Gazelle in 2012 Harvard Case Solution & Analysis

Threats: With all the opportunities, available Gazelle indeed is threatened by external environment. Its rivals including eBay and others are a constant source of threat.
Major threats include threat of imitation and the bargaining powers of sellers and buyers. Porter’s five forces model explains it at best.

Internal Analysis:
VRIO and gazelle:  VRIO stand for valuable, rare, inimitable and organized respectively. While analyzing a company it kept in view to discuss VRIO. Gazelle has been offering valuable, rare, inimitable and organized goods at the same time, which led it to acquire sustainable competitive advantage. (See appendices)
Economies of scale and scope: A company reaches economies of scale when cost incurred for the products gets lesser as the quantity of the goods increases. Economies of scope are related to acquiring lower costs when offering or producing a couple of products together. Gazelle in this regard attained both while selling and buying a large number and variety of used products. (See appendices)
Attaining economies of scale internally has caused a difficulty for new rivals to compete against Gazelle. Moreover, Gazelle has developed product efficiency too which is attained by keeping the cost lower in long run.

External Analysis:

Porter’s five forces model:
Porter five forces model explains all those forces which affect the organization externally.  (See appendices)

  • Threat of new entrants:
    There is possible threat of competitive entrants apart from current competitors.
  • Threat of substitute services:
    There is a minimum threat that a new service evolutes in this industry.
  • Bargaining power of buyers:
    With the presence of other service providers in the market, buyers might want the used products at lower prices.
  • Bargaining power of sellers:
    Sellers may also want to sell their products at a higher price.
  • Current rivalry:
    Current competition may become hard as the competitors grow in various aspects. But currently the rivalry is moderate because gazelle has a competitive advantage over other rivals.

PEST Analysis:
PEST stands for political, economic, social and technological factors respectively. (See appendices)

Political:
There is less political influence on the working of Gazelle but there might be a threat of more legislations and taxes in future.
Economic:
It refers to the interest rates, inflation rates etc. the economic factors of the region have now become stabled after the financial crisis of 2007-9.  A recession season again may cause changes in the profitability of gazelle.

Social:
Social trends are becoming favorable for Gazelle, people are trying to either recycle the used products or sell them.
Technological:
Technology is getting advanced day by day, which is good sign for gazelle as new products are formed and people switch to them selling their old products.

Keys success factors for Gazelle:
In my opinion key success factors for Gazelle are following:
Easy access: It takes no time to access to Gazelle to sell or buy anything.
Fast: Gazelle is very popular in customers for its fast transactions.
Customer-oriented: Gazelle has been customer oriented from its origin. This had added up to its growth vitally.
Quality Assurance: Gazelle has occupied the minds of customers as a brand, which assures quality used products.
Synergy: Gazelle’s synergy with its online partners and large retailers has also made its contribution for the success of Gazelle..................................

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