Question:
Discuss about the Business Case Development. The Strong Australian Currency and high oil prices threaten its profitability, but it can exploit the online retail, and the ASEAN open skies agreement opportunities.
Answer:
Introduction:
Michael Porters developed the Porters five model, a tool for analysis of a business’ competitive environment, such as Qantas’, to strategically position a business to weather the competition (Porter, 2006). First, the aviation industry in Australia is very competitive with new entrants making forays into the market making it quite a competitive market for Qantas (Ansoff, 2005). Second, Qantas airlines have little bargaining power over the suppliers, and they can negatively affect the company by changes in their price. Third, the purchasers of Qantas services in Australia are unlikely to shift loyalties to the other competitors. Forth, air transport, especially for international travels and hopping between islands in Australia cannot be substituted for any other mode of transport making Qantas airlines position pretty solid. Finally, the Aviation industry has relatively few entrants due to the prohibitive capital outlay necessary for before stating an airline company and breaking even.