The internationalization of Cambridge Satchel Company - Essay Example

In this case of Cambridge Satchel Company the critical point was internationalization. In commerce, internationalization is the growing tendency of organizations to operate within national boundaries (Miozzo, et al. 2002 pg 13). The services and products of the business are designed so that they can easily be adaptable to different culture and languages. This is one potential strategy that is being utilized increasingly by organizations to increase profits margin, increase their market share, maximize their size, and become the industry leader. It is the core attribute to the ongoing strategy process of many business firms which determines the development that is going on and change in the international firm in terms of scope, values, business ideas, principles, action orientation, converging of norms and nature of work. All these aspects of process of strategy are related to the international dimension and thus the firm becomes ‘Transnational’. In the global competition, it is crucial for the firm to be transnational and internationalization process mainly focuses on the individual firm’s development on its integration, gradual acquisition, and use of knowledge about foreign operations and markets. The decision of internationalization by a firm is specifically to acquire profits (Newlands, et al. 2009 pg 35). The first internationalization of The Cambridge Satchel Company was the opening of the opening of the first physical store in New York at 31 James Street (Pola, et al. 2015 pg 63). The 3,239 sq ft opened on the 7th October 2014. Deane’s kids where her motivation to starting and internationalizing the business that she started with her mother in 2008 when she needed to raise adequate money to transfer her daughter who was eight by then away from bullies to a private school. All this was possible because Deane was a focused businesswoman. The Cambridge Satchel Company had just secured $21m of funding that came from Index Ventures, the venture capitalist that is backing the online fashion retailers Asos, Nasty Gay and Net-a-Porter as well as technology companies like Dropbox and SoundCloud. This was the first ever funding of the company and they had never taken on any debt either, although she was tight-lipped regarding how much was bought by equity index. It was not easy to give away a portion of the company, but after two years of careful thought. It took long for to convince herself that she could actually find somebody who could exactly was she felt was necessary for her brand. With the Index on board, Dean was now in a position to push ahead with her plans of turning Cambridge Satchel Company into a global brand even though she was already selling in more than 120 nations. At the end of June, the turnover the previous year was € 13m, and she was hoping she could double that figure in 12 months. She was so confident that in five years time, she would be so disappointed if the figure were not in the region of €70-80m turnover mark as she expected the internationalization to be very successful to the business. The process of internationalization begun by the company recruiting more people to join and she described it as the ‘lean senior management team’ and over areas such as marketing and technology. She also upgraded the company’s website so as to ‘reflect the brand, rather than just e-commerce’, and she heavily invested in upping production at their Leicestershire factory. Deane who lived in Chicago for five years with her American husband, was now ready to go global by opening the fourth store of her company in New York. She met with J Crew’s chief exec Mickey Drexler to hear what he was thinking about her plans, other than adding to the three in the UK. That a market she understood, through her husband, although she felt that he might not think she understood him particularly well after 20 odd years, she said. Dean’s family is the constant threat that that runs through the business. Freda Thomas, her mother, is still active in the company and, with Dean, owns the majority. She believes that her mum has the best common sense ever, and she could never underrate that fact. There was nobody she could trust more than her mother, when her mother supported her plans of internationalization, that’s what counted most to her. Moving her daughter Emily and son Max, at that time 14 and 12 respectively, to private school was ‘completely worth it’ she said. However, witnessing Cambridge Satchels developed from nothing to a company with over 100 employees and going global was ‘just as beneficial’ for them. She said that nothing seemed inaccessible to them. Something incredible was going to happen just because someone was focused and determined and kept on trying (Buckley, P. J. 2002 pg 85). Deane, went to Gonville & Caius college where she studied natural science, Cambridge (where she headed up their development team later on), prior to working as an accountant in their native Swansea, another motivation of internationalizing the business was to give chance of her children to follow her into business wherever they ended up. She believed they were the same to her; they are both quite awkward, so she didn’t know who else they could work for. Her son is happy to talk to journalist while her daughter is very diligent but doest like the publicity side of the business. Deane also pointed out that her experience of starting a business after a stay at home for eight years is among the things that also motivated her more to open a store outside her own country. This could show the women worldwide who are lucky enough to have that decision to make, to never be intimidated or be afraid of stepping out of the workplace for a while. She is very much a crusader of doing it yourself, emphasizing the fact that she never looked to the government “for a handout’. She actually avoided the many government agencies when starting out as it was not clear what each one of them did something that even the Federation of Small Businesses has echoed. She believed those were the attributes that facilitated the internationalization of her business. She was also effusive while praising the decision by David Cameron to including her and other bosses of small business on the trade delegation the previous year to