Integration Strategy Plan for the Mayer Company - Case Study Example

Management Report Name: Management Report Course: Tutor: Institution: Date: Dear CEO, With respect to your request that I develop a research analysis on the company’s alternative future development strategies, I hereby submit this report. The report offers a strategic evaluation on the possible company development alternatives offering the key goals, plans and tactical approaches for each of the three discussed strategies. I believe that the report will suffice the intended purpose. Table of Contents Table of Contents 3 2.0 Forward Integration Strategy 4 2.1 Strategic Goal 4 2.2 Strategic Plan 4 2.3 Tactical Actions 4 3.0 Target the Low End Consumers 5 3.1 Strategic Goal 5 3.2 Strategic Plan 5 3.3 Tactical Actions 5 4.0 Develop a Strong Brand Image 6 4.1 Strategic Goal 6 4.2 Strategic Plan 6 4.3 Tactical Actions 6 5.0 Conclusion 6 References 8 Appendices 9 Appendix 1: Myer Company SWOT Analysis 9 Appendix 2: Myer Company Porters Five Forces Model 10 1.0 Company’s Background The Mayer Company has over the years established an increasing market reputation for quality and reliability in its products offerings. In this case, the organization’s products proposition that seeks to serve the Australian retail industry, especially the middle and high end middle classes has earned it its current market reputation and status. However, despite the organisations vision and strategic objective to exerting control and expanding its market share in the Australian market, market changes might alter this objective achievement. As such, this review analysis seeks to support your decision making model by offering you with strategic management alternatives based on the organisation’s SWOT and Porters five forces model analysis tools; all attached under the report appendix section. The report responds to the growing need for the organisations to adopt differing and unique timely new strategies to counter the forecasted market changes proactively. 2.0 Forward Integration Strategy This strategic recommendation is based on the existing market distribution challenges. Although the Myer store outlets in the Australian have been strategically and robustly been positioned and expanded respectively, the challenge of reaching out the extreme market ends, that the organization has not yet reached out to. 2.1 Strategic Goal The strategic goal for the establishment of this strategic approach will be based on the role and need for the respective outlets to reach out to the entire Australian industry market base. In this case, as Rangarai, Raghuram and Srinivasan (2009, p.8) argued, distribution plays a crucial role in the success and increased market performance for respective organisations. As such, the author stated that through an expansive organizational distribution process and infrastructure, customer loyalty as well as an organisations products proposition offerings successfully reach out to the desired consumer base. Therefore, based on this review, the Myer organization should develop a strategic goal of expanding its distribution base and presence through the application and adoption of forward integration strategies, which include the establishment of market, based strategic alliances with key established and strategically positioned distributors. 2.2 Strategic Plan The strategic plan under this strategic execution for the venture would be the ultimate development of forward integration relationships. In this case, the management plan should be designed to allow for the identification, evaluation, appraisal and the eventual selection of the ideal distribution partner that the retail venture can partner with (Cant, 2006, p.396). Moreover, the strategic plan should also encompass tools such as the partnership venture management approaches, communication channels and frequency as well as the intervals and relevant tools through which the partnership success rates would be evaluated and established. 2.3 Tactical Actions In order to successfully execute and establishes the desired industry forward strategic alliances, this report recommends that the management should Conduct research to establish the Australian geographic markets in which the venture has no retail outlets. Conduct an extensive survey evaluating the existing industry distribution organizations that the form can partner with. In addition, the venture should appraise the various listed organisations based on the relatedness in vision and, mission statements as well as market and consumer shares respectively. Further, the venture upon a merit based selection of the ideal partner should develop a benchmark criterion through which the expected and actual attainment results would be evaluated. As such, the venture should only retain a distribution partner if a cost analysis of such a partnership establishes an excess of benefits against market costs. 3.0 Target the Low End Consumers In the SWOT analysis, the review establishes that one of the organizational challenges is its lack of diversification. In this case, the diversification is not in terms of product varieties, but on targeted consumer base. Evidently, the organization stocks high end products and thus targets the Middle class and the high middle class consumers in the market. In this respect, the organization leaves out a large consumer base of the low middle class and the low class consumer base in the Australian market. 3.1 Strategic Goal The goal in this strategic approach will be to increase the organizational consumer base. In this regard, Moyer, McGuigan and Kretlow (2006, p.731) developed a review on the role and merits of diversifying a consumer base. In this regard, the evaluation stated that through increased market diversification, organizations increased not only their revenue basis but also ensured educed seasonal revenues variations. Therefore, the strategic goal for the execution of the market diversification strategy is the consequential future establishment of an organizational revenue base stability. In turn, the goal achievement would guarantee an increasing bargaining power and thus overcome the identified declining suppliers bargaining power in the Australian retail industry (Appendix 2). 3.2 Strategic Plan The organizational strategic plan to achieve this goal will be the identification of the untapped Australian retail industry market and consequently tap it. In this case, plan in the execution of the strategy would include the development of alternative marketing strategies as well as stocking of different products in the new markets. In this case, differentiation of stocked products in the new low end markets would enable the venture successfully tap into the wide consumer base (Jalan, 2005, p.43). Moreover, the strategy, involves the strategic plan of develop systems and practices for the eventual integration of the different identified organizational industry markets. 