How Can Payless Company Increase Profits While Ensuring Current Customers are Satisfied - Essay Example

How Can Payless Company Increase Profits While Ensuring Current Customers are Satisfied? Recommendation: I recommend that Payless Company consider expanding more of its operations internationally, repositioning its products, and changing its name from “Payless” to ensure involvement of customers of diverse financial strengths. Short Term (Immediately-3 months) Putting more focus on the international sales Avoid over reliance on third parties for its survival Medium Term-(3 Months to 9 Months) Consider change of the name from Payless to something else that is inclusive of all customers. Develop an advertising plan that focuses on not only low income earners but also the customers with high amount of disposable income. Increased advertisement through social Medias such as Twitter, Facebook, and Pinterest. Becoming more trendy in terms of its items/products Long Term (9 Months to Extended Future) The company should accurately predict the future trends I recommend that the company expands its products and services to outside. The company should expand its children shoes. The company should also reposition its strategy through attractive packaging and pricing models that can woo the customers. Control and feedback The company should undertake survey to weigh on the customer feedback on its products. This can be done through promotions. Contingency Plan If the aforementioned recommendations are not successful, the company should merge with one of its smaller competitors such as Just Call It, and among others. Executive Summary Founded in 1956, Payless Company is the largest discount shoe retailer company in America. In 2003, Payless experienced its first loss in 5 years. The company is putting measures in place to ensure that there is increased sales and regaining the marketing leadership through strategies such as; expansion of its Brand Portfolio, The Payless Design Team, Designer Collections and An Image Overhaul. The company took a turn in establishing the new image of the luxury in meeting low-end prices. Although the company wants to continue maintaining its image of the low prices, the change mainly within Payless is to create the fashion goods by coming into collision with the designers to hit the marketing niche that was missing for all those years. Problem Statement How can Payless Company increase profits while ensuring current customers are satisfied? Recommendations: Short Term (Immediately to 3 months) Although the company is doing excellently on the domestic market, being aggressive on the international market will lead to increased sales and hence income. The company should actively market its products in continents like Asia that has large market base. However, the company should also embrace the domestic market as this can also lead to increased profits and positive publicity to the external markets. The reliance on third parties like New York –based designers like Stacey Bendet, Lela Rose, and Christian Siriano is risky for the company. The company should therefore move quickly to rely more on itself for survival. For instance, if the supplier lacks the required law materials necessary, it could harm the company negatively. I therefore, recommend the company to act quickly into rectifying this weakness. Medium Term-(3 Months to 9 Months) The company should consider changing its name from “Payless” so that it accommodates other customers with disposable income. Consumers with large amount of disposable income will not shop there regardless of the fashionable goods found there. Additionally, I don’t believe that it’s any cheaper than the other trend shops such as Just Call it Spring( subsidiary company of Aldo group). Increased advertisement through social Medias such as Facebook, Twitter, and others in order to keep their customers updated with the latest trends and collections. Social media is a valuable channel for ensuring that the company is maintaining a close relationship with its customers. The company should become trendier in order to attract trendy customers to purchase there. This will lead to the increased returns to the company. Developing an advertising plan that incorporates not only customers that are low income earners but also high income earners, this will lead to increased customer base something that can translate to increased sales and customer loyalty. Long Term (9 Months to Extended Future) Accurate prediction of the future trends by the company will help in averting the problems of decreased returns and closure of its branches as they will have timely on the changing trends and the customer tastes and preferences. The company will in addition make effective and efficient decisions in terms of its operations. Expansion of the company’s operations more to the international market will not only serve as a diversification tool but also will subsequently lead to the increased returns for the company. They can do this through introduction of new products to meet the diverse needs of the cultures internationally. The company’s current products are not majorly that of children. Its therefore advisable for the to consider concentrating more on the manufacture of children’s footwear as this will increase returns. Although the company has excellently done well in repositioning and pricing strategy. I still feel the need for the company to improve its packaging and pricing its products in a way that its not too low nor too high. This will attract diverse customer base and thereby leading to increased returns. Control and Feedback By undertaking survey, the company stands at a pole position in integrating customer needs into its production processes. Additionally, Payless will understand the customer needs and preferences, something that will play a critical role in introduction of its products into the market. Promotions can also be a good way of maintaining the customer relation and getting feedback. Contingency plan If the aforementioned recommendations are not successful, the company should consider merging with one of its competitors such as Just Call it Spring. I feel that this will be a favorable opportunity for the company to still remain in the market incase it’s in the verge of extinction and still retain favorable control. Reference Business Week. (2007). “A Shoe-Biz Success Story for Payless with new styles, higher sales and stronger margins, Payless ShoeSource is showing promise for investors”. Retrieved from http://premium.hoovers.com Read More