External and Internal Environmental Analysis For Barnes and Noble - Term Paper Example

? Introduction Barnes & Noble Inc. regarded as a fortune 500 company is one of the largest book retailers created form thebasic ideas of Charles M. Barnes; who started the business with a small printing establishment in Illinois in 1873. The company merchandised in textbooks and scholarly books and became famous in the whole Manhattan and New York, but with the increase in fame, came the need to meet the high demand. This prompted Leonard Riggio, one of Barnes & Noble competitors into buying the company in 1971 and later transforming it into the world largest bookstore; the famous name it earned until to date (Morgan, 2010). Having attained the highest success rate Riggio decided to expand it again through incorporation of a broader selection of commodities, which has seen the Barnes & Noble Company’s expansion all over the United States with accomplishments in the internet e-book services, shipping and mailing systems. The company has recorded remarkable sales turnovers, but they still fail in the area of conforming to the environmental impacts of the market. Therefore as part of sourcing out a long-lasting solution and defining the future of the company, the management has to carry out an external and internal environmental analysis for the company (Barnes & Noble, 1997). The success of this analysis relates directly to the strategic plan that the company formulates and puts into practice; which forms the basis of this paper that seeks to plot out a workable strategic plan for Barnes & Noble Inc. Strategic Business Plan for Barnes & Noble Inc ____________________________________ This document comprises a strategic plan, for Barnes & Noble Inc... It reflects on the company's SWOT presenting fundamental suggestions relating to Barnes & Noble core values and objectives; with the aim of implementing a workable strategic plan of action and accomplishment of future company goals. ________________________________________ SWOT This strategic plan reflects on significant Barnes & Noble strengths, weaknesses, threats and opportunities, (Morgan, 2010) that apply to Barnes & Noble Inc. now and in the near future: Strengths: A large company offering a wide range of products ranging from books, music, videos through online stores. The company has the best locations characterized by their excellent choice of location, for example, in cafes like the Starbucks. Through the high success turnover rate, they enjoy the capability of having enough capital for expansion. They have a wide clientele base emanating from the extra program such as the children book club and the publishing programs Since the company bases its work on creativity, they attract the biggest clientele number of Americans who value art. The technological advancement and the increased need for a computer literate generation boost the numbers of clients that utilize the company’s eBook service benefiting company in return. Strong team to lead and manage the company. Growth of the online product. Added equity when it comes to the brands. Stable financial position. Weaknesses: They have the highest internal operating costs due to the many locations they have opened their stores. Sluggish in keeping up with the divergent change in issues and trends. The company lacks proper preparedness when it comes to dealing with change and competition. Diseconomies of scale. Over estimated economies of scale. Weak chain of managers. Threats: The competition from other online libraries and online businesses such as the Amazon. The economy that continues to slow down. External changes such as the politics, the government and taxes. Existence of cheap but effective technology.. Competitors who offer low-cost products The rampant growing product substitution such as the eBooks. Fluctuations in exchange rates. Competition. Conflicts relating to the varied competitor prices. Opportunities: A rich marketplace because of their a unique business strategy of penetrating the most profitable markets; selling scholarly books, movies, textbooks, coffee, eBooks and even publishing books themselves. They have a higher asset leverage compared to any other competitor. High product and service expansion. Existence of emerging markets and abroad expansion. Financial markets. Available avenues for business acquisition. Equity in asset acquisition. Innovation of the existing products. Takeovers. Vision The promoters' vision of Barnes & Noble Inc. in 3-4 year's time is: The business plans to expand its clientele base through the introduction of new and unique products that will put a competition gap between the company and other potential competitors in this field. In the coming four years, the business will have an increase in annual turnover based on adequate preparation for change and customized legal rights for publishing books, different from that of its competitors (Morgan, 2010). Mission Statement The central purpose and role definition of Barnes & Noble Inc.: The business has concentrated on the lines of book publishing, movies, books and online selling of books, but the future calls for change. Therefore, the company will open out its product line by; developing the top most quality of the existing products, increasing the percentage of the legal rights bought from the best booksellers who employ the nook type of kindle in eBook selling. The business plans to offer eSpanish books among other books that will give more customers a variety to choose from and by so doing Barnes & Noble will ensure they stay competitive through expansion of locations. This is because different locations have different competitive advantage and legal rights that the company can maximize to increase their profit margin (Morgan, 2010). Corporate Values The corporate values governing Barnes & Noble Inc.'s development will include the following: Customer service; we strive to personalise customers needs and satisfy their individual demand a separately despite having a large clientele base. Quality; we aim at providing the best-desired results in the specified timeframe because this reflects on the company's mission. Respect; we treat the company's competitors and customers with respect. Integrity; this reflects on the business and personnel we commit, follow rules and give the best effort to satisfy the customer. Responsibility; to achieve the best result we willingly assume extra accountability for the company's actions. Teamwork; we nurture open communication and active personnel involvement through modelled behaviours and group support. Business Objectives Longer-term business objectives of Barnes & Noble Inc. in summary: Since the company has expanded widely into the U.S. we purpose to institute and extend long term partnering relationships with other publishing companies, in a bid to open out on market shares to other potential shareholders and increase our margin in the capital market. Key Strategies Barnes & Noble Inc. Intends to follow the below stipulated critical strategies: 1. Incorporate digital application s into the eBook service for online customers. 2. To further expand their locations in an effort of evolving the superstore idea. 3. Add more appeal to the stores at cafes, for example, through the addition of popular coffee brands. The company will implement the following principal strategies (Harris & John, 2008) : 1. Concentrate on real marketing and merchandising; the key starters for the expansion strategy. 2. Refine the superstore concept of business into modern business generation. 3. Acquire more local bookstore chains and transform them into the company’s chain Major Goals Barnes & Noble Inc. will achieve the following key targets over the next 3-4 years: Through the expansion, of ours bookstore location, we focus on increasing the company's legal rights globally by employing the nook and closing in on the foreign market; to bring our products closer to the customers. Additionally the new marketing strategy bases on manipulating the online service to provide efficiency and quality product in operations as well as satisfy the personal needs of our own employees through technological advancement (Barnes & Noble 1997). Strategic Action Programs The following strategic action programs will undergo implementation: Increasing the investment towards the collaboration and advancing of the publishing program. Initiate innovative programs to change the current product into better quality for customer’s satisfaction and further open up economies of scale through surplus management and commodity customization despite the variety (Harris & John, 2008). Summarily all the above action programs need implementation in a four year period span considering the quality management of the superstore expansion program, as well. Bottom line The company needs to put a scrutinized focus on the customers needs, but for the plan to work effectively, team building and cohesion should be the practical exercise in implementing this strategic plan. References BarnesandNoble.com world's largest bookseller online. (1997). S.l.: Barnes and Noble.com. Harrison, J. S., & John, C. H. (2008). Foundations in strategic management (4e [ed.] Ed.). Mason, OH: Thomson/South-Western. Morgan, K. (2010). Barnes & Noble: groundbreaking entrepreneurs. Edina, Minn.: ABDO Pub. Read More