GUNNS AND THE AUSTRALIAN PULP AND PAPER MANUFACTURING INDUSTRY

Gunns Ltd. is one of the largest companies operating in the paper industry business sector of the Australian economy. The company is facing some difficulties operating its business activities in the recent years due to some strategic issues associated with it. This study highlights the strategic problems of the company and suggests measures that can be taken up by the company to ensure its sustainable growth in future. The external environment of the company has been analysed using PESTEL analysis and the various competitive factors affecting the company have been identified utilising the Porter’s five forces model analysis concerning the global paper industry. The strict environmental regulations and the strong supplier power in the paper industry are identified to be having a significant impact on the company. The internal environment of the company has also been analysed utilising SWOT analysis as the strategic tool. The core competencies of the company have been identified to be its diversified products portfolio and it is trying to attain competitive advantage in the market through the strengthening of its core competencies. The financial analysis of the company shows that indebtedness is a major problem of the company and it is facing difficulty to source its fund for future investments. Based on the in-depth analysis of the company and its environmental conditions the best strategic alternative for the company has been identified to restructure its business model, focusing more on plantation-based business and accepting the proposed investment proposal related to Bell Bay pulpwood mill.

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