Grab Taxi Case Study

The significant players in the market develop cartels for imposing restrictive measures in offering services to customers. However, such players uphold the financial independence and separate identities but are governed by same policies. Therefore, Grab taxi is positioned under the oligopolistic market structure in Singapore which has six taxi companies. It is governed by common interest of maintaining its market position together with other taxi companies in Singapore. However, Taxi industry is closely monitored and tightly controlled by the government as well as other entrenched players whose pose a lot of competition to Grab taxi. Increased entry barriers The taxi industry is characterized by a lot of entry barriers that make it hard for different investors to venture into the market.

The dominating players in the sector block new entrants because of economies of scale. They lower their costs to retaliate against any potential threat entering the industry. Therefore, high initial and operating expenses deter such new entrants from venturing into the industry. Therefore, their increased competition through cost reduction makes it unfavorable for such firms. Such segmentation will guarantee its competitiveness in the market because people found in such regions will automatically need transport services. (b) Sales forecasting method for Grab Company for the next three years Projection and time series analysis Assuming that previous patterns of consumer behavior will continue, the approach concentrates on patterns changes, thus totally depends on historical information. According to Kotler, “It is based on what people have done and thus involves analyzing records of past buying behavior and using them to project into the future” (Kotler 1998).

The method is applicable in the case where there is available data for several years concerning a certain product or service, and its performance trend is clearly stated. Its basic policy is that the process of forecasting must rely on previous data concerning the subject. (b) Explain why it is crucial for Grab to engage in CSR activities Corporate social responsibility is a responsibility of the firms towards addressing the sustainable development agenda, and it involves balancing different parameters affecting its economic progress, environment, social progress in an ethical way. Every firm is held accountable for its decisions and activities towards the society and its key stakeholders (ISMAIL, 2009). It is important for Grab to engage in CSR activities because it has to be accountable for the expectations of its customers, comply with the government regulations and demonstrate standard expectations in its operations.

Donna Wood said that “Companies are not responsible for solving the problems of the society. But they are certainly responsible for the problems they cause or create. The last opportunity is the physical condition of the car. Different online tax companies are profit-oriented and tend to forget service and comfort for its customers. Therefore, Grab should ensure its cars are always in good condition and attractive to the customers instead of only focusing on making a profit in future. Threats The most common threats that may face Grab in future are continued fluctuations by dominating companies, poor behavior by drivers and unfavorable regulations. The dominating taxi companies tend to regulate prices if they notice any potential threats entering the market, something that can affect the profitability of Grab Company in future.

(b) Grab’s pricing strategy for riders in Singapore The pricing strategy adopted by Grab for its riders is based on the number of bookings they make. The company charges them a 30 cents commission in every booking they make. These amount charged for every booking accepted is slightly lower compared to what other taxi companies charge drivers in Singapore (Freischlad, 2015). Further, the moment a taxi driver subscribes to the app he/she is awarded a SGD 10 credit where the commissions are deducted. The company is offering best pricing deals to its drivers that are better compared to its competitors. A Framework for successful new product development.  Journal of Industrial Engineering and Management, 4(4), 746-770. http://dx. doi. org/10. pdf Kirkby, J.  What Is a Customer Relationship Management Strategy? Bus.