Strategic Planning
Retail Strategy is a overall plan to gain a competitive advantage through the use of distinctive retail mix to capture the patronage of one or more targets markets.
Retail Strategic Planning
the process of planning the organization, implementation, and control of all the firms activity. Strategic Planning - long-term, broad based intentions. An outline of what the retail firm hopes to accomplish
Develop a mission statement for the firm Define specific goals and objectives of the firm Develop basic strategies to reach objectives and fulfill mission Identify
Strengths, Weaknesses, Opportunities and Threats
Plans are usually different for each strategic business unit ( often a chain with a separate name) within the overall retail organization
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1- Define the business mission
2-Conduct a situation audit; Market attractiveness analysis Competitor analysis Self-analysis
The Strategic Retail Planning Process
3-Identify strategic opportunities 4-Evaluate strategic alternatives 5-Establish specific objectives and allocate resources 6-Develop a retail mix to implement strategy 7-Evaluate performance and JITENDRA KUMAR DIXIT make adjustment
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Elements of a Retail Strategy
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Benefits of Strategic Retail Planning
Provides thorough analysis of the requirements for doing business for different types of retailers Outlines retailer goals Allows retailer to determine how to differentiate itself from competitors Allows retailer to develop an offering that appeals to a group of customers Offers an analysis of the legal, economic, and competitive environment Provides for the coordination of the firms total efforts Encourages the anticipation and avoidance of crises
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Organization Mission
All employees of a retailer (from top to bottom) need to know the organizations future direction, its core business, its core customers, its philosophy of operation. These should be able to be concisely summarized in a short mission statement. The mission statement must consider: the Retail Environment the Organizations Resources any Distinctive Competencies and Management Preferences
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Ownership and Management Alternatives
A Sole proprietorship is an unincorporated retail firm owned by one person. A partnership is an unincorporated retail firm owned by two or more persons, each with a financial interest. A corporation is a retail firm that is formally incorporated under state law; it is a legal entity apart from its officers.
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Organizational Objectives
If a mission statement states what a retailer wants to be, its objectives state its measurable goals Objectives can be categorized as Market Objectives Financial Objectives Societal Objectives Personal objectives
It should be noted that the above categories of objectives are often in conflict with each other -- e.g. A goal of high sales volume is difficult to achieve with high sales margins
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Retail Objectives
Sales Volume Profitability
Market Share
Market Performance Objectives
Financial Performance Objectives
Productivity
Retail Mission SelfGratification
Employment
Personal Objectives
Societal Objectives Taxes
Power and Authority Status and Respect
Benefactor 02/01/12 JITENDRA KUMAR DIXIT
Consumer Choice
Equity
Image and Positioning
An image represents how a given retailer is perceived by consumers and others. Positioning Approaches Mass merchandising is a positioning approach whereby retailers offer a discount or value-oriented image, a wide or deep merchandise selection, and large store facilities. Niche retailing occurs when retailers identify specific customer segments and deploy unique strategies to address the desires of those segments rather than the mass market
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Selected Retail Positioning Strategies
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Target Market Selection Three techniques Mass marketing Concentrated marketing Differentiated marketing
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Strategic Implications of Target Market Techniques Retailers location Goods and service mix Promotion efforts Price orientation Strategy
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Societal Objectives
Social responsibilities are becoming more important The amount of social responsibility that comes from a true concern for society versus the amount that is triggered by the desire for positive publicity and promotion (Drug store health fairs) is unknown Societal concerns often are at the expense of financial objectives
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Personal Objectives
Self-Gratification - Owners, managers, and employees will probably choose working in a retail environment they enjoy Status and Respect - Managing a store or being an employee of the month adds to individuals status and self-respect Power and authority - Retail employment usually provides for more responsibility than factory employment
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SWOT Analysis
Strengths W - What competitive advantages Weakness do our competitors have over us?
es
S-
What competitive advantages do we have over the competition?
Opportunit T - What unfortunate environmental ies Threats
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O-
What favorable environmental trends exist that may benefit our firm? trends exist that may hurt our future performance?
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Retail Strategies
Get consumers into Store Convert potential consumers into loyal consumers Keep operating costs low while maintaining appropriate level of customer service
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Retail Strategies
Differentiate Physical difference of product Different selling process Post-purchase satisfaction specialized location never out of stock
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Retail Planning and Management Model
Competitive Environment: Behavior of Consumers, Competition and Channel Members Strategic Planning
SWOT Strengths Weaknesse s Opportuniti es Threats
Mission
Goals and Objectives
Social and Legal Environment: Socioeconomic Environment, State of Technology, Legal System, Ethical Behavior
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Retail Planning and Management Model
Competitive Environment: Behavior of Consumers, Competition and Channel Members Management
Retail Marketing Strategy Operations Management Buying & Handling Merchandise Pricing Advertising & Promotion Customer Services & Selling Facilities Administration of Resources People Information
Profit
High Performance Retailing
Target Market(s) Location(s) Retail Mix Merchandise Pricing Advertising & Promotion Customer Service & Selling ,Store Social and Legal Environment: Layout & Socioeconomic Environment, State of Technology, Legal System, Ethical Behavior Design
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Developing an Overall Retail Strategy
Controllable Variables:
Store location Managing business Merchandise management and pricing Communicating with customer
Uncontrollable Variables:
Consumers Competition Technology Economic conditions Seasonality Legal restrictions
Retail Strategy
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Factors to Consider When Engaging in Global Retailing
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Building A Sustainable Competitive Advantage
The final element in retail strategy is the retailers approach to building a sustainable competitive advantage. Seven important opportunities for retailers to develop sustainable competitive advantage are Customer Loyalty Location Human Resource Management Distribution & Information Systems Unique Merchandise Vendor Relation Customer Service
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Growth Strategies
Target Markets Existing New
Retail Format
Existing
Market Penetration
Market Expansion
New
Format Development
Diversification (unrelated/related)
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Market Penetration Market Expansion Format Development Diversification(unrelated/related)
a)Related Vs Un related Diversification b)Vertical integration c)Forward Integration d)Backward Integration
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