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Introduction

 

Sky Mall is shopping mall which is building or group of buildings that contains stores. The stores are connected by walkways so that consumers can easily walk between the stores. Malls can be built in an enclosed or open air format. Sky Mall has brought a new revolution in the world of shopping. Nowadays shopping is no longer limited to buying stuff that you require but now it has extended its sense to have lip smacking food along with enjoyment, fun, refreshment and entertainment. In Sky Mall all these things are easily available in a completely comfortable environment. Sky Mall is an emerging trend in the global arena. The first thing that comes in our mind about the shopping malls is that it is a big enclosed building housing a variety of shops or products. Shopping was no longer limited to a mere buying activity it has become synonymous with splurging time and money. People simply go about roaming through the shopping mall in order to peep through the window of the shop and often ending up buying something they like. The consumers desire a combination of comfort and suitability which the shopping malls cater to, and so this format of shopping has become so popular all over the world, and especially so in Malaysia. The inclusion of amenities like restaurants, multiplexes, and car parks attract more and more crowd to shopping malls that are considered family hangout zones.

 

Sky Mall was founded in 2012 by Miss Shikin from a market stall in Malaysia. The business has grown over the years as one of the largest food retailers in the world and now operating in 8 countries worldwide, employing over 200,000 people and serve of many thousands of customers over the every week. Sky Mall is among the largest industry in the Malaysian which is food and drink retail sector, which provide primary production, retailing and manufacturing. In recent years Malaysian supermarkets have come under increased surveillance over their treatment of suppliers, especially of any own label products, still the development of strategic supply networks has been a necessary part of most supermarket strategies for the past decade. This report provides a vision into the supermarket company, Sky Mall with prominence on its external environment analysis and company’s analysis of resources, culture and ability. It provides online services through its subsidiary.

 

 It operates under four flags of Extra, Store, Metro and Express. The company sells almost 1000 products included their own company name label products which are 50 % more cheaply than other company product but there are at three levels, value, normal and finest. Sky Mall has another retailing services offered include some other stores in Malaysia. Sky Mall has its branches at Perak, Penang, and Johor. It employs over 4,300 staff based in all over country. As another mall provide service like personal loan, credit card and other service. The Sky Mall also offers a popular range of simple personal banking products such as mortgages, credit cards, personal loans and savings. The Club Card, Credit Card rewards customers with Club Card points on all usage of the card which customer will get surprise gift when the points are enough; while customers receive Club Card points as a ‘thank you’ on mortgage repayments.

 

Question 1

 

As an owner of some of these new malls who currently provides your products and services through malls in the retail industry, analyse the environmental factors that effect your sales?

 

Analysis 1* PESTEL ANALYSIS

 

The PESTEL Analysis will allow us to examine the different parts of the PESTEL to determine in what way analysis business endeavor will affect the business. The PESTEL Analysis is a single editable slide that offers the PESTEL acronym located inside of a circle of hexagons. Each one of the letters in the acronym comes with its own text space out to the side so that you can elaborate on each point. The different points will include political, economic, social, legal, environmental and technological aspects of the project.

 

PESTEL ANALYSIS

 

Here are some ways to analyze the environmental factors that affect sales in Sky Mall which using PASTEL, SWOT and BCG MATRIX analysis

 

Political

 

Political factors like government policies and regulation of the retail industry affect its revenue and profitability. The political environment affects so many things including economic environment of a nation and international supply chains of businesses. Political stability means better business because political disruption leads to the disruption of supply chain and sales. In all the nations, the business environment is affected by the political landscape. The Asian economy is growing at a faster rate than other parts of the globe. However, the government and Red tape can be a big problem in the Asian nations. For the big International retailers it can be quite difficult to expand into the Asian countries.For Sky Mall employment legislations, the government encourages retailers to provide a mix of job opportunities from flexible, locally based jobs, and lower paid to highly skilled, centrally located jobs and higher paid. This is also to meet the demand from population categories such as students, working adults and senior citizens.

 

Economic

 

The economic condition of this organization is in a good shape. Economical factor is one of the external factors of the environment. It includes different factors like GDP, national income, per capita income, export and import, purchasing capacity, and inflation rate. These factors give shape and form to the development of the economic system of the country. Due to the increasing impact of globalization and liberalization this organization economy is gradually shifting towards an open market economy. This also results in price fluctuation in this organization.These economic factors are largely outside the control of the company, but their influences on performance and the marketing mix can be weighty. Even though international business is growing, and is expected to contribute bigger amounts to Sky Mall profits over the coming years, the company is still very much dependent on the Malaysian and Asia market. Therefore, Sky Mall would be badly affected by any slowdown in the Malaysian and Asia market and are exposed to market concentration risks.

