The market potential for the floppy sprinkler irrigation system in the global agricultural sector
Thesis (MBA)--Stellenbosch University, 2012.
This research study analyses the market potential for the Floppy Sprinkler irrigation system in the global market. It explores the global irrigation market and its environment to identify the driving forces that influence the industry as well as the potential that Floppy Sprinkler could unleash as a competitor. The researcher assesses the industry value chain to determine the fit and alliance opportunities for Floppy Sprinkler in the value chain. The study further analyses the competitive pressures influencing the competitive environment. Applied research is used in this study to gain a comprehensive understanding of the market. Acknowledged diagnostic models in the field of strategic management were used to guide the study. These included the PESTLE analysis to evaluate the macro-environment of the agriculture sector; the value chain analysis to assess the agricultural industry value chain; Porter’s Five Forces Model to analyse the competitive pressures for Floppy Sprinkler; and the SWOT analysis to identify the strengths, weaknesses, opportunities and threats. The relevant data were collected through both primary and secondary sources. Two questionnaires were designed, the first to industry specialists in the agriculture sector with the purpose to gain insight of the irrigation and agriculture environment; and the second to Floppy Sprinkler irrigation system users, with the purpose to obtain a rating, opinion and relevance of the product in the market. The research disclosed that forces within the macro environment influence the industry significantly. These specifically revolved around climate change, water scarcity, land availability, soil degradation, population growth and changing lifestyles. The value chain analysis revealed that opportunities exist in the agriculture industry to create horizontal and vertical alliances to strengthen Floppy Sprinkler’s position in the market. Competitive pressures in the market include direct competitors of Floppy Sprinkler, as well as the bargaining power of suppliers and buyers. Threat of new entrants and substitute products are not perceived to be immediate competitive pressures for Floppy Sprinkler owing to its cutting-edge technology, which offers a distinctive competitive advantage. Finally, opportunities were identified, which served as recommendations for Floppy Sprinkler in developing its strategy.