Analysis of the competitive environment

Résumé du document

Since its creation in 1999, EuropaCorp won more recognition in the French market than in the international. The company was created by Pierre-Ange Le Pogam and Luc Besson, famous director and producer. The company broke into the film distribution and production markets. However, this firm, besides its main activity of film production has its production departments and distribution networks with other activities, such as: video distribution (by DVD, by VOD (Video On Demand)), TV rights sales to local or international distributors, strategic agreements with brands, merchandising and by-products related to films. Moreover, the company is developing complementary activities: for instance, music publishing, the production of advertisements and the publication of books related to the films.

Thus, since 1999, 60 production or coproduction films were released and around 57 millions audience were from France on 31th August 2008. Some examples: Kiss of the Dragon (2001), The Transporter Saga (2002, 2005 and 2008), Michel Vaillant (2003), Danny the Dog (2005), Tell No One (2007), Taken (2008) or Be Kind Rewind (2008). With an average of 10 to 15 films produced per year, EuropaCorp is one of the most dynamic producers in the French market.

Extraits

[...] Indeed, if companies are not satisfied by the products quality, then they can easily change of suppliers. Moreover, these suppliers don't have substitute products, so they don't have the choice of buyers. That enhances their low bargaining power. Finally, a moderate differentiation of the products, which varies just about quality, as the last factor gives them a low power. To conclude, suppliers have low bargaining power, so they are price takers. They must be content with the price they buy their products. Substitute products: Substitute products of cocoa and chocolate products are numerous. [...]

[...] Retrieved from http://www.unctad.org/infocomm/anglais/cocoa/eureg2000_36en.pdf Hill, C.W.L. Jones, G.R. Galvin, P. Haidar, A. (2007). Strategic Management: An Integrated Approach (2nd Ed.). MA: John Wiley & Sons Australia, Ltd. Integrated studio. (n.d.). Retrieved from http://www.europacorp-corporate.com/US/index.html La nouvelle chronologie des médias au JO. (2009, July 13). Retrieved from http://www.allocine.fr/article/fichearticle_gen_carticle=18475733.html Les réglementations autour du chocolat. [...]

[...] In order of appearance, buyers are movie theatres, then the audience before supermarket (or generally speaking, retail business), and finally TV channels. On the whole, buyers, except the audience, have quite the same bargaining power. But the reasons are different. Indeed, movie theatres, in order to attract the most audience as possible, have to define a programme with movies produced or distributed by big companies. This permits them to make higher profits than with low budget movies (most of the time). These profits force them to buy movies to renowned studios. [...]

[...] If the business is losing momentum, and the company is losing so much money that it has to quit the market that is not always possible. If the market includes high exit barriers, it is very difficult to the company to quit the business. In that case, exit barriers are stockholders, without their agreement (including loss for them); the company cannot literally get out of the business. Because these barriers are high, rivalry intensifies. Finally, a last element strengthens rivalry amongst implanted firms. For the case of EuropaCorp, diversity of competitors is extensive. [...]

[...] Whereas, for the chocolate industry, it is pretty well-balanced: buyers have power, but suppliers don't have many. Thus, chocolate companies can drop their purchasing prices (if suppliers don't agree, companies can change their suppliers), and so decreasing their selling prices. Finally, the numerous substitute products in the chocolate market create a lot of alternative products instead of bars of chocolate. Yet, this is a good indication for the chocolate market. Undeniably, substitutes create a maximum price products of this category can reach. [...]