Strategic business plan

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1 Executive Summary

This report is about the meaning and analysis of LEXUS in respect of strategic planning and implementation point of view.

In this report I have discussed about the history of LEXUS and their strategic marketing analysis in terms of its positioning and its growth rate and market share in today's business environment. And main purpose of the report is to plan the implementation of the strategy.

Moreover, we have discussed about the vision, mission, objectives and current marketing trends as well as the SWOT (strength, weaknesses, opportunities & threats) analysis, external & internal environmental scanning of the company in respect of their competitors and strategic formulation of the company strategy and how we will going to implement these strategy and also give some recommendations that can help to grow their market share in the future competitive marketing environment.

LEXUS competing the competitors & maintaining strong relationship with customers by taking under consideration its Macro & Micro environment very efficiently.

In this report, we also make a detailed review, monitoring and control that how company reviewed and control the strategy of LEXUS., strategies such as corporate strategies, business level and its functional strategies, action program and budget protection of the company.

2 Back Ground

The standard for research was basically the criterion given to me by our teacher. Before commencing my project I have visited the company. I had conducted few group meetings in which I thoroughly discuss concepts and over view of my project.

The Business that I would be researching on was properly selected keeping in view the contact and accessibility.It was basically research project assigned to me by our awarding body Edexcel. The main theme of the project was to choose particular excising organization and constructs its management strategy; develop vision, mission and objectives and measures plain for the implementation of the strategy the research was conducted by using direct and projective techniques and descriptive research.This was basically a very good learning experience as I conducted proper field research, and this gave me a true idea of the strategy formulation and implementation of the planed strategy that I may be stumbling upon during my professional life and for starting my business it s really very helpful for future.


My research project involves detail descriptive research. It doesn't include any quantitative research it's totally based upon qualitative data. which I collected through directly visiting to the organization and conducting interviews .and I also collect some financial information of the company from there annually financially record books. I also conduct information from different online resources. That is I exhibited the results qualitatively. E.g. how my company formulates, evaluate and control system for the implementation of the strategy.

4 Vision, Mission and Objective

4.1VISION Statement

To be the professional and innovative in Motor Industry in all around the World.


  • Lexus is committed to customer satisfaction through offering high quality with excellent services and good value of their price.
  • We take great pride in serving each other, our customers.
  • We seek continuous improvement in all that we do for the benefit our stakeholder and the society we live within.
  • To attract and retain customers with the highest value products and services and the most satisfying ownership experience.

4.3 Statement of Values

Lexus firmly committed with a corporate philosophy that incorporates solid values. We encourage a culture of mutual respect and treat both our team members and users with quick services and care. We aim to be proactively responsive to new ideas providing variety of Motors as compare to our competitors.

4.4 Objectives 

  • To Increase advertising by 70% by December 2011.
  • Generate 70% brand awareness within the consumers target market by December 2011.
  • To break even by the end of 2011
  • To increase in market share by December 2011.
  • To earn a good reputation and create a good image of the company by reducing customers complaints by December 2011.
  • To increase the sale of Lexus motors up to 3million by the end of 2014.


  • To achieve return on sales 90% by JUNE 2011 and double it by JUNE 2012.
  • To achieve cost to income ratio of 90% by May 2010 and reduce this ratio by 30% on a yearly bases.
  • To capitalize the business by January 2012
  • To always maintain high sales of 100% by January 2012.


5.1.1 Political Analysis

Since Lexus Motors operates in multiple countries across Europe and Asia, the Middle East, and Australia, it needs to pay close attention to the political climate Which are also laws and regulations in all the countries it operates in while also paying attention to regional leading bodies. Laws governing commerce, trade, growth, and investment are reliant on the local government as well as how successful local markets and economies will be due to regional, national and local influence.

5.1.2 Ecumenical Analysis

Operating in numerous countries across the world, Lexus Motors functions with a global economic perception while focusing on each individual market. Because Lexus is in a rapid growth period, expanding or forming a joint venture in over six

countries world-wide since 2007, a global approach enables Lexus Motors to adapt and learn from the other different regions within the whole automotive industry. They have skill and resources from five continents across the globe, thus when any variable changes in the market they can gather information and funds from all over the world to address any issues. For instance, if the price of the aluminum required to make engine blocks goes up in Kenya, Lexus

has the option to get the aluminum from other suppliers in Asia who they would normally get from for production in Ukraine or China.

