Market Position of Harrods - Case Study Example

Executive summary The Harrods Company is a reference to a successful plight of business in the face of London. It is a company that is based on the luxurious combinations of the best world class financial performances of the retail properties. The store has got a wide and vast selection of goods and services that surpass the desires of the various arrays of customers within London in the United Kingdom. The company was found into place during the year 1834 when it offered the world class range of products for luxurious goods (Humphreys 28). The extensive and exclusive company combines into place a culture for which it redefines the beauty products. The stores of the company thus offer out various beauty products and fragrances. Alongside these, it gives into place products such as handbags and other accessories as well as the men’s and women’s wear. With these items, products such as the assortment of decorations and the luxurious television sets and wines and spirits find a place in the stores of this company. This company also conducts events and also operates restaurants within London. As such, the company also offers a wide range of branding of products alongside conducting an online sale of products. The Harrods Company also conducts business and sale in the Far East side with a motto that is profoundly put as Omnia omnibus Ubique which means that all things for all people everywhere. This marks the global attention that the company has got over the years to its establishment. Introduction The Harrods Company simulates a fully owned subsidiary that is within the Harrods holding group of companies. The Harrods Company and its subsidiaries essentially are involved in the retailing of products in the United Kingdom. The company actually operates the departmental store that is situated in the city of London. The activities of the company are as such globally recognized through the customer research that is aligned into the company. The online shopping for the company creates within it a clientele that holds brand strength with large market dynamics and proper programs of sale. The Harrods store boasts to have a passion for the luxurious goods and the high level of success in the cultural ties. Its relation to England and Boston is an inspiring intent of incomes and exclusive merchandise that has got a strong aesthetic feel. The objectives of the study of Harrods Company are to apprehend the size and the nature of the finances and the competition within the company especially with other luxurious traders (Derdak 43). In order to accomplish this, the paper shall evaluate the impact of the United States economy especially on the demand of the luxurious goods among the customers. Findings Market position of Harrods in relation to other six competitors The Harrods store is an occupant of almost all the products that are sold in the United Kingdom. The United Kingdom departmental stores bring out the structure of the market position of Harrod Company. In essence, the Harrods, Selfridges, Debenhams, house of Fraser, Harvey Nichols, john lewis, mark and Spencer are among the competitors of this company. The Harrods market position increased in the year 2004 due to the fact that the performance of mark and Spencer that was the then leader in the market went down. However, the competitor marks and Spencer was brought back in the year 2006 to reconvene the market to grow within a range of 4.7% (Dale, Tim, & Fayed et Al 172). The market performances brought in by Harrods, Selfridges and Harvey Nichols, however, came about as very vital to bringing back the initial market solutions. Currently against the six competitors, Harrods Company is seemingly the largest of the market revolvers in the country operating at extremely high profit margins. The Harrods Company has achieved this position through the constant operation and utilization of its space rather than the constant opening of stores like its competitors. The consumers have also contributed to the market position of the Harrods Company with the close reference of the economic regime (Jones 54). The consumers are able to select exactly what to consume and require a high ended indulgent shopping experience. This is usually offered by the Harrods store as compared to the other competitors who specialize in one line of products. This has thus put the Harrods Company first among its competitors hence giving it an edge over the market share indices. Financial performance of Harrods in relation to the SIX MAIN competitors The Harrods stores happen to carry down various leading designers in their line of sale of products. In this case, the profits of Harrods as compared to the other stores tend to keep rising as opposed to the profits of the other stores. Of the six other departmental stores, the Harrods store reclaims out the biggest record of operational profits followed by the Selfridges store. The Harrods departmental profits in the year 2007 were increased by 30%while that of Selfridges was increased by 16% (Kleber 123). The departmental store owners of marks and Spencer and Debenhams and john Lewis alongside the house of Fraser are currently way below the profits ration of the Harrods Company. Usually the dividends of the Harrods Company are drawn through the Harrods holdings. The Harrods stores have thus benefitted a lot from the presence of the overseas shopping. This is especially since most of those who shop are visitors away from London. As such, currently the sales of Harrods are up by 4.7% as