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Kelly's Salon

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Introduction Kelly’s Salon, which opened in 1995 by owner Kelly Kostanza, has come a long way from the once one-chaired barber shop. Today, Kelly’s Salon offers a broad range of services to include men’s / women’s haircuts and styles, and a shampoo station. This paper will assess Porter’s Five Forces analysis to determine the factors that could impact the businesses success. In addition, it will explore ways Kelly could gain a competitive advantage in today business environment. Lastly, we will identify business improvements that will help support the strategies to gain a competitive advantage. Five Forces Analysis To help Kelly’s Salon gain a competitive advantage, it is important to take a step back and assess what factors are affecting …show more content…

Kelly’s Salon is not the only location that is offering haircuts and styles, therefore the buyer power is high. This will affect the prices customers are willing to pay for a service. This could have a positive impact for Kelly’s Salon since she is focusing on a cost leadership strategy. By offering a lower price for services paired with other process improvements on how her business runs, this strategy could prove effective at generating and retaining customers. positive …show more content…

In the case of Kelly’s salon, this force is neutral because a customer wont normally want to cut their own hair, therefore establishments like Kelly’s Salon are relied on by customers. By incorporating a cost leadership strategy this will help steer those customers in the direction of Kelly’s Salon instead of the competitors. neutral no THREAT OF NEW ENTRANTS The threat of new entrants refers to the threat new competitors pose on existing competitors in the same industry (Wilkinson, Threat of New Entrants (One of Porter’s Five Forces), 2013). The threat of new entrants is high in this case. The growth in the local area has increased, giving consumers more options to choose from thus contributing the need to implement a cost leadership strategy in order to gain a competitive advantage. negative

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