 

Social

 

This organization is a social unit as it is established within the society by the people, for the people of the society. This organization obeys and fulfills social and cultural norms and value. This organization manages to proper product quality according to the ever changing life standard of the people and also following and maintaining religion and ethnical value. Hence Cultural diversity and preferences by region or country, the clothing range does not cater to all, ages and sizes of people, the demographic with the most disposable, income sits within the 25 to 65 year old demographic and investment is required in market.

 

Technological

 

The field of technology is very dynamic as there is a continuous up-gradation in the existing product due to various innovations and renovation. This organization is upgrading its existing technologies, including various machineries and equipment, computer technologies, etc. In order to add its strength by producing extra beneficial product and services in terms of quality, uses, etc. This organization has passed to upgrade itself with the change in the technological field.

 

Environmental

 

Like the other industry sectors, the retail sector is also affected by the sustainability concerns. Packaging, waste reduction, renewable energy and several other concerns related to sustainability are there before the retail sector. Apart from that the focus is also on packaging and sourcing in an environmentally responsible manner. Sky Mall is always driving improvement in packaging sustainability across the entire supply chain. It is focusing not just on reducing its carbon footprint but also on achieving 100% renewable energy usage in the long term for Sky Mall.

 

Legal

 

The legal factors are also just as important for the retail sector. There are so many laws related to business and employment that affect it. Labor laws are particularly a big pain for the retailers who have to maintain low prices to remain competitive. Sky Mall has had so many tussles with laws over labor related issues. Apart from that, the other laws like product and packaging related laws also apply to the retail sector. Overall, the legal scenario is quite complex and retailers have to be cautious since any violation can result in big fines. More than that, Sky Mallhas had to deal with their fair share of legal issues in the past. These laws and the level of legal scrutiny differ from nation to nation and everywhere the retailers have to be cautious about compliance.

 

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ANAYSIS 2* SWOT ANALYSIS

 

SWOT analysis is a framework used to evaluate a company’s competitive position by identifying its strengths, weaknesses, opportunities and threats for Sky Mall. Specifically, SWOT analysis is a foundational assessment model that measures what an organization can and cannot do, and its potential opportunities and threats.

 

SWOT ANALYSIS

Strengths

 

Describe what an organization excels at and separates it from the competition a strong brand, loyal customer base, a strong balance sheet, and unique technology for the Sky Mall. For example, a hedge fund may have developed a proprietary trading strategy that returns market beating results. It must then decide how to use those results to attract new investors.

 

Weaknesses

 

Stop an organization from performing at its optimum level. They are areas where the Sky Mall to improve to remain competitive higher than other competitor mall average turnover, high levels of debt, an inadequate supply chain or lack of capital.However, that’s not to say all hope is lost. It might be harder for Sky Mall to compete with a chain, but there are plenty of other ways small mall can be more competitive such as by developing strong, meaningful relationships with customers, which was not only one of the Sky Mall strengths, but also something chain other mall simply cannot offer.

 

Opportunities

 

Refer to favorable external factors that an organization can use to give it a competitive advantage. In this example, Sky Mall may involve investing in technical expertise to take advantage of the opportunities presented by product delivery apps, or sourcing locally grown produce more aggressively in an attempt to reduce costs, increasing sales and market share, if a country cuts tariffs.

 

Threats

 

Refer to factors that have the potential to harm an organization. For example, another mall which sell product at half price may affect Sky Mall sells. Other common threats include things like rising costs for inputs, increasing competition, tight labor supply and so on. Competition from other Malls like AEON Mall, Taiping Mall makes Sky Mall losing anchoring at new prime location. On the other hand, major super centers and other new store openings in area small towns reduce shopping traffic to its mall. Lastly high prices reduce the number of times people come to its Sky Mall to shop

 

ANAYSIS 3* BCG MATRIX ANALYSIS

 

BCG matrix analysis also used by Sky Mall for designed to help with long term strategic planning, to help a business consider growth opportunities by reviewing its portfolio of products to decide where to invest, to discontinue or develop products. It’s also known as the Growth or Share Matrix.

 

BCG Matrix

 

The Stars

 

As the name makes clear, stars are those business units that have a large market share in a fast growing industry like Sky Mall. These product lines have a clearly visible market or niche leading path and require large amounts of funding to ensure that Sky Mall can fight of competitors and maintain the growth rate. Hence, Sky Mall aim to turn stars into their next cash cows with the inevitable decline in the growth of the Mall. This can happen potentially if they are able to maintain their position as a market leader. If this does not happen, then Sky Mall stars can turn into dogs.