5.1.3 Social Analysis

With out any confusion, the beliefs, opinions, and general attitude of all thestakeholders in anorganization will affect how well a company performs.This includes every stakeholder from the CEO and President, down tothe line workers who screw the door panel into place, from the investor to the customer, the culture and attitude of all thesepeople will eventually determine the future of a Organization and whetherthey will be profitable or not. For this reason, Lexus Motors tends to usean integration and rarely separation technique with foreign companiesthey acquire. In 2007, Lexus Motors acquired fordmarketableVehicles Company, which was at the time Korea's second largest truckmaker. Rather than using de-acculturation or assimilating Daewoo, Lexustook an integrated approach, and continued building and marketingDaewoo's current models as well as introducing a few new modelsinternationally just as it had been done below Korean management.

5.1.4 Technological Analysis

Lexus Motor stand its parent company, the Lexus Group, are ahead of the game in the technology field.The Organization growth is a deep understanding of economic stimuli and customer needs, andthe ability to translate them into customer-desired offerings throughleading edge. Employing 1,500 scientists and engineers,Lexus Motor Research and Development team is ahead of the pack inUK market and right with the rest of the field internationally. AmongLexus firsts are the first indigenously developed Light CommercialVehicle.In all an automobile manufacturer must change adaptand evolve to stay competitive in the automotive game and this isexactly what Lexus is doing with their rapid growth, and extensiveresearch and development.

5.2 Industry Competitive Analysis

5.2.1 Threat of New Entrance

For the current UK market for Motor Industry, it is not difficult for a Motor Industry to enter the market. However, it would be extremely difficult to take over already running major Big Organisation dominancy in UK or even make a significant amount of profit Ford holds the first-mover advantage into the Green Cars  specialty Motor Industry that gives them free reputation. Customers, especially heavy lorry drivers who are used to going to TTC as a treat or reward from their company are not going to go to other company they've never heard of. The brand name is already established also, there is already a large variety in the numerous western-style motors is available in UK, such as Rover,Ponto and Land Rover.

5.2.2 Threat of substitute products

As written above, there are a few major competitors in the Motor Industry in Uk for Lexus, namely Ford and Ponto. The substitute products, in this case, would be Land Rover. Though they are competitors, their primary products differ greatly from each other, in that they sell, Magana, Traditional Uk style Motors, These substitutes are definitely considered healthy as compared to the Lexus. Even Motors from street vendors count as substitute Motors.

5.2.3 Threat of bargaining power of suppliers

The suppliers, like the buyers, have very little bargaining power. In terms of Lexus , Fords upon its move into UK, urged many of its Indian. suppliers to also extend branches into Europe. Lexus also began helping local suppliers by giving them technological support to improve their products. This is a brilliant strategy because the supplies that Lexus would otherwise need to import from the U.S. can now be obtained domestically, and if the Indian. Suppliers decide to raise their prices;Lexus can easily switch to the local suppliers. This gives us a brilliant strategy. With this strategy, Lexus created competition among its suppliers, lowering the supplier bargaining power. In terms of human resources, labour cost is extremely low because the supply of non-skilled workers great exceeds the demand for them. With so little buyer and supplier bargaining powers, Lexus is able to have a very tight control over its prices and expenditures

5.2.4 Threat of bargaining power of Buyers

The customers of Lexus, especially as individual buyers, have almost no bargaining power because if only one customer threatens to no longer Buy Lexus, the store is not going to lower its price because the cost of losing one customer is not very great.If Lexus is not providing any Other deal or increase the prices then customer will automatically switch toward other competitors e.g. Ford, Peugeot,and Land rover, can control these things by giving them a variety of Product and other deal at affordable prices in order to grab the market and to maintain stability

5.2.5 Rivalry among existing competitors

More or less what one would expect, Lexus has little rivalry with similar Motors in India. The primary reason is that their core products are different, as in they sell different types of Motors with very different tastes and styles. For example, if Lexus raised its price for normal car by a small amount, UK Motors  lovers who may not be as accepting to any other motors In addition to that, these industries have such different target customers that the fluctuation of price for one out let is not going to affect the others. For example, a full range car at Lexus ranges about£30,000, whereas a full range care is at Fords motors can cost over£40,000. The drastic difference in price assures no price competition between these motors.

