International scientific e-journal

ΛΌГOΣ. ONLINE

16 (December, 2020)

e-ISSN: 2663-4139
КВ №20521-13361Р

ECONOMICS

UDC 339.1

EOI 10.11232/2663-4139.16.12

DEVELOPING OF THE TRADE ENTERPRISE’ COMPETITIVE STRATEGY

ONYSHCHENKO Taras

student of the Faculty of Economics, Management and Psychology

Kyiv National University of Trade and Economics

 

UKRAINE


Abstract. The article discusses existing developments on the issue of creating a competitive strategy for the trade enterprise. The advantages and disadvantages of individual methods of creating a competitive strategy for the trade enterprise also the development of a scheme of the main elements and stages of formation of a competitive strategy for the company.

Keywords: trade, competition, strategy, enterprise, development.

Formulation of the problem. The current development of domestic trade, which takes place in the context of deepening market relations, liberalization and demonopolization is increasingly based on competition. Therefore, an important task of any enterprise is to achieve competitive advantages and to strengthen its competitive position. Competitiveness consists of a list of strategic advantages that are manifested in market by comparing it with the relevant competitors. This is what necessitates the formation of a competitive strategy for choosing effective directions and enhancing the development of the business entity.

Analysis of recent research and publications. The process of developing a competitive enterprise strategy was investigated by a considerable number of foreign scientists in particular: I. Ansoff, P. Drucker, A.G. Mintzberg, M. Mescon, M. Porter, Chandler, and many others [1]. Among domestic scientists:O. Berezin, L. Dovgan, A. Mishchenko, V. Nemtsov, O. Sumets, et al [4]. Recently, the problem of forming marketing strategies of the company, as well as improving the efficiency of their use, are engaged in such domestic scientists as: V. Aschaulov [2], A. Besedina [3], O. Kovtun [5], Y. Korolenko [6], O. Kryvoruchko [7], Y. Lisichenko [8], Y. Orlovskaya [9], O. Panchenko [10], N. Prishchepa [11], I. Rybalchenko [12], O. Cymbalist [13].

However, the problematic issues (components of provision, principles, tools, ways and means) in shaping the competitive strategy of the retail enterprise still remain unresolved.

The purpose of the article. The main purpose of this article is to develop a scheme of the basic elements and stages of forming a competitive enterprise strategy based on the generalized existing approaches in the scientific literature.

Presenting main material. Domestic trade enterprises approach the choice of competitive strategy more spontaneously, according to circumstances, than as a strategic process planning. As a result, companies often change the strategic course, which leads to the inability to achieve high financial results and ensure the further development of their own business.

Competitiveness is understood as a comparative characteristic of an enterprise's ability to comprehensively increase its own competitive advantages in order to obtain an advantage in the marketing and sales of products that satisfies market needs, and ensures the profitability of the business.

Summarizing the views of scientists on understanding the essence of competitive strategy (Table 1), and taking into account the peculiarities of the functioning of trading enterprises, it becomes obvious, what a competitive trading company strategy is a logical response to the need to ensure its effective operation by achieving a dynamic equilibrium with the external environment; an instrument of formation and retention of advantages in competition; the basis for optimal allocation and efficient use of resources and efforts.

Today, the concept of developing an effective enterprise competitive strategy has a sufficient level of theoretical elaboration. However, there is a need to specify the procedure for forming a business activity of a particular enterprise when planning its further development and substantiating the relevant competitive strategy. Considerable attention should be paid to the results of the analysis on the features of the competitive market in which the enterprise sells its products. The wider the enterprise the set of advantages and the higher their qualitative characteristics, the more opportunities for its successful activity in the market. Competitive advantages provide the company with unique values ​​that form an advantage over its competitors. Competitive advantage is achieved through successful strategic actions. Developing an optimal strategy is the most important prerequisite for successful enterprise activity in the market.

A retailer becomes competitive if its aggregate potential is appropriate to the external environment. In this case, the dynamic changes occurring in the external environment needs a constant analysis and adjustments according to the available factors that influence the management of the competitiveness of the enterprise according to its chosen strategy [6].

Enterprise competitiveness management is the activity of forming management decisions, which in turn must prevent negative external influence in order to achieve leadership in accordance with the set strategic goals.

The competitiveness management system, in our opinion, is characterized by a set of interrelated elements that function over time as a whole, while solving the main task - ensuring the ability to achieve the planned goals of enterprise development by meeting the needs of all interested subjects of economic activity of the trade sector.

 

Table 1. Systematization of scientific and methodological approaches to understanding the category "competitive strategy"

Source: author-based [1-13]

Fig 1. Structure of elements of ensuring the competitiveness of the trade enterprise

Source: author-based

 

Note that the level of competitiveness of a retail enterprise depends on the elements of the process of sales of goods, the degree of efficiency of use of all types of resources,efficiency of the enterprise, etc. Therefore, in order to achieve a stable position on the market, it is necessary to create and constantly improve the mechanism of maintaining the level of competitiveness of the enterprise, the purpose of which is the sale of goods and the provision of services that can withstand the impact of competition with similar goods and services offered by other entities in the retail trade industry.

Conducted theoretical studies of the process of ensuring the competitiveness of the enterprise, as well as the study of organizational and economic conditions of its formation on the example of a particular group of retailers in Cherkasy, allowed to form the structure of elements of ensuring competitiveness enterprises (Fig. 1).

In today's market environment, every trade company needs to be guided by the desire of consumers to receive high quality goods and services on time when planning their activities. Therefore, it is worth noting that the system of present needs in the market largely determines the means and methods of implementing the strategies and directions of development of the retail trade enterprise as a whole.

