External Environment Analysis
External Environment Analysis
JetBlue Airways Corporation (JetBlue) is a company that has focused on low-cost airline transportation service. It is also one of the top major airlines dominating the Domestic Airlines industry. To develop a better strategic business plan the company’s external business market and the effect it has on the business continuity plan must be analysis as well as the general, industry, and competitor environments. Another issue affecting companies is the role business ethics plays in gathering competitor intelligence.
External Business Market
The Domestic Airlines industry is affected by key external drivers, such as corporate profit, world price of crude oil, per capita disposable income, inbound trips by non-US residents, and domestic trips by Unites States residents (IBISWorld, 2011). These drivers also affect JetBlue Airways. JetBlue also affects these external drivers with its low-cost business structure.
In the United States domestic flying is contribute to a large portion of business customers. Companies experiencing high profits and strong business activity are more likely to pay for travel. The Domestic Airlines industry moves in line with corporate activity as businesses experience decline and increases so will the Domestic Airlines industry. The industry is largely affected by corporate profit. Even though JetBlue has primarily target leisure travelers the company is increasingly business travelers. The business traveler is a customer who during tough economic times is looking to reduce business expense associated with business travel.
As the company’s operating costs increases profitability decreases. One factor affecting operating costs and profitability is the price of crude oil. Unfortunately, companies cannot pass the entire cost of oil to their customers and must decrease their profit gains. JetBlue is not the exception and through its use of hedging is exposed to liquidity issues. JetBlue hedges on a
JetBlue Airways Corporation (JetBlue) is a company that has focused on low-cost airline transportation service. It is also one of the top major airlines dominating the Domestic Airlines industry. To develop a better strategic business plan the company’s external business market and the effect it has on the business continuity plan must be analysis as well as the general, industry, and competitor environments. Another issue affecting companies is the role business ethics plays in gathering competitor intelligence.
External Business Market
The Domestic Airlines industry is affected by key external drivers, such as corporate profit, world price of crude oil, per capita disposable income, inbound trips by non-US residents, and domestic trips by Unites States residents (IBISWorld, 2011). These drivers also affect JetBlue Airways. JetBlue also affects these external drivers with its low-cost business structure.
In the United States domestic flying is contribute to a large portion of business customers. Companies experiencing high profits and strong business activity are more likely to pay for travel. The Domestic Airlines industry moves in line with corporate activity as businesses experience decline and increases so will the Domestic Airlines industry. The industry is largely affected by corporate profit. Even though JetBlue has primarily target leisure travelers the company is increasingly business travelers. The business traveler is a customer who during tough economic times is looking to reduce business expense associated with business travel.
As the company’s operating costs increases profitability decreases. One factor affecting operating costs and profitability is the price of crude oil. Unfortunately, companies cannot pass the entire cost of oil to their customers and must decrease their profit gains. JetBlue is not the exception and through its use of hedging is exposed to liquidity issues. JetBlue hedges on a
References: Bureau of Transportation Statistics, Research and Innovation Technology Administration. (2011). Flights All Carriers – All Airports (Data Elements): 2011 data (International flights services for major airports). Retrieved from http://www.transtats.bts.gov/Data_Elements.aspx?Data=2 Hitt, M., Ireland, R., & Hoskisson, R. (2009). Strategic management: Competitiveness and globalization, concepts and cases (8th ed.). Mason, OH: Cengage Learning. IBISWorld.(2011, December). Domestic Airlines in the US Industry Report. Retrieved January 21, 2012, from, IBISWorld database. JetBlue Airways Corporation. (2011). JetBlue Airways Reports July Traffic [Press release]. Retrieved from http://investor.jetblue.com/phoenix.zhtml Stoller, G. (2010, September 15). JetBlue, Southwest beat big carriers for service, quality. USA Today. Retrieved January 21, 2012, from http://www.usatoday.com/travel/flights/2010-09-15-1Aairlinecomplaints15_ST_N.htm