5.3 Internal Environmental Analysis

  1. Strategy
  2. Structure
  3. Style
  4. Staff
  5. Skills
  6. Systems
  7. Shared value

Lexus focusing the horizontal growth strategy in the Motors industry. Lexus has top to bottom and bottom to top style of structure as top level of management also take feedback from lower level of management, Lexus is following participative leadership style all decisions took place in General meetings on majority bases Lexus has skilled and experienced staff to work within. Lexus provide proper training to staff on to meet set standards. A special log and checked with in organization of Health and Safety. Lexus has separate production department based on very skilled worker for production of Motors. Lexus conduct different types of surveys for the feedback from their costumers and create different types of products for their customers. Lexus uses Quality Management Program Managing quality in a manufacturing company revolves around sympathetic customer expectations. Lexus aim is to be proactively approachable to new ideas only if variety of Motors as compare to our competitor in order to satisfy customers.

6 SWOT Analysis

6.1 Strength

  • New speculation by Toyota for its Lexus brand in factories in the US and China saw 2007 profits rise, against the international motor industry trend. Net profits rose 0.8% to 1.17 trillion yen ($11bn;£5.85bn), while sales were 7.4% higher at 18.55 trillion Dollars.
  • In 2003 Toyota knocked its rivals Ford into third spot, to become the World's second largest carmaker with 6.78 million units. The company is still behind rivals General Motors with 8.59 million units in the same period.

6.2 Weakness

  • Being big has its own problems. The World market for cars is in a state of saturate and so car manufacturers need to make sure that it is their models that clients want.
  • The company needs to keep producing cars in order to retain its prepared efficiency. Car plants symbolize a huge investment in expensive fixed costs, as well as the high costs of preparation and retaining labor.

6.3 Opportunities

  • Lexus and Toyota now have a reputation for manufacturing environmentally friendly vehicles. Lexus has RX 400h hybrid, and Toyota has it Prius.
  • Lexus is to target theurban youth' market. The company has launch its new Aygo, which is targeted at the sharp youth market and captures (or attempt to) the nature of dance and DJ culture in a very competitive section.

6.4 Threats

  • Product recalls are always a problem for vehicle manufacturers. In 2005 the company had to recall 990,00 sports utility vehicles and accidental trucks due to faulty front postponement systems.
  • The company is also exposed to any force group in the price of raw wealth such as rubber, steel and fuel. The key economy in the appeasing, the US and Europe also knowledge slowdowns. These economic factors are potential threats for Toyota.


7.1. Corporate level Strategies

Lexus focal point on Horizontal growth strategy, Lexus always make a decision to pursue new and more customers and secondly it decides to hunt new technology. E.g. Green Cars is one of the mile stone of this organization.

7.2. Business level Strategies

Lexus was able to greatly reduce lead-time and cost using the TPS, while humanizing quality at the same time as a Business level Strategy. This enabled it to become one of the ten largest companies in the world. It is currently as money-making as all the other car companiessharedand became the largest car manufacturer in 2008.

7.3. Functional/Departmental Strategies

ThePrinciples of Functional Strategies of the Lexus Wayis a administration philosophy used by theLexusfirm that includes theLexus Production System. The main ideas are to base management decisions on a ‘philosophical sense of purpose' and think long term, to have a process for solving problems, to add value to the organization by developing its people, and to recognize that incessantly solving root problems drives organizational learning.

8.Critical Success Factor (7 S model)

8.1 Strategy

Lexus is the world biggest and most well known Motor Production Company, with chain in more than 15 thousand locations and worldwide in 75 countries Lexus had refocused global strategies to grow up its company and licence Motor base all over the world.

8.2 Structure

  • Trainee Managers help with day-to-day running of the restaurant, and need to ensure that all operations, customer service, cash handling, marketing, purchasing, human resources, administration and training & development policies are followed
  • Responsible for working the service areas and ensuring quality product, service and cleanliness is delivered to all customers at top speed and with a smile.

8.3 Style

Lexus spotlight on participative leadership style. Each out let manager uses the style of interpersonal interface with their employees.Lexus management relationship-oriented have both touching and utilitarian elements.

