Black Leisure Journey - Essay Example

and Section # of Black Leisure Journey Plc. Introduction The firm Black’s Leisure Group Plc remains powerful for its outdoor and board wear retailing with its tow main outlets as Outdoor and O’Neill. The Outdoor is the major retailing shop that sells board wear clothing, footwear and equipment whereas, O’Neill act as the main distributor and retailer of Black’s Leisure. Till 2007, the firm hold 100 Black’s High Street stores, 12 Out-of-Town stores, 274 Millets Stores, 47 Free Spirit stores and 15 O’Neill stores. The aim of this white paper is to analyze in-depth the position of the firm and where do we want to take this firm in next five years. A complete analysis is taken in account to know the real position of the firm in the market place, renewal of strategies that will help to achieve the next five years goal. Situation Analysis The firm is facing severe and serious challenges as it is internally weak and facing different external pressures. The firm has very weak supply chain management and facing losses due to its many stores which are poor in their yearly sales. The customer expectations and competitors are high and they are dealing with prices to capture maximum market share. The yearly profit is zero due to the formation of many unwanted goods. The firm is internally weak due to lack in leadership and is unable to gain talented employees. The firm is not including any system of grooming that will transfer a smooth power in the hierarchy. The firm lacks sustainability strategy which is another main weakness of the firm. Their marketing for their brand is very weak and this is the reason that their brand is not famous in the market. Moreover, the firm is holding their stores at location which does not cause convenience to the customers. The inventory control system of the firm is also very weak and requires many software upgrading. The firm is required to revamp its management and strategies. Moreover, the firm is required to tune up its supply chain management and should enhance its marketing to appeal the customers. Black Leisure Free spirit brand and women’s sport wears are the most attractive in the market and these brands are providing yearly revenue to the firm. They are operating a surf academy to attract new customers. Furthermore, it is a known name in the market due to its oldest working and that is the major advantage to the firm. Competitive Position in the Market The competitive position of the firm within the UK market is very weak and reason is their yearly loss and unable to attract the customer. As already mentioned, that the competitors are using the price technique to attract many consumers. Therefore, its competitive position within the market is low and in order to augment its market place, the firm is required to change its mission to objectives and to launch new strategies to gain the maximum revenue in the year. Asridge Model The aim to use the asridge model is to define the mission of the company that will lead towards the formation of objectives and goals that the firm will achieve in its next five years. The firm uses this model to evaluate their purpose, values, standards and strategies. These all together will help the firm to evaluate a better mission statement. Black Leisure’s Purpose The purpose of the firm is to “Guiding Light” on the horizon and to achieve the ultimate destination. Their purpose is to serve the market as much as they can1. The purpose of the firm is to provide a great value product to the customers which should inspire them, and let them enjoy the outdoors of Black Leisure. Achieving the customer loyalty is the firm purpose. Where as attracting the customers and creating sustainable return on the stake holder’s investment. Black Leisure’s Values Values of the firms are their beliefs that guide them to achieve their goals. We value our way of doing work that provide the ultimate product to the customer. The value of the firm is their customer2, treating them in best manner is their belief and value. They understand their customer, provide value and reach to them at first. The firm trusts on each other, on their customers, share knowledge, supports each other and celebrates the firm success, are the values of the firm. The firms strive to create value for their customers and to give their best. Firm’s standards The firm work on three main standards to produce best to the customer and these are 1. Better: the firm work on the standard of quality to produce a better product for their customers. 2. Simpler: the firm remain simpler as want to produce simple but unique things that the customers can handle easily. 3. Cheaper: the next standard of the firm is to produce a cheaper product that the customer can easily purchase from the market. The strategies of the Firm revolve around four main areas 1. Customer: giving what they want and satisfying their needs 2. People: making their employees world-class 3. Operations: effective and efficient operations to provide a quality service. 4. Finance: improving the shareholder’s return Moreover, their strategies can be define as their core skills and these are 1. Right things at right time: the firm want to introduce the right product at right time, right time means when the customer really need. In other words, fulfilling the customer needs at right time is their main strategy. 2. Efficient process3: the firm strategy to produce efficient process so that they can achieve quality is their strategy. 3. Improve relentlessly: the firms are adopting strategies to improve continuously in order to gain maximum quality product in the end. New Mission Statement The firm mission is to produce a “Differentiation” in their product with high standard quality by minimizing their internal cost. The firm will launch the new strategies to handle their operations and to gain maximum return by attracting maximum market. The firm mission is to see themselves as the top firm in outdoor wears in the European market in next five years. Porter’s three generic model Depending upon the market and product competencies, the firm usually adopt different strategies to compete according to the market type and its competencies. Porter’s divide his three strategies into two dimensions, strategic scope and strategic strength4. Black Leisure’s Plc strategies are taken in account with the help of this help to know that basically on which model they are working for and what new strategies they must adopt. Strategic scope defines the demand side of the market whereas; the strategic strength defines the supply side of the firm, that how much the firm is able to supply the products and to fulfil the needs of the consumers. Below the porter’s strategic model is define and with the help of this model we will see that which strategy the firm is adopting and what should it must adopt to achieve next five years objectives. 1. Segmentation strategies5: When the firm wants to attract the narrow market line, means to some specific group of the people and has unique competencies or using the low cost strategies, the firm is using the segmentation strategies. In this strategy the firm has segmented the market either on the basis of gender and age. The segmentation strategy focus on a special target market by producing the product that is like by them. 2. Differentiation strategy: the differentiation strategy is used when the firm want to attract a broad market and have unique competencies. The differentiation strategy involves innovation and uniqueness in the product and service so that it makes them different from their competitors. 