The strategy of a trading enterprise is a comprehensive program of realization of the basic directions of its development on the basis of the formed long-term goals of economic activity, the choice of the most effective ways of their achievement, the use of methods of adjusting the aggregate potential in changing environmental conditions.

The process of developing competitive strategies for retailers involves the following steps:

1. Evaluation of the position occupied by the enterprise on the market;

2. Evaluation of the interaction of internal and external factors;

3. Analysis of strategic alternatives to behavior enterprises in the market and its development;

4. Choosing a competitive strategy, according to the situation in the market and the goals of the trading company.

The goal of a competitive strategy is the ability of an entity to identify strengths and weaknesses, evaluate internal resources and compare them with a similar trading enterprise [8]. In this universal there is no competitive strategy for all trading enterprises, however, analysis of national theory and practice has allowed to distinguish typical competitive strategies for the development of retail trade enterprises. The goal of a competitive strategy is to allow business entities to identify their strengths and weaknesses, evaluate internal resources and capabilities compared to similar trading businesses.

The choice of tools and methods for implementing the strategies ensures the consistency of all activities of retail trade enterprises. Based on competitive strategies, it is approved plan (sequence of actions) on achievement of competitiveness of the enterprise in the market [10].

The strategy of a trading enterprise is a complex program of realization of the basic directions of its development on the basis of formation of long-term goals of economic activity, the choice of the most effective ways of their achievement, the use of methods of adjustment of the aggregate potential at changing environmental conditions.

The process of developing competitive strategies includes the following steps:

I. determining the position of the enterprise on the market;

II. evaluation of internal and external interaction factors;

III. identifying strategic alternatives to market behavior and development;

IV. choosing a competitive strategy that is appropriate to the situation and objectives of the trading enterprise.

A number of recommendations can be made on the basis of a system of elements developed by the authors to ensure the competitiveness of the retailer. Long-term competitive enterprises can apply strategies that orient the business to radical action by introducing fundamentally new products and services. There is a similar strategy optimal for large shopping malls, supermarkets and department stores [12].

In turn, the horizontal diversification strategy and the integrated growth strategy are the best for retailers with this level of competitiveness. As a result of horizontal integration, so-called chain businesses will be formed that have the same type of stores focused on the average customer with average needs and capabilities in the city or region. This will allow to obtain favorable conditions for the purchase of goods and to carry out a single trade policy. Diversification contributes to the growth of the company market share turnover and number of regular customers, which will ensure optimal allocation of resources and stability in increasing the level of profitability.

 The ultimate goal of integration for competitive businesses may be software trading, that is, establishing direct control of a trading company over the manufacturer. At the same time, it should be noted that integration is beneficial not only to the economic entity and the end consumer, but also to local authorities, as it determines the infrastructure of the city as a whole, increases its level of economic development.

A preliminary assessment of the performance of stores of different formats revealed that in the medium term, retailers of Home Goods and Specialty Enterprises are recommended to use reduction strategies (low cost strategies): an enterprise closes or sells one of its units (or types of business) ) to make long-term changes to business boundaries.

Retail Universities or Cultured Products are recommended to apply horizontal strategies diversification or integrated growth. Opportunities for growth of these enterprises are manifested in the introduction of new goods, the use of modern technologies, the expansion of the sphere of activity at the expense of own production of goods, etc. In the short term, we recommend to retail companies to use concentrated growth strategies that are characterized by the formation of the optimal range, the development of services, the search for new markets.

The use of private strategies for specific areas of activity of trading companies can increase their overall level of competitiveness, create the time reserve required to develop and implement a more effective overall strategy. When evaluating options for possible action in a competitive market, it is worth pointing out that: you should concentrate your strengths where competitors show their weaknesses. Accordingly, enterprise management is a conscious and planned action to create and develop competitive benefits. It should be borne in mind that the new strategy of the retail trade enterprise in the conditions of competition requires the modernization of the appropriate management system, a certain level of qualification of staff, his interest in the final results of work, etc. Conclusions and suggestions.

 So competitiveness of an enterprise is not the result accidental combination of circumstances, and as a result of deliberate efforts both by the managers of the enterprise and by the ordinary employees. Domestic trading companies need to pay considerable attention to the priority and importance of developing their domestic capabilities. Their characteristics and mechanism of improvement represent one of the key factors of competitiveness. The growing relevance of the problems of managing the competitiveness of trade enterprises in Ukraine is primarily due to the complexity and ambiguity of the processes of formation of market economic relations and those shifts that occur as a result of integration into the world economic processes.


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РОЗРОБКА КОНКУРЕНТНОЇ СТРАТЕГІЇ ТОРГОВЕЛЬНОГО ПІДПРИЄМСТВА

ОНИЩЕНКО Тарас Володимирович,
студент факультету економіки, менеджменту та психології
Київський національний торговельно – економічний університет
УКРАЇНА

Анотація.
У статті розглянуто  існуючі напрацювання  щодо створення конкурентної стратегії для торговельного підприємства; переваги та недоліки окремих методів створення конкурентної стратегії для торговельного підприємства, а також розробка схеми основних елементів та етапів формування конкурентної стратегії для підприємства.


Ключові слова: торгівля, конкуренція, стратегія, підприємство, розвиток.

© Онищенко Т.В., 2020

© Onyshchenko T., 2020

 

This work is licensed under a Creative Commons Attribution 4.0 International License.

PUBLISHED : 06.12.2020