China, a market where she saw potential for enormous growth and this was a possible choice for starting the internationalization of her business apart from the U.S. this was a fantastic opportunity to her, given that suddenly the market that they didn’t intend on going into has become accessible. She looks east for expansion, but she was adamant that her satchels will remain ‘Made in Britain’. Manufacturing the bags elsewhere was not an option as that is the key that she was going to utilize to be successful on the global stage. Having looked over the brink, Dean was aware of the success of her company. Following the Google ad that greatly widened their exposure, top people of the search giant were high on the list of individuals she wished to tell about the index investment before it hit the press. She messaged Google’s head PR, who casually told Eric Schmidt, the chairman while they schmoozed at Davos and the UK head of Google said the information had made his day (while at the dinner of Prince Trust dinner), a thing she said she could not believe. One thing that made the internationalization possible is that Deane was committed in keeping the company grounded and her bags relatively affordable as compared to her competitors’. Another fact that helped her in this journey was the you tube that has really exposed her product to the world. She said seeing the bags out and about really excites and has really marketed it in the global level; when you see individuals like, Elle Fanning, Sophie Ellis-Bextor or Alexa Chung carrying one of our products, for people to be in a position to have that similar bag, and request for it for their birthday or Christmas. Delta model is an approach that is customer based to strategic management. Compared to a focus that is philosophical on the product characteristics (product economics), the model is customer economics based. Dean Wilde and Arnoldo Hax developed the customer centered model(Hax, A. C. 2010 pg. 25). Arnoldo Hax proposed a set of principles known as Haxioms, which work as a frame work of the Delta Model conceptualization, and given that in a way it challenges the conventional wisdom concerning strategic thinking. 1) The customer is the strategy’s center. This is the Delta model center, being the customer the all actions’ driving force for the actions undertaken by the company. Therefore, the efforts that the organization do to configure propositions that are high value-added to customers which will be both creative and unique. In relation to The Cambridge Satchel Company, the idea of internationalization is basically to serve other customers that were attracted to the products of the business which they most likely learnt about through the internet. 2) You win through customer bonding and not by beating competition. As the center focuses on customer management, the central focus of the strategy should be the bonding with the customer. This stage is identified transparent relationship, fairness, and long term benefit for everybody. The Cambridge Satchel Company began from a very humble beginning and it is through establishing a very special and personal bond with its customers, has made them the big success that they currently are. They produce high quality products that the customers enjoy for long and in return they make their fair profit. 3) Strategy is Love, not war. Strategy is basically having a competitive advantage conflict is a way to think about business. We oppose this notion, our minds are opened to new alternatives and, because we are not in confrontation with our partners, other cooperation can be considered. Way that non-conflict is Love. 4) Mentality that is product-centric is constraining; the mindset should be opened to incorporate customers, the complementors and the suppliers as the key constituencies. Because all business are dependent and related on the members of the supply chain, a wider view is required to observe this expanded enterprise, which is the entity of importance in the analysis that is strategic (Hax, et al. 2001 pg 61). Hence we can better propose propositions that are high value to our customers. Our chosen company since its establishment has always incorporated its customers as this is also the core of its foundation; Deane shared a lot of blogs with her customers to get there feeling how they felt of any product and the type of products that they required. 5) Try to understand the customer well. Strategy is carried out one customer at a time. The resembling customer analysis in important to finish a sensible segment as it was witnessed in Cambridge Satchel Company success. Bibliography. Miozzo, M., & Miles, I. 2002. Internationalization, technology, and services. Cheltenham [u.a.], Elgar. https://books.google.co.ke/books?id=iCE66BoAUU4C&pg=PA161&dq=internationalization+in+business&hl=en&sa=X&ei=GJgmVc2tGMztapetgIAN&redir_esc=y#v=onepage&q=internationalization%20in%20business&f=false Polar, Z., & Goldstein, D. E. 2015. Rich as a king: how the wisdom of chess can make you a grandmaster of investing. https://books.google.co.ke/books?id=xfsEBAAAQBAJ&pg=PR4&dq=The+Cambridge+Satchel+Company&hl=en&sa=X&ei=p5gmVaqHAY7-aNaygIgB&redir_esc=y#v=onepage&q=The%20Cambridge%20Satchel%20Company&f=false Newlands, D. J., & Hooper, M. J. 2009. The global business handbook: the eight dimensions of international management. Farnham, Surrey, England, Gower. https://books.google.co.ke/books?id=QUVRK7JmOwAC&pg=PA10&dq=internationalization+in+business&hl=en&sa=X&ei=ZpkmVcKvFof7avWagMgK&redir_esc=y#v=onepage&q=internationalization%20in%20business&f=false Buckley, P. J. 2002. The Internationalization of the Firm. London, Thomson. https://books.google.co.ke/books?id=mc3uxTUVd44C&pg=PR19&dq=internationalization+in+business&hl=en&sa=X&ei=ZpkmVcKvFof7avWagMgK&redir_esc=y#v=onepage&q=internationalization%20in%20business&f=false Hax, A. C. 2010. The delta model: reinventing your business strategy. New York, Springer. https://books.google.co.ke/books?id=ROSTnjmTjxQC&pg=PA167&dq=DELTA+model&hl=en&sa=X&ei=ApomVYXfFIvgavf7gegB&redir_esc=y#v=onepage&q=DELTA%20model&f=false Hax, A. C., & Wilde, D. L. 2001. The Delta project discovering new sources of profitability in a networked economy. Houndmills, Basingstoke, Hampshire, Palgrave. http://public.eblib.com/choice/publicfullrecord.aspx?p=736047. Read More