3.3 Tactical Actions In the achievement of the discussed market diversification goals and the subsequently discussed strategic plans, the venture should execute the following tactical activities among others: Conduct a market survey to evaluate the percentage and possible profitability margins upon investment I each of the diversified markets. An additional tactical approach would be the evaluation of the respective costs benefit analysis for each established new market segment in order to profile them based on their costs and short and long term gains. Finally, the strategy execution includes the actual development of infrastructure and allocating sufficient financial resources in the organizational budget for the eventual market roll out. 4.0 Develop a Strong Brand Image An evaluation of the organizational porters five forces model establishes that the organizational bargaining power is declining as a result of a decreasing brand image reputation in the market. As such, the analysis review establishes that through the development of an increased brand image and market reputation would increase the overall organizational market competitiveness. 4.1 Strategic Goal In this case, the strategic goal as developed by the organization is the developed and increment of an overall organizational brand image and reputation in the market. Pryor and Grossbart (2007, p.293) conducted a study on the role of an organizational brand image and reputation in enhancing organizational management success and increased performance. In this regard, the evaluation argued that through increased promotion of organisations brand image has a direct impact on the overall market success. As such, the strategic Myer organization goals in this case, will be to increase and boast the market brand reputation as an approach to counter the rising market competition from peers such as David Jones Company. 4.2 Strategic Plan The strategic plan for the achievement of this goal involves the evaluation of the current markets brand image reputation as well as the growing and developing trends. In this case, the plan involves the evaluation of the existing consumer needs and preferences. As such, the system allows for the distinction of the consumer perception of quality. In this regard, once such an evaluation is developed, the organization can effectively develop the ideal promotional marketing measures and approaches in which to increase and boast its brand image. Therefore, the strategic plan in this concept includes the determination of a relevant and appropriate promotional concept. 4.3 Tactical Actions The organizational management should develop a research and design function. In this case, the departmental function should be tasked with evaluating and conduct market image and brand image reviews in the market. The department should evaluate causes of the declining organizational brand image. Consequently, this should be accompanied by the development and establishment of alternative approaches recommendation. One alternative brand image development recommendations are offered, the management should ensure a costing and he eventual funds allocation for the strategic approach. Finally, the venture should on a regular basis evaluate the performance and success of the funded promotional approaches to ensure efficiency in resources utilization. 5.0 Conclusion In summary, this report develops a strategic evaluation on the market situation and strategic alternative approaches through which the venture can mitigate the current and forecasted retail industry market changes. As such, the analysis lists cases such as brand image and reputation development, target markets diversification to encompass the low society income earners and the development of strategic forward industry distribution alliances. In this regard, the report offers tactical approach on the step by step process through which each of the respective developed strategies and market goals under each of the strategies could be executed funded and evaluated to enhance efficiency. References Rangarai, N., Raghuram, G., & Srinivasan, M. M., 2009, Supply chain management for competitive advantage: Concepts & cases, Tata McGraw-Hill, New Delhi. Cant, M. C., 2006, marketing management. Juta, Cape Town, South Africa Moyer, R. C., McGuigan, J. R., & Kretlow, W. J., 2006, Contemporary financial management, Thomson/South-Western, Mason, Ohio Jalan, P. K., 2005, Encyclopaedia of economic development, Sarup & Sons, New Delhi. Pryor, S. & Grossbart, S. 2007, "Creating meaning on main street: Towards a model of place branding", Place Branding and Public Diplomacy, vol. 3, no. 4, pp. 291-304. Strength The organization has strong brand equity. Market share leadership over others such as David Jones in the Australian market. Assets leverage. Opportunities Use of the online platform to increase its market sales and coverage Products portfolio diversification to include low end products at minimal and reduced prices Acquisitions of other retail ventures in the market to increase market presence and distribution infrastructure Weakness Lack of diversification in venturing to the low end retail industry market. Low investments in Research and development. Diseconomies of scale. Threats Competition from emerging industry peers. Threat of substitutes. Economic slowdown in the Australian market. Appendices Appendix 1: Myer Company SWOT Analysis Appendix 2: Myer Company Porters Five Forces Model Porters Factor Discussion Buyers Bargaining Power A high buyers bargaining power. Competition for buyers attention in the retail industry with increased products variety increase their bargaining power Organization must tap into the consumer base to increase future market consumer base control over peers. Suppliers Bargaining power Low supplies bargaining power There are many industry suppliers This increases their market saturation and thus exposing them to a declining bargaining power Competitors The industry has key competitors such as David Jones Limited and Target Australia. Their established market base and influence pose a threat to Mayer Company Threat of substitutes There is a relatively high threat of substitutes The market switching cost is low allowing for ease of change among consumers. These eposes the organization to a long-term market success challenges. Threat of new entrants The Australian market opens under the free market basis. This opens up the industry to the risk of new entrants into the future The organization must develop a strong brand reputation to overcome such future market challenges. Read More