 

Question marks or Problem Child

 

These question marks or problem children are those business units that have a smaller market share in a high growth market. This is where most businesses will start from and at this point the business unit has the potential to grow market share and turn into a star or lose further marker share and turn into dogs when the growth of the market itself declines. Careful study and analysis is required for business units in this category to assess their potential and worth. Sky Mall potential is seen then further investment can be made into them. In additional, the natural cycle for most products in that they begin their life as question marks and turn into stars as their position clarifies. When the market growth slows down, they turn into cash cows and at the end of the cycle, the cash cow turns into a dog. According diversified Sky Mall with a balanced portfolio is in the ideal position to use its strengths to capitalize on its growth opportunities and potential.

 

The Cash Cows

 

The product lines that fall within this category enjoy a large share of the market in a slow growing industry. This means that they are able to generate revenues in greater amounts than the investment required to maintain their business. The Sky Mall product line may be considered boring and settled in a mature market, with the company holding it to continue to generate revenues. The Sky Mall will attempt to improve these as much as possible with as little investment as possible.

 

Dogs

Product classified as dogs always have a weak market share in a low growth market. These products are very likely making a loss or a very low profit at best. These products can be a big drain on management time and resources. The question for Sky Mall is whether the investment currently being spent on keeping these products alive could be spent on making something that would be more profitable. Dogs hold low market share compared to competitors and operate in a slowly growing market. In general, they are not worth investing in because they generate low or negative cash returns.

 

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Question 2

Plan your strategies and action plans to ensure profitability in the business that you are currently engaged in.

 

SWOT ANAYSIS

 

Market analysis is a crucial part of a marketing plan, as it discusses about the organizational strategies, customers, marketing effectiveness, Porter’s five forces, SWOT analysis and marketing effectiveness.

 

This is some the solution to Sky Mall to improve their business in future and brings beck their businesses like earlier when this Sky Mall was set up.

 

SWOT ANAYSIS 2

Strengths

 

The main strength of Sky Mall is its strong brand name and its valued customer service. The company is far less integrated than the other big company that which makes them more flexible compared to others. Sky Mall has been the main shopping center in the retailing industry for 6 years. Loyal or not, many people have been used to shopping here because of its variety of stores. Moreover, competitive prices strategy. The focused price cuts made it possible for Sky Mall to draw in far more consumers via competitors along with catch the volume that backed the bottom prices. Hence, strength of Sky Mall is large business structure. Sky Mall operates its business not only in Malaysia but in many countries in Asia as well. Sky Mall believes in direct marketing rather that via a middleman or agent. Sky Mall property locations across the country bring good business to the mall.Next the excellent service, security and facilities. Lastly, the strength of Sky Mall is customer loyalty or relationship. Sky Mall obtained consumer loyalty or perhaps connection simply by introducing promotion by giving points in theClub Card.

 

Weaknesses

 

Sky Mall weaknesses are that still it substantially depends on the Malaysia for its sale. Business model which Sky Mall uses approaches for the Malaysia, instead for other world. Limited global presented. Sky Mall is current planning legislation limits development of new space. Though Sky Mall sales grow with the low priced items there is a falling on sale insignificantly on expensive products.

 

Opportunities

 

Sky Mall can carry out a high degree of purchasing capacity to guarantee, that it has a scale effect in its homebrand line.Offering customers unique service features found nowhere else. In additional, opportunities in Asia provide excellent possibilities for growth. The most important, growth of online sales shows a fine possibility for an increase of sales Sky Mall. At June 2018 Sky.net have grown 4.3 million customers and it moved profitable status suggesting further growth and development within this technological area can be developed. This happen because now in this era most of the people do not have time to go out for shopping, by online shopping people can purchase their item easily.

 

Threats

 

Global economic decline is the barrier and created an impact on Sky Mall business. Some of the environmental factors such as climate changes, political issue, and taxes issue can become a threat for Sky Mall. The raising of the costs of raw resources from both food and product will crash general profit boundaries. Sky Mall can export restriction on some products to Far East location will decrease profit margin. Plus, customer’s mentality which is frequently changing and it may be a good threat as well. For Sky Mall there is a determined threat of capture from the other market like Tesco, Giant, The Store and Mydin who has equally means and motive to follow such accomplishment.

 

For market analysis, PESTEL approach will be applied in which political, economic, social, technology, environment and legal factors will be discussed.

 

PESTEL ANALYSIS 2

Political

 

Operating in a globalized environment with stores in 8 countries Sky Mall now operates in 8 countries in Asia which are Malaysia, Indonesia, India, China, Thailand, Brunei, Singapore and Filipina. Sky Mall performance is highly influenced by the political and legislative conditions of these countries. For employment legislations, the government encourages retailers to provide a mix of job opportunities from flexible, locally based jobs, and lower paid to highly skilled, centrally located jobs and higher paid. This is also to meet the demand from population categories such as students, working adults and senior citizens. Sky Mall understands that retailing has a strong impact on jobs and people factors being an inherently local and laborintensive sector.

