic airline main aircraft manufacturers are BOEING
& AIRBUS. Fuel supplier also mainly impact because fuel is basically
required for operating the aircraft. Technology also a key factor, so in this
case last over the year IBM and NCR make the support for IT solution for
Atlantic airline.  Engineering and other maintains service provided by the
airport.

The power of Buyers

Buyers are the most
powerful force in the airline industry. Because there are the market
and they directly impact the company profit. Modern days Airline market is
competitive also buyers have several choices. Because of that competition,
Atlantic airways continuously try to provide quality and attractive service for
passengers. Atlantic airways always think about the ability to provide the
cheapest airfare with extra unique service. Buyers Used to porches there is
ticket directly from the Airline Company, but Atlantic airline increase in the
distribution Channels Company everywhere to retain the competition for the
selling air tickets. This empowers the airline to cover the market but on other
hand grant bargaining power to the buyers. But Atlantic airline give n other
option to buyers to porches there are ticket by online its save cost and time
for all-around verging buyers

Competitors

The competition is
very stiff on this days. Virgin Atlantic airline has several different
competitors and they offer equal product and service for passengers. But virgin
airlines always try to give deferent style of deal and unforgettable travel
expires for they are passengers.one of the reputations instance is “because of
this competition Atlantic airline offered first class ticket at business class
prices, inventions included limousine pick up for first class passengers and
seat back video entrainment systems for economy class passengers “.This new
decision creates an opportunity to win the economic competition. The
fundamental competence of the Atlantic Airways is their high technology, cheap
ticket, and good schedules

Total words 573

3.
Conduct a SWOT analysis. Among the issues to be addressed are the business
response to the threats and opportunities; was the business reactive or
proactive? How the business activities are organised? What are their

SWOT is a valuable device
to study economic accounts and developing healthy work environment of any
corporation. It is a key step towards any strategic design in a business. It is
measured to be a very significant source of info for judging and understanding
any kind of conditions in the organization. Below SWOT analysis aimed at Virgin
Atlantic.

 

 

Strengths

·        
Virgin Brand standard by 98% of British Public. Brand reputation is
important for any company, the Atlantic airline got strong foundation and
airline was ranked 6th in world best, the only British carrier
to make the world top 10.Because of punctuality, Quality and the speed of
dealing with reward claims.

·        
Averagely Carried over 5 million passengers in a year. Passenger’s
always expected good customer service in each travel business /economy and
verging able to fulfill their customer satisfaction

·        
Virgin Atlantic airline is one of the biggest British airlines with over
35 destinations because Atlantic has a customer base and preferred airline off
comfortable customers

·        
Atlantic airline has outstanding advertising and marketing management
team

·        
Virgin Atlantic Using high technology: including in-flight music, video,
games, and movies.

·        
Offering loyalty card for regular customers and also
providing quality food and comfortable service for them.

·        
More than 8000 people are employed with airline and they are quality and
well-trained staff

·        
Reasonable pricing for business class offers more services.

·        
Partnership with Singapore airlines (49% shareholder)

Weaknesses

·        
Flight Delays and need to improve flight
competence. Virgin Atlantic
Airways is known as one of the believed airlines, take care of passengers and
their needs but sometimes their flights do get delayed due to reasons which
could have been foreseen.

·        
Lack of travel routes and limited, increasing
destination and extra flight

·        
Heavy reliance on celebrity personality of Richard
Branson for the promotion of the brand. because one man owner and director of multiple companies it
can give negative impact and risk for the company

·        
Main competition from cash-rich Gulf airline.

·        
Disproportionate growth skewed towards USA flight
compared to other high growth regions especially China, India and midlist

·        
Atlantic airline decides Cut routes to Chicago, Toronto, and Cape in
relation to the September 11 tragedy.

·        
Cost of keeping two five star chefs, lounge, and limo service impact
negatively for profit

 

Opportunities

·        
US government approved the third runway at Heathrow

This is a great opportunity for Virgin Atlantic. The
planned development will create new and affordable extra capacity at Heathrow.
It will also reduce the cost of operating to or from Heathrow which is
currently the world’s most expensive hub airport (Johnson 2016). Further,
expansion of Heathrow post-Brexit will allow carriers like Virgin Atlantic to
offer more direct flights to not only UK destinations but also up to 40 new
cities abroad such as Wuhan, Osaka, and Quito

·        
Continued low fuel price in 2017  will
translate into low fuel cost

·        
Technology is key factor for airline, flight
internet connection and Website needs to be improved

·        
may be an unexpected opportunity for investment and make it the more
strong brand name

Threats

·        
Main threats for the Atlantic airline is fuel price is the fluctuation
because 15% of total airline expenses going under fuel price.

·        
modern days traveling for leisure and business is greatly impacted by
the global economy and terrorist attacks .because of this issues fewer people
are likely to travel .this leads to low income to the Virgin airline and during
this period possible losses due to its operating cost exceeding income

·        
Atlantic airline has competition for routes British and the USA

·        
Taxes

x

Hi!
I'm Eileen!

Would you like to get a custom essay? How about receiving a customized one?

Check it out