Retail Marketing: John Lewis Company in the UK - Essay Example

?Marketing Retial Marketing (John Lewis Company in the UK) Topic: Retail marketing (John Lewis Company in the UK) Reason for Choosing the industry and retail organization; Retail industry is the subdivision of economy which comprises of trade of finished goods to the end user. The industry is expanding at a considerable rate globally. The reason behind the fact is growing awareness of the consumer and amplified competition amongst the market leaders. The industry is suitable for exploration as it conceive direct impact from consumer part as well as from market and macro environment. The retail organization selected for this project is “john Lewis company”, which holds a significant position in the retail industry of UK. John Lewis Company: The beginning of John Lewis Company took with the establishment a shop in London Oxford Street in 1864. At present, the successful voyage of the brand has won the place of largest departmental Store of UK with the mass of 35 shops. The company possesses a unique strategy to invoke enthusiasm in the work force by offering partnership to the employees to cultivate ownership in their attitude. The culture and spirit of the business is embedded in this very strategy that steer business operation with a common shared vision. In particular, the business strategy revolves around the establishment and strengthening of three elements that includes partners, customers and profit. Impact of Macro Environment in retailing; As mentioned above, macro environment plays a vital role in retail industry. Hence, a rational evaluation of the relevant factors to turn and cultivate positive opportunities is essential part of operations management. The force that renders considerable impact on the business can be categorized and elaborated with PESTEL analysis. PESTEL Analysis of Macro Environment of UK Retail Industry; Political; political implications are always crucial for retail industry as they are the grounds of legislation with negative or positive side effects. In the previous era of recession, UK retail industry was greatly affected in terms of finance and operation. Forecasted political Impact on retail activity; The year 2012 is expected to bring in positive changes with the new prospected coalition government. The most prominent impact is expected to be drawn with the budget statement that plans to drop the borrowing requirement from 11.0% (2009/10) to 1.1% by 2015/16. Although it is expected that the target will be attained through a rise in VAT and Capital Gains Tax but the impact on UK retail industry is not expected as dramatic because of the reason that the very implication was expected since long. Economical; The economy of a country directly influences not only the buying patterns of consumer but also the production to meet demand. However, it is the most critical a role of operations management in retail industry to determine the demand with a functional supply chain to uphold the goodwill of an organization. Forecasted economical Impact on retail activity; although is quiet an evident fact that there is no standard formula to forecast economical viability. However, due evaluation of stressors can constructively aid the operations management to plan the strategical objectives. Concerning the previous era of recession, a sudden uplift of economy is not expected. Even though a minor improvement in the situation is expected. This may be utilized by retail industry of UK to bring in new opportunities to the sector. Social; The impact of social status can be identified in terms of ageing population, attitude to work and income distribution etc.. It determines the social trend of a country towards consumption, likeness and vice versa. Impact on retail activity; The previous era of recession have globally altered the social conditioning with massive consequences. In order to conjure them positively in the coming period minute observation with practical solutions to turn away threats and opportunities into strengths is a necessary element for effective operations management. Technological; It refers to the advancement of technologies in the sector. In the present age of massive competition the race of excellence can only be prevailed on the ground of advancement in technology to hold a leading edge from the rest. Impact on retail activity; Innovation and advancement is rapidly posing new challenges to industry. The most obvious an example is the shift of buying pattern towards online shopping. Therefore, it must be mentioned that technological modification in mechanics with the innovation in management tactics has the potential to forcefully lead the business market towards successful achievements. Environmental; The environmental issues that impact the function of retail segment can be categorized into the physical impacts like global warming and factors that influence competition, buying patterns, employment standard and demand and supply etc. Forecast of environmental Impact on retail activity; The stability in recession with a slight improvement in the economy is expected to bring in positive opportunities for the sector. It can be stated that a rational strategy can cultivate new dimensions for the success of retail segment in UK. Legislative; It refers to the impacts of laws (direct / indirect) imposed on retail industry from government policies, rules and regulations such as labor law, health and safety policy etc. Impact on retail activity; The most eminent an impact of legislation can be studied in the shape of VAT increase that will eventually bring in inflation, increase cost and price, reduce the sale and will eventually hit the economic growth rate. Current Issues in Retail Industry; A concise review of the information makes it evident that the year 2012 will be decisive for the global retail industry. In order to come up with suspension of recession in a quality manner certain threats and weaknesses are to be rationally planned to grasp efficacy. The retail ethics needs to be altered in the light of social duties to encourage greener retailing. To promote constructive changes in consumer life style with modernism, to explore new methods and processes for saving energy, to control retail crime and hidden losses with technological modifications and to focus on online retailing. In conclusion, environmental factors have the prime impact on the operations management of John Lewis Company which demands rational evaluation to summon the post recession era. The chief elements to be considered in this regard can influence the organization in a number of ways as depicted below. The competitors of retail industry may avail the opportunities which can drag down the reputation of organization. Hence, John Lewis not only needs to sustain its position but needs to acquire a leading edge to cope up with the peer pressure. Like most of the big organization, John Lewis also operates on credit from suppliers. These suppliers have limited capacity of production and will certainly prefer the organization with greater brand name, reputation and market share. Thus, smooth execution of operation management is only possible when John Lewis prove it capable to deal with economical pressure. Customers; Regular efficient goods and services is obligatory to seize customer loyalty. In case, the competitor provides a better product or service the very loyalty will shift toward the competitor. In short, high level of product and service is essential to be maintained for keeping the excitement alive from the perception of customers. Recommendation; UK has the rate of the highest online share in retail industry, in this reference John Lewis Company should focus to improve and enhance the facility of online trade and sales with a strong IT Management. In addition, assortment of the year needs to be studied and adjusted to determine the ins and outs in a number of ways. Cost reduction with the introduction of “grades’ in inventory by offering different qualities with reasonable rates can further encourage the traffic in John Lewis Company. The packaging can be restricted with greener approach to further instill the sobriety in trade. In addition, an advanced social media policy is suggested which will bring a positive impact on the media relations and will aid to establish the image of the company progressively. The actions will aid the company to win consumer confidence with the cultivation of good will. I other words, the decisive era can also determine the new image of John Lewis Company with minute strategical plans encompassing the core concerns. Precisely, in order to come up successfully John Lewis needs to determine a solid competitive edge to respond emerging issues of contemporary era. However, along with the suggested actions an effective CRM is the other essential need to bridge the gap between the company and customer. References; CRR. nd. Retail Forecast for 2011-2012. [online]. [Accessed 13 January 2011]. Available from World Wide Web: CRR. nd. The VAT Increase. [online]. [Accessed 13 January 2012]. Available from World Wide Web: JLP. 2012. Our strategy. [online]. [Accessed 2012 13 2012]. Available from World Wide Web: OUP. nd. PESTEL analysis of the macro-environment. [online]. [Accessed 13 January 2011]. Available from World Wide Web: Read More