3. Cost leadership strategy6: the firms uses cost leadership strategy to lower their firms overall cost so that they can lower the price of their product to attract the maximum market. Usually this strategy is used when the firm has high quality process engineering that can lower the over all cost of the firm. Black leisure is not using any of these strategies rather they are working on “Diversification” to attract the maximum market share. However, it is noticed that the firm is using Differentiation strategy as they have introduces many wears according to the demographic division of the market. They have introduces wears for women and free spirit wear that attracts a specific target market. Where I want to be them The firm still lacks enough and this can be seen from their yearly report, therefore, the firm must acquire other strategies to gain maximum. The firm internal cost is high and lacks leadership. Therefore, I will recommend the firm to use cost-effective strategy with differentiation in its product. The firm should approach a better operational structure that can lower its internal cost. Moreover, they lack supply chain management and this again causing a huge cost specially in distributing he products. To achieve the efficiency and effectiveness, the firm must need to provide a maximum quality product with uniqueness but must not forget to lower its cost at each step. Segmenting the firm into small groups will not be a better choice, while providing a different product while using minimum resources would be the best choice. Moreover, they should develop their better research and development department that can provide a better design and product in their future. Ansoff Matrix According to Ansoff matrix7, the firm diversifies when it provides new product and services in the existing and in new market. Below the graph shows that diversification of the firm is done when new product in new market is introduced. Already it is known that different shops of the firm are causing the cost to the firm and the reason is their bad location. Therefore, it is decided that the firm will diversify its product line and introducing them in existing and in new markets to attract maximum customers. The firm main mission is to diversify their product line. This mission is clearly mentioned on their websites that they want to increase their product line to capture maximum market chare. Keeping this thing in mind, SMART objectives are provided below that will help the firm to achieve Diversification. 1. Specific= the firm must uses its specific resources to develop their product line, moreover the objective of the firm will be to gain maximum productivity by using minimum resources. 2. Measurable = the firm will measure its output and productivity level at each step to know that where the firm is creating extra cost. The productivity and the operations of the firms will be measurable. 3. Achievement = the firm objectives is to achieve maximum customer’s loyalty and satisfaction to gain maximum market share. The next achievement will be the use of minimum resources to gain maximum output. 4. Realistic = it will show the availability of resources, their use and knowledge to the staff and the time taken to adopt these resources to achieve a better coaching 5. Timely =this objective is mainly concern with the supply chain management; a better timely supply chain would be adopted by the firm to provide the material at right time at right place. Objectives The objectives of the firm are 1. To produce differentiation while achieving the cost-effective strategy 2. To provide product at right time at right place 3. To enhance its supply chain management 4. To gain maximum customer satisfaction and loyalty 5. To produce a better brand awareness within the market 6. To increase the firm outlets. Risk Associated with these Objectives The risk is associated at each step and objectives when you are working in competitive market. The competitors are using the price techniques to produce a low price tag product. Therefore, when the firm wants to achieve the differentiation than the cost of the firm introduces. Therefore, there is great risk that might the firm internal cost increases and for this the firm should adopt cost-effective strategy to lower this risk. Increasing the outlets might attract the new customer but it is not sure that either the firm can gain customer at their new outlets or not? Either these outlets will work or not? These risks are associated with the new outlets and to decrease the risk the firm need to adopt a better research to know the market position of those new outlets. A complete survey is required to know the each factor in the new market that can effect the over all operations of the firm. The Strategic Hierarchy As the size of the organization increases the level of strategic hierarchy also increases. As the companies expands vertically the vertical hierarchy of the strategy increases. The choice paradox mainly depends on the strategies they choose. The choice of strategy mainly depends on the environment in which the company is dealing. Below we introduce marketing strategies that the firm must adopt to gain the maximum output. The marketing strategies hold different strategies in order to market and sale the product in better form. It include advertisement strategies, channel marketing, promotion, public relations and internet marketing. These all are the ways in order to promote the sales of the product. The marketing strategies are organized according to the market in which they are dealing and according to product that is produced by the company. The strategies are feasible and practically applicable. The firm has to use 7P’s of marketing strategy8 to enhance its market level. These 7 P’s are Product, Price, promotion, place, people, process and physical evidence. First of all, the firm is required a better positioning of the product and for this it should adopt Quality-price Promotional strategy. Quality-price positioning is the strategy in which you took two variables as quality and price to choose their market. They will position the product at a market in which they provide maximum quality with less price to get maximum market share. Similarly competitor positioning is that choosing the market in which your main competitor is serving. Actually the reason for choosing such market position is to compete with your competitor providing better product then your competitor. The other main category of marketing strategy is the innovation strategy holding three main variables as pioneers, close followers and late followers. Above all. The product strategy involves new product development, product line to be served to the market, brand to be served, packaging and labelling of the product and product life cycle decision. These all strategies will define that what product, its quality, its packaging and brand name should be introduced in the market. As. Already mentioned the firm should use the differentiation in the product strategy to provide a better product to the consumers. Though, promotional strategies are the marketing or advertising of the brand, but we are again using the Price as out main weapon to promote the product. The low price tag will automatically promote the product. Moreover, better advertisements and using the celebrity to promote the product will be used by the firm. The price strategy of the firm will be of two types, 1. Discriminatory pricing: the price strategies that discriminate the firm from its competitor. These strategies usually involve the pricing of product that differ a lot with the competitor pricing strategies. 2. