Value Chain Theory Analysis Of Competitive Advantages Of Sopo's "Acetic Acid"

The analysis and establishment of competitive advantages are the most important in order to survive and fulfill strategic objects in an intense competition of market. This dissertation demonstrates how to figure out and build up Jiangshu Sopo acetic acid Ltd. competitive advantages by analyzing its value chain.The case of this dissertation is Sopo Group which is the main supplier of Chinese acetic acid market. The dissertation will begin with the industry analysis which includes the overview of global and Chinese acetic acid industry, the analysis of international acetic acid production, sales, research trends and the current situation of Chinese acetic acid industry, and figuring out the overall developing trends of acetic acid productsAccording to the competitive theory of Michael E. Potter, this paper studies the five forces of acetic acid industry including the current rivals, the threats of entry, the threats of substitutes, the bargaining power of suppliers and the bargaining power of buyers. Moreover, we systematically analyze the internal situations (strengths and weaknesses) and external situation( opportunities and threats), so that we can clear the competitive position of Sopo Group.Next, this paper further studies how the Sopo Group gained the competitive advantages, from the perspective of value chain. It defines the main rivals of Sopo Group and choose the benchmark company according to the analysis of rivals within the industry. Based on these and using the tools of value chain we can compare Sopo's acetic acid business with the standard company and analyze of Sopo's acetic acid business's various internal value activities in order to find the sources of competitive advantages.Finally, in accordance with analysis, cost leader strategy is the main competitive strategy of Sopo Group. With the aim of building up cost advantages, we analyze its dynamic factors and the possibility analysis of the horizontal, vertical, upstream and down stream extension in the value chain of acetic acid. Then we conclude that the best strategy is to vertically extend the acetic acid value chain in order to gain the sharing advantages. Moreover, we put forward the plan of re-construct value chain and specific implemental strategies.