 

Economic

 

These economic forces substantially do not depend on the company, but their influence on productivity and marketing maybe deep.Income of potential customers in Sky Mall area and employee salary trends in the service business industry. Though the international business still grows, and it is expected, will assist the greater sum on profit of Sky Mall within the next several years, the company still depends strongly on the market of the Malaysia. Consequently, Sky Mall will be strongly affected with any slowdown in market of the Malaysia and exposure to market concentration risk.

 

Social and Cultural

 

Current trends specify that the Malaysian clients have inclined to “one stop” and “volumetric” shopping that is connected with various social changes. Therefore Sky Mall have increased the quantity of product example, house hold and clothing items available for sale. Demographic changes, such as ageing of the population, an increase of women workers and decrease in house preparation of meal means, which the Malaysian retailers are concentrating on added value products and services. Besides concentration is now moving towards, own labels share of business mix, supply chain and other operational improvements which can lower expenses of business. National retailers are more and more constrained to find new suppliers.

 

Technological

 

Technology is a major environmental variable which has influenced the development of many of Sky Mall products. The new technologies are benefit toboth customers and the company. Customer satisfaction rises because goods are readily available services can become more personalized and shopping is more convenient. The launch of the Efficient Consumer Response (ECR) initiative provided the shift that is now apparent in the management of food supply chains. The Sky Mall stores utilize these following technologies which are wireless devices, intelligent scale, electronic shelf labeling, service business software updates and improvements to mobile devices and other communications.

 

Environmental

 

Responsibility to a society and to operate by society is benefit as a whole. With the basic social question threatens sellers of food stuffs were the environmental problems and one of key areas for the companies to operate in socially responsible with maintenance of its reputation. Therefore, accepting this tendency within the limits of wide ethical positions, to corporate social responsibility of company Sky Mall concerns ways in which the organizations exceeds the minimal obligations to the interested sides specified by means of regulation and corporate management.

 

Legal

 

Legal factors will directly influence the company’s operations of your service business right now. Some legal factors can also determine your final cost of doing business and impact demand for Sky Mall company services. Various legislations government policies also render direct influence on Sky Mall performance. For example, food retailing commission has offered Code of practice should be created, prohibiting many of existing practice, such as demanding payments from suppliers and variation in the coordinated prices retrospectively or without notice. Availability of powerful competitors with known brands creates threat of intensive price wars and strong requirements to differentiation of production.

 

Conclusion

 

Sky Mall has the potential to maintain as a lifestyle mall, hypermarket, and supermarket. With their right move and wise extension strategy, it is not surprise if one day, they would be the leading and the biggest mall, hypermarket, and supermarket in Malaysia. To support dynamic growth toward year of 2020, Sky Mall plans to construct a robust financial base, focusing on the maximization of cash flows by improving returns on investment and diversifying the means of funding. To serve the demand of customers and trend setters, Sky Mall may have to expand and ventured into fresh wet markets like Cold Storage and adding health and wellbeing services such as Guardian Pharmacy under their new investment budget and securing greater customers in the future. Even though Sky Mall store expansion strategy will drive sales growth, the markets remain cautious on pressure that is affecting its profit margin. Indeed, the market will closely monitor Sky Mall expansion plan in Malaysia. The alternate plan of the Sky Mall will make 30 % from the marketing plan. The corporation will change the marketing strategy to distract attention from penetration on the market for progress of the market in long term profitability of performance and achievement of corporate objectives. Success of Sky Mall shows, how with branding and effective granting of services that one can achieve in moving beyond splashing a logo on Billboard. It assisted powerful identities, having made them retiling to the concept into virus and its spending in culture through various channels, cultural sponsorship, political disagreements, consumer experience and expansions of brands. The accomplishment of Sky Mall shows how far the branding and valuable service deliver be able to come in affecting further than splashing one logo on a billboard. It had fostered influential identities by building their retiling thought and spending it out into the society via a diversity of channels, culture funding, political argument, and consumer knowledge and brand expansion. In a rapidly shifting industry atmosphere with an elevated competitors’ anxiety Sky Mall contain to assume new extension strategies or diversified the existing in order to continue its foremost marketplace situation in an already recognized trade market. The company must continuously get used to the fast changing situation. Strategy formulation must therefore be regarded as a procedure of constant learning, which includes knowledge about the goals, the consequence of potential procedures towards these goals and how to execute and accomplish these actions.