IndexPestelPoliticalEconomicSocialLegalKey factorsConclusionAnalysis of the industrial environmentBargaining power of suppliers (low)Bargaining power of buyers (low)Threat of competitors (high)Threat of substitution (moderate)G8 Education Limited, founded in 2006, is a provider of early childhood care and education services and facilities throughout Australia and Singapore. The company is a shareholder-owned for-profit organization and is the largest AXS-listed childcare operator in Australia. Through the acquisition, it has various brands under its umbrella. G8 Education has 495 centers in Australia, with almost 80% in Queensland, New South Wales and Victoria and 21 in Singapore; compared to the market leader, Goodstart Early Learning, which has 649 centers across Australia. Say no to plagiarism. Get a tailor-made essay on "Why Violent Video Games Shouldn't Be Banned"? Get an original essay The company has a total of 9927 employees. According to its 2017 annual report, it has total revenue of $796.8 million and a market share of 6.8% making it the second largest player in the industry, behind Goodstart Early Learning, 7.9%. G8 Education differentiates itself by recognizing community demands and investing in educational resources, including knowledgeable educators and assistants. PestelPolitical In 2016-2017, public spending on early childhood education more than doubled compared to ten years ago. A new subsidy was introduced in July 2018, aimed at low-to-medium income families, which varies based on income level, hours worked and type of childcare. This subsidy, earmarked by the government at $23.2 billion, will be paid directly to childcare workers. Additionally, a $1.2 billion child care safety net was introduced to help the neediest families. Childcare workers with children with additional needs are supported with additional funding under the Inclusion Support Programme. This initiative represents an opportunity to be exploited by operators in the sector. EconomicRecently, the labor force participation rate has increased sharply and the unemployment rate is expected to fall to 5.25% as GDP increases. Since 2016, the participation rate has grown by 1.1% to 65.5% and is driven by increased female participation (RBA,2018). Additionally, from 2016 to 2017, average weekly full-time earnings of regular-time adults grew 2.3 percent to $1,567.90, and average total weekly earnings of full-time adults increased 2.2 percent. ba $1,628.10 (ABS, 2018). The social birth rate increased by 1.41% from 304,100 in 2016 to 308,500 in 2017. The introduction of the baby bonus and state subsidies contributed to increasing the birth rate, offering opportunities to the markets. Marriages in 2016 (118,401) increased by 4.2% compared to 2015 (113,595). Despite this, there is a worrying trend of increasing the average age at first marriage for both sexes. Compared to 2015, in 2016 the average age increased by 0.2 years, reaching 30.3 years for males and 28.7 years for females. This is a threat as it would be more difficult for a woman to conceive at an older age as her fertility begins to decline at the age of 32. Also more common for women over 35 are pregnancy complications and miscarriages. These factors can dissuade mothers from conceiving, which would have a negative impact on the birth rate. With fewer births, this implies there would be a smaller pool of buyers to draw from. The rates offemale and maternal labor force participation have increased over the past decade and are expected to increase further (RBA, 2018). As the number of mothers increases, this trend presents an opportunity for the childcare industry. Legal In 2011, under the Paid Parental Leave Act, all workers who perform primary care activities and earn $150,000 or less per year are entitled to eighteen weeks of paid leave at the federal minimum. salary. Unpaid leave to care for children's health and paid leave to spend time with children and support their educational, social and emotional development are also given. Paid maternity leave not only improves women's health, but also ensures that women are not excluded from working or earning while they have children. With these incentives, more people would be willing to have more children, making this an opportunity for the early childhood care sector. early childhood workforce was implemented. As regulations and requirements become more stringent, this could pose a threat to the industry. Key drivers As illustrated, the key drivers of change for the childcare sector are social, political and legal factors. The rising birth rate, government subsidies and the paid parental leave law are opportunities that market participants can exploit. The factor holding back the growth of the sector is the stricter regulations governing the sector and the increase in the age at marriage. Factors like technology and environment do not affect the industry much. Conclusion Overall, the industry is growing and the opportunities to be exploited outweigh the threats. That said, G8 Education should exploit the opportunities, but the threats should not be overlooked and monitored. Industry Environment Analysis The purpose of this analysis is to predict the attractiveness and profitability of the Australian childcare industry as a whole. Entrants (Low) Although the industry is not saturated, there are several obstacles for new entrants. According to the Australian Child Education and Care Quality Authority, there are a number of increasingly stringent guidelines that a healthcare provider must follow. Market penetration costs are also relatively high as the cost of centre-based accommodation, teacher salaries, facilities and equipment may discourage new entrants. Furthermore, larger operators are better able to attract qualified personnel and have a better mix of personnel, such as specialized personnel, which would be a differentiator of the operator. This would be a deterrent for new entrants into the market. Therefore, barriers to entry into the industry are high and the risk of new entrants is low. Bargaining power of suppliers (low) To support child care provider operations, supply chain management is essential, therefore, powerful suppliers could negatively impact profitability. According to Job Outlook (2017), a government initiative, the number of childcare workers in Australia has increased significantly and is expected to continue to grow. In 2017 there are 142,200 carers in the sector. With an abundant supply of carers, the bargaining power of suppliers would be reduced as there would be a large pool of carers to draw from. Bargaining Power of Buyers (Low) As the birth rate increases, resulting in a greater need for child care, there would be more buyers. When there are many buyers, they have no bargaining power over service providers..