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Viewpoint
As a manager, I will begin with the past historical data standing of the company in order to assess
and identify the roots of the problem/ issue that have arises.
Loss leadership
Attendance is declining
Average ticket price is increasing
Technology has been double edge sword
Numbers of screens are increasing
Factoring facility and labor expenses income is often negative
Objectives
Areas of Consideration/Analysis
Competition in the movie industry in the late 2008 is very high, so we need to identify and analyze
the level of competition within an industry. The Porter's 5 Forces can help us to know on what the
companys doing and to determine the competitive intensity and therefore attractiveness of an industry
(Attractiveness in this context refers to the overall industry profitability).
You can now see the problem of the movie industry in 2008. The buyer power is low because
they act independently. If a large number of customers will act with each other and ask to make prices low
the company will have no other choice because of large number of customers pressure. Because of the
existence of products outside like DVDs and etc., the company has no choice but to increase the prices.
Indeed, considering the size of theatre and the facility itself would cost a lot. Likewise, the price also
depending on the trend that the viewer are capable of. Another, the intensity of competitive rivalry,
competitive advantage is very low because of the technological advances, it greatly affects the profitability
of the company.
As a summary, the product or services offered is unattractive, in which the five forces acts to drive down
overall company profitability, we should need to strategize our product, new offerings like discounts and
etc. The company should targeted the middle class and lower in order the business to become
profitability.
Recommendation
Conclusions
The common problem faced by the movie industry, is pirating in which until now was boom to
the middle and lower class people because of the affordability of the product or services.
Pirating should be restricted (the company should monitor, control and secure that nobodys copy
or pirate the movie). For example, they should put CCTV on every chair of the movie goers, thats
possible.
The government should ban those who are in Pirating industry. If not give them, a higher taxes.