Recently I read an article regarding ‘Five Below‘ as the fastest growing teen retailer. This company sells a variety of products, ranging from “tech accessories and sporting goods to party supplies and bedroom decor,” and it has expanded quickly from 82 locations in 2008 up to 366 locations now. This rapid growth may be result of the company’s successive adaption to one of Porter’s strategy: low cost focus strategy.

The low cost focus strategy can be easily identified in the advert posted above: they are specifically targeting teenagers (there are a bunch of teenagers smiling) and it also claims that all prices will not exceed $5 ceiling. This is a really powerful strategy as most teenagers only have a limited amount of pocket money, and a low cost strategy is perfect for them. Five Below also attracts them through positioning their products as “coolest, trendiest, and highest quality stuff,” which seems to be exactly what teenagers look for. In my point of view (and from experiencing teen years myself), I think teenagers place trendiness and coolness among their top priorities: they always want to fit in, and be accepted as a ‘normal’ individual (following social norms). Therefore I think good use of porter’s strategies along with correct positing of the firm can have really promising results, with Five Below as an example.

However, I also recognize that this success may only be for short run period: low cost goods are great, however I notice that among the newer generations, teenagers are starting to have increased wealth: they are starting to look for better quality or branded goods ,and it may be no be ‘trendy’ to buy cheap things. As this mindset evolves, Five Below may hit an expansion peak soon and will need to adopt another strategy. Having everything below $5 may also become a challenge for the company as inflation in the economy is inevitable: “a dollar received in the future is less than a dollar on hand today”. As costs and prices rise within the firm, Five Below may have to adopt another slogan or even change its firm name (leading to constant change) which may lead to unsatisfied consumers as they feel their real income is decreasing. Hence although the strategy and positioning of the firm may seem very successful now, I think Five Below is bound to change its strategy in the future for sustainable growth. As other entrepreneurs notice Five Below’s success, they may also adapt the same strategy and increase rivalry in the industry, which may result as a deadly threat against Five Below.

 

Related articles:

1. http://www.buzzfeed.com/sapna/meet-five-below-americas-fastest-growing-teen-retailer
2. http://www.bloomberg.com/news/2013-06-10/five-below-soars-on-teen-shopping-craze-post-zany-brainy.html

 

B.C. Hydro has been planning a $8 billion Dam megaproject in Northern British Columbia, which as a result has raised strong opposition voices from the First Nations of BC: “B.C. is Indian land,” Premier Christy Clark declaed.

Source: http://www.vancouverobserver.com/opinion/what-site-c-dam-really-explosion-new-fracking-wells

I see this as a huge threat to B.C. Hydro (SWOT), as the First Nation Chiefs have the potential to persuade the Harper government to reject the Dam: though the Dam is estimated to cost $8 billion, however, it has not taken into account of the costs from lost farmlands and natural habitat: the Dam will cause an artificial flood, drowning 83 kilometers of the Peace River Valley. Not only will the First Nations be affected as their lands will disappear, but moreover, economy of BC will also be affected as fishing and agriculture industries upstream will be harmed severely. Altogether, these severe weaknesses in the project may eventually lead to shut down of the idea.

On the other hand, I read another article from The Sun which raises the point that although the Dam in Site C is claimed to offer new, clean energy in the cheapest form, leakage of a draft report from the Clean Energy Association of BC indicates that there are alternative ways of producing equal amount of energy, but with reduction cost of  $1 billion. With double threats shooting at BC Hydro, I think there is high chance that the government will choose to save costs and protect society, thus shutdown the megaproject.

Therefore although the project has huge potentials to help promote clean energy and provide huge amounts of hydroelectric energy for the growing population in BC, the entire project may be shot down due to better alternatives. To keep the project running, I’m afraid BC Hydro will have to offer more advantages to the BC community, such as offering them new homes and facilities in the future, to be able to gain more acceptance by the government and society.  Other actions BC Hydro could offer can include selling farmlands cheaply to the BC farmers, or subsidizing their farm production; as for the Firs Nations’ land, they should find something which have great value to replace their lost lands and homes, or offer them free hydroelectricity and give promise for clean water.

Even if BC Hydro manages to go forth with the project, the company is bound to face many more threats from external factors. Any failures of the project will be heavily criticized thus in proceeding this project, the BC Hydro bears a huge burden of perfection in the dam.

Thus from this current issue, we can have a further insight in how threats and other external factors of a business may be so powerful, that it may result in complete shut down of $8 billion worth mega-dam project. Firms must consider all factors thoroughly before making any decisions, or else it may become a very costly matter.

 

Article: http://www.vancouversun.com/news/First+Nation+chiefs+stage+Site+showdown/10215965/story.html

Bill Marriott, the Chairman of Marriott International, also happens to be a well-known cooperate blogger. From his 28th July 2014 entry, I came to realize that his company has been selected “World’s Most Ethical Company” for the 7th time in 8 years. This is definitely a marvelous achievement for his company. As I read his blog, I admire the way he views success, and the way he tries to create positive change to their community.

Bill Marriott, Chairman of Marriott International

According to Bill Marriott and other employees such as Bill Dempster, Marriott have had 87 years long worth of strong value-based traditions: they are well recognized by their stakeholders for their trust-worthiness, high respect for law, commitment to their global commitments and integrity. They are constantly trying to “fulfill expectations of the community”. Marriott have certainly worked really hard to be able to have drilled this brilliant reputation in the stakeholder’s mind.

Having read Bill’s blog and his goal to maintain a successful and good company, I think I finally understand that Freeman’s Stakeholder Theory may actually be applicable to reality, although obviously it will only apply for a very few firms; within those firms, they will always have imperfection, too.  Before knowing about Marriott, I thought Freeman’s Stakeholder Theory is impossible to fulfill: all stakeholders may have different wants which could contradict each other thus the theory cannot hold; however now that I have read about Marriott’s business objective to fulfill all expectations of stakeholders, I learnt that as long as you work really hard for it, it may be done.

On the other hand, from Bill Dempster’s video, I see that their business’ ethical success not only rely on the company’s PR, but it also involves every single employee’s commitment to the global community and traditional culture of ethics: “it’s something that starts at the top of the company.” With this note, I hope that other companies such as Nike would be able to follow this ethical inspiration and not just set their minds on objectives such as increasing market share, maximizing profit… Even if a business achieves all these profit goals, I do not think a business is successful unless it’s doing things with good value  and integrity.