Stage 1

Case Study, Stage 1: Business Environment Analysis

Before you begin this assignment, be sure you have read the “UR UMUC Healthy Fitness Center Case Study.”

Business Environment Analysis for UR UMUC Healthy Fitness Center

The UR UMUC Healthy Fitness Center has been in business since 1980 and has seen an increase in competition from small fitness centers, Cable TV and Internet Exercise channels and sites, WII and other TV Game Console, various exercise equipment infomercials and increasing supply of Exercise DVD’s . One of your fitness instructors told you that she saw a sign announcing the construction of Gold’s Gym (a well-known national fitness franchise) a few blocks away. Your staff is worried and is looking to you to provide reassurance that the competition will not affect the business. In addition, you have decided to develop your strategic direction for bringing the UR UMUC Healthy Fitness Center into the 21st century.

You know that Michael Porter’s Five Forces Model is a useful tool for analyzing a business, understanding the importance of the five competitive forces and helping to develop its Generic Strategy. It is also used to aid organizations facing the challenging decisions of dealing with changes made by existing competitors, entering a new industry or industry segment or developing a strategy for dealing with new competition. The Five Forces Model helps determine the relative importance of the forces affecting competitive position that could affect the future success of a business and includes:

* Buyer Power

* Supplier power

* Threat of substitute products or services

* Threat of new entrants

* Rivalry among existing competitors

The Five Forces and the Generic Strategy are fully described and discussed in the textbook, and the Business Model and Competitive Advantage are covered in Module 1. In order to analyze the Fitness Center’s current competitive position and develop a Generic Strategic direction, you have...