Strategic Plan: Baby Store - Essay Example

Strategic Plan: Baby Store Mission Statement of Baby Store: Baby store is a brand committed to deliver value. The goal of the baby store is to cater the baby care provider's needs with quality products at minimized prices. The foremost priority of the store is to provide quality to its customers. The food products offered at the store are nutritious and specially formulated according to the needs of infants and children. The Fabrics need to be soft in order to saver the baby's gentle skin from irritation. The customers do not have to spend a great amount of money to be able to care properly for their little one. 1.2 Objectives: The store’s broad objectives are: • To increase customers by a policy of communication, public relations, and collaboration. • To make use of the new technologies this will help the store to innovate new products of reduced prices and improved quality. • To ensure customer retention through ensuring quality of products and consistent, steady revenue, guaranteeing development and progress. Situation Analysis In order to analyze the marketing and strategic situation first of all SWOT analysis have been under taken, which has been presented as under: SWOT analysis enables the organization to plan and execute its program of action with a degree of certainty about the external environmental factors that influence its own existence. A baby store would necessarily be faced with a number of external economic influences such as the government policies on taxation, interest rates, inflation, money supply, balance of payments, Gross Domestic Product, National Income, foreign governments’ protectionist policies and so on. Imported baby-care products would be more expensive if the government imposes a higher import tariff on them. The government might impose higher corporation taxes in order to control inflation. This would affect the business in a number of ways. For instance a baby store which depends much more on imported products would find that higher tariffs to be a threat to its survival, especially in the long run. It might find it difficult to reduce prices to match its rivals’ prices. Rivals might be selling domestic products that are not subject to taxes except some GST or BTT. This gives them an advantage over rivals that sell imported products. Higher sales taxes imposed on baby care products by the government in order to control inflation also could affect them. Baby stores are affected by such taxes because now people buy less (McIntyre-Mills, 2004, p.373). Technological developments also influence businesses. A baby care product seller could be influenced by such developments in technology as irritation reducing skin lotions and mild shampoos. Also the baby food market, for instance, has been converted into a battleground for technology giants. Subtle discoveries, involving immunity enhancing or/and disease fighting biological agents, have revolutionized baby products markets. New technologies represent opportunities for baby stores. Competitors, who lag behind in introducing such new technologies or fail to sell products made by using new technologies, would be forced out of the market sooner than later. This is all the more obvious when demand and supply forces in baby product markets are taken into consideration. Demand for products with advanced features is much greater even if the price is little higher. On the other hand suppliers tend to project future sales partially on the basis of current technology trends. Strategic processes and systems within the organization involve all management functions and corporate decisions. A baby store would have to initiate its strategic functional processes and systems in keeping with its own strategic competitive environment as determined by SWOT analysis. A baby store has to face more threats on a day-to-day basis from its rivals so that efficient resource utilization and rationalization to enhance capacity would be much more desirable form the viewpoint of strategic competitive strength. Rivals depend on their brand image and promotion strategy to increase sales while much of their competitive edge consists of pricing and quality policies. Consumers of baby products are often influenced by exogenous variables like professional writing on current baby care trends. In this backdrop the baby store should be able to manage its resources more on line with a ratio perfect basis such as resources spent per sale. Strategic marketing capabilities coupled with brand loyalty of customers, help baby stores to position themselves in the market at an advantageous level vis-à-vis their rivals who might lack such capabilities. However, baby stores do not always enjoy benefits related to brand loyalty due to the inevitable outcomes related to consumers’ incomes and tastes. Low income consumers are influenced more by prices and less by quality. Finally competitive strength of the organization is determined by its corporate strategies including the marketing strategy (Stone and Jacobs, 2007, p.23). SWOT Analysis of Baby Store STRENGTHS Variety of products. Presence awareness despite the lack of proper marketing – Marketing Department. Enthusiastic staff Good relations with local media WEAKNESSES Lack of marketing department - marketing efforts No relevant researches regarding store's competitiveness Lack of proper space and exposure. Lack of online presence. Lack of proper parking area OPPORTUNITIES Major national trend of promotion and introduction of cultural activities related to conservation and heritage issues More people moving into area Computer technology for promotion purposes THREATS Current economic climate, e.g. Announcements by the Greek government for financial reforms with negative impact to middle and lower social classes’ income Imposition of regulations from Government. Results to be achieved in future can be less than projected The balanced scorecard is an extension of traditional financial measures. In the modern technological age only financial measures are not adequate. In order to remain competitive and successful in business it is important for a business to create future value through investment in customers, suppliers, employees, processes, technology, and innovation."  (Balanced Scorecard Institute, 2009)  Adapted from the Balanced Scorecard by Kaplan & Norton Shareholder Value or Financial Perspective: a. Market share: Increase in customers by 25%. b. Revenues and costs: Increase in revenue by 10%. c. Profitability: Increase in profitability by introducing just-in-time inventory system. d. Competitive position: Gain higher level of market share by offering lower prices than competitors. 