8.4 Staff

  • Lexus also give proper training to all of their employees to maintain standard of the business.
  • Lexus worker turnover is low so all of their staff is loyal and shows obligation.
  • Lexus and its franchise employees are more than 700 thousand in all over the world.
  • Lexus have fully expert and knowledge staff to work with.

8.5 Skills and Competencies

  • Lexus centre on interpersonal skills as well because they are dedicated to customer pleasure through contribution high quality with excellent services and good value.
  • Lexus also maintainindustrial skills by keep reviewing Continuous improvement process to provide good quality Standard motors to their customers.

8.6 Systems

  • The quality, service, and spotlessnessprogram for judging the quality of service outcomes from the perspective of every customer.
  • The operations provision review program for measuring a Quality process implementation performance against Lexus process condition. The results of these two quality measurement programs are incorporated into the Organisation.
  • Lexus hires a specialized interviewing service to survey customers on their impersonation of creation service and quality.

8.7 Shared Values

  • Lexus also focus on imaginative ideas by given that after sale services and have some special facility for the business customers.
  • Lexus as an association franchises are at convenient places e.g. nearby city centre, big shopping malls, main roads and local area.
  • Brand equity is one of the key strength for Lexus to spread its outlet all around the world.

9 Implementations

Strategy Implementation

Strategy implementation is the development of allocating resources to support the chosen strategy



Action required

Resources required

Profit maximization.


Large scale advertising activities

Bill Board

To get a good reputation and create a good image of the Lexus

Feature control

Supply product according to set standard

require Best Stock for Manufacture

3.Stronger out lets all over Country

Land survey team

New land reform news

keeping tab on the competing chains

4.Interactive Relationship Marketing


Focus on Electronic way

Building local public relations

E Employee loyalty


Keeping employee turnover low

Commitment & proper training

6. On time Delivery


More Vehicles needed

£ 50,000.00

10.Review, Monitoring and Control

10.1 Monitoring Policy

Lexus uses special techniques and worth system for monitor all collect process and sales behavior. Lexus specially focus on to maintain quality and provide product according to set standard so they have quality specialist's staff working for monitor all managerial process behavior day to day bases.

10.2 Control

Lexus has its own Data base to keep all the record of sales and clientele. Lexus control and share aggregated demographic with advertiser and linked all franchises. Lexus also use outside company's t bill users for providing services. Lexus has proper team who manages and keeps control off all labors because they are the part of Lexus. Lexus all data and in order is copy right and highly secret to preserve its standard in the tough spirited market.


11.1 Financial performance for the last 3 years (2008-2010)

Actual and forecasted financial statement for the period ending 2010








Cost of Sales




Gross profit




Distribution costs




Administration expenses




Net profit for the year




Gross profit %




Net profit for the year %




11.2 Actual balance Sheet as at 2008-10 and forecasted balance sheet




Non-current Asset

Property, plant & Equipment




Current Assets









Cash & cash equivalent




Total current  Assets




Total asset




Equity and Reserves

Issued share capital




Share premium




Revolution reserves




Retained earnings




Total Equity & Reserves




11.3 Summary of financial budgets for the next 3 years

Actual balance Sheet as at 2007-10 and forecasted balance sheet 2011-2013




Non-current Asset

Property, plant & Equipment




Current Assets









Cash & cash Equivalents




Total Assets




Equity and Reserves

Issued share capital




Share premium




Revolution reserves




Retained earnings




Total Equity & Reserves





Total Budget£300 Million.

Marketing Activities

Time (when action)




















Advertising Agency



Marketing Asstt Sports


Event Hosting

Marketing Asstt Events


New Car Launch

Country Director


Road Show




12 Conclusion

The GX 470 is one of the three SUVs offered by Lexus luxury nameplate, Lexus. Thevehicleis placed in the middle of the smaller RX and the full-size LX in everything from size to price. It joined the Lexus line-up in 2010 and is currently in its first generation.Air Conditioner.Some Lexus GX470s may have problems with theair conditionersystem. In some cases (particular to the 2007 to 2010 model years) the A/C may not cool sufficiently, requiring various parts to be marked for repairs. Some 2007vehiclesmay need the expansion valve replaced as a result of snapping or popping noises from the rear air conditioner unit.