Introduction
This is an informal report addressed to the City Analyst outlining the analysis and evaluation of HMV Group plc’s environmental and strategic position, giving suggested new organisational strategies and plans.

Environmental and Organisational Audit

Environmental and organisational audits are used to discover a company’s position in their market and environment, and the company’s physical position.
Two possible environmental audit techniques that can be done on a company like HMV Group plc are Porter’s 5 Forces and PESTEL analysis.

Porter’s 5 Forces

(Source: Franteractive Inc, 2008-2009)
Porter's Five Forces model is made up by identification of 5 fundamental competitive forces:

Rivalry among the existing players

HMV Group plc is one of the world’s leading retailers of music and DVD and the leading retailer of books in the UK and Ireland in terms of total sales; with HMV operating through 692 stores in 7 countries and online, and Waterstone’s operating through 313 stores in the 4 countries and online (HMV Group plc, 2009a). Even though HMV Group plc is a huge successful company, they still have to keep a close eye on their competition, because it is always possible for one of the competitors to develop in a way that will increase their market share overtaking HMV. Such competitors include, Amazon, Play.com, supermarkets, iTunes, eBay, WH Smiths, Borders and although illegal, piracy.

Threat of new entrants

Threats of new entrants should always be of worry to any business no matter how big and established they are. It is unlikely that a new entrant will pose an immediate effect on HMV Group plc, because is an extremely difficult task to get high market share as soon as one enters a market; but it will mean more pressure on HMV Group. However if a well establish company moves into HMV Group’s market it is likely that they