2. Customer Value Perspective: a. Customer retention or turnover: To improve customer loyalty by introducing membership card. b. Customer satisfaction: Improve level of customer satisfaction by introduction of customer feedback program. c. Customer value: Continuous customer support through online and telephonic support. With the changing business attitudes a need of rebounding between the customers and the business corporations is also felt. The call centers are seen as an important instrument in order to explain the sales executives what is being required by the customers in shape of products and services and hence improving the sales by targeting the actual requirements of the customers. The following advantages are attached with the use of call centers Greater corporate flexibility, increased sales, Happier customers. 3. Process or Internal Operations Perspective: a. Measure of process performance: 1. Composed of quality professionals and team chairpersons, quality councils should meet regularly to share experiences, problems, and ideas (Ross, no date available, p. 6-7). b. Productivity or productivity improvement: There must be a continued effort to improve all business and production processes. Quality improvement projects, such as on-time delivery, order entry efficiency, billing error rate, customer satisfaction, cycle time, scrap reduction, and supplier management, are good places to begin technical techniques such as SPC, benchmarking, quality function deployment, and designed experiments are excellent for problem solving. 4. Learning and Growth (Employee) Perspective: a. Employee satisfaction: Employee involvement should be encouraged on every step of organizational planning, from decision making to implement change in the organization. A program can be found effective when the employers guarantee the involvement of the employees at each and every step. The employers should encourage the involvement of employees in all the processes effecting the work place situation and the well being of employees. b. Employee turnover or retention: People must come to work not only to do their jobs, but also to think about how to improve their jobs. People must be empowered at the lowest possible level to perform processes in an optimum manner. There must be a continued effort to improve all business and production processes. c. Level of organization capability: Quality improvement projects, such as on-time delivery, order entry efficiency, billing error rate, customer satisfaction, cycle time, scrap reduction, and supplier management, are good places to begin technical techniques such as SPC, benchmarking, quality function deployment, and designed experiments are excellent for problem solving. d. Nature of organization culture or climate: In the highly competitive environment of the business in today’s high pace changing business environment enhancing the learning capabilities of business is the solution of half of the problems (Prahalad & Hamel, 1994, p.199). e. Technological innovation: As there are higher threats of increased taxation the business should try to invent technology which can reduce the production costs in order to keep a breast with the challenges of increased costs. Long Term Objectives: After achieving short-term goals, the vision of strategic plan will be enlarged to the long-term goals, which are as follows: SMART Objectives for the Baby Store Objectives Activity Time Scale Required Responsibility Promotional Objective: Improvement in promotion by introducing new methods. 1. By implementing Web based advertising. 2. By sending e- newsletters. 3. By using the relationship with media more effectively. 4. By hanging billboards on important educational places March 2010 Marketing Staff Market Share Objectives: Increase in customers by 25% 1. By using aggressive marketing techniques. 2. By gaining knowledge about the competitors steps through continuous research 3. By continuous performance evaluation and improvement. 4. By introducing new services. June 2010 Management & Marketing Staff. Profitability Objectives: Increasing revenue for 30-35% 1. After gaining promotional and market share objectives. Increase in profit to be attained by continuing above-mentioned tasks. 2. By introducing new and attractive products for infants and children. 3. By improving the outlook of the store. June 2010 Management and marketing Staff. Plan Control Procedure The baby store for the first time will launch a planned marketing campaign in its history. The campaign will constitute all the marketing techniques strategically in order to minimize the cost of the marketing campaign. A specially designed label will appear on each and every product and in the print and web based ads. The advertisement campaign will include direct mailing, ads in magazines and newspapers, advertisements on Internet and promotional emails. The above-suggested advertising channels will help the best to convey the message of the baby store management to the masses. To deal with the changing situation of the market and consumers inferences the marketing plan needs to be monitored and controlled. For the baby store it is recommended to use annual plan control. The annual plan control is undertaken through setting small term objectives. The management should keep on analyzing the performance in the market place. If there is deviation in the performance from the goals specified in the annual plan the reasons should be analyzed. To check the plan performance market share analysis and expense to sales analysis should be undertaken. Through using market based score card two purposes can be served. 1) Evaluation of actual performance of company. 2) Provision of early warning signals. The customer performance scorecard will use the analysis of following in order to analyze the performance of the baby store. It will measure increase in the new customers. Number of lost customers. Quality of services provided. Quality of products presented. Right awareness of target market. The preferences of target market (Kotler, 2000, 696). REFERENCES Balanced Scorecard Institute, (2009). Balanced Scorecard Basics, retrieved 13 February 2009 from http://www.balancedscorecard.org/BSCResources/AbouttheBalancedScorec rd/tabid/55/Default.aspx Kotler, P., Marketing Management, Millennium Edition, Prentice Hall, 2000, United States. McIntyre-Mills, J. (2004). Critical Systemic Praxis for Social and Environmental Justice (Contemporary Systems Thinking). New York: Springer. Mello, S. (2003). Customer-centric Product Definition: The Key to Great Product Development. Massachusetts: PDC Professional Publishing. Prahalad, C. K., & Hamel, G., (1994). Competing for the future, MA: Harvard Business School Press, pp.199. Ross, J. E., (no date available). Total Quality Management: Text, Cases and Readings, Second Edition, Florida Atlantic University, Boca Raton, Florida, pp. 1-3 Stone, B. and Jacobs, R. (2007). Successful Direct Marketing Methods, 8th Edition. New York: McGraw-Hill. Read More