compared to the previous years (Epstein 231). External economic factors which may influence the companys position and financial performance in the future The shopping strategies and the behaviour of consumers are part of the reasons as to why the position of the company and its financial position may be different. In essence, the impact of the economy on the consumers is one of the factors that would affect its performance in the future. For instance, the economy within usually affects the behaviour of shopping within the environs of the company. With the economy being unfavorable more consumers tend to shop less of the goods while others tend to look at price tags and evaluate the viability of their shopping decision. In the future if the economy goes down, the company is likely to hike its prices in order to keep up the external heat. The structural state of the economy shall revolve the anticipated maximization of the market share while minimizing all the costs on their side. As such, the company’s rank may somewhat go down since it has got a centralized design of business, unlike the other competitors. Again the external factor of the social viability in the society may affect the position of the environment of the company (Quiry, Pascal, & Pierre 78). The factors of cost and the custom of wealth and income of people may create a dent in the shareholding capacity of the economy. The essence of the plight of the goods of the people is a code of conduct for consumers to buy out fewer commodities. The shareholding capacity of the people might go down since most of the people may wish to sell out their shares instead of retaining them. This will thus affect the financial structure of the company since the market share prices may as well go down thus putting it at a lower rank than its competitors. The political and the legal environment of the business are another external factor that may affect the market position of the business. The intensity of the pact of importation and the influences of licensing policies would affect the company in the future. For instance, the government policy to decentralize production to other countries would affect the Harrods Company. In essence, the company holds most of its stores under one roof. A policy to decentralize would creep out into the company creating a dent in its market share. On the positive however, the decentralization would improve the profits ratio of the company creating a higher and a vast range of customers to the store. Further, the perception of the products of the store would be another factor that changes the market position as well as the financial position of the store. The survey of the customers’ experiences and the glamour within the perception of the products makes all the difference (Stackelberg 59). The females are more inclined to the products of the Harrods Company and hence creating an edge to the market position of the company. The profit ration thus is on the increase towards the brand accessibility of the company’s products. This in the future boosts out the economy and the general attribution of the financial performance of the economy. Conclusion The Harrods Company has got a verifiable concept in the positive reactions of the individual stores. The concept of the departmental fragmentation of stores is appealing to many consumers due to the uniqueness of the products and the luxury there is. This means that the Harrods Company is indeed a company for everyone and, the number of the departmental stores is a plus to the company’s profile (Saxena 77). The intention of making purchases values out the quality and variety provided by the store to the consumers. The company should thus maintain its biannual sales and, as such promote the shoppers. The company should as such consider high ended advertising in order to bring out the brand awareness and establish a difference in the competition of the other departmental stores (Nel 67). The audience that is appellant to the Harrods Company is favorably that with a luxurious intent and capitalizes on the participatory future research ideologies. Proper and further research on the market index and the performance of the company against all other odds should be done in order to make the company a better partner within the exclusive realms of the store locations and the target audience. References Derdak, Thomas. International Directory of Company Histories: International Directory of Company Histories. Chicago: St. James Press, 1988. Print. Dale, Tim, and Fayed M. Al. Harrods: A Palace in Knightsbridge. London: Brompton Press, 2003. Print. Kleber, John E. The Encyclopedia of Louisville. Lexington, Ky: University Press of Kentucky, 2001. Print. Humphreys, Rob. London. London: Rough Guides, 2003. Print. Nel, Wilhelm. Management for Engineers, Technologists and Scientists. Cape Town: JUTA, 2006. Print. Epstein, Marc J. Making Sustainability Work: Best Practices in Managing and Measuring Corporate Social, Environmental and Economic Impacts. San Francisco: Berrett-Koehler Publishers and Greenleaf Publishers, 2008. Print. Quiry, Pascal, and Pierre Vernimmen. Corporate Finance: Theory and Practice. Chichester, West Sussex, U.K: Wiley, 2011. Print. Jones, Geoffrey. Merchants to Multinationals: British Trading Companies in the Nineteenth and Twentieth Century’s. Oxford [u.a.: Oxford Univ. Press, 2000. Print. Stackelberg, Heinrich . Market Structure and Equilibrium. Berlin: Springer, 2011. Print. Saxena, Rajan. Marketing Management. New Delhi: Tata McGraw-Hill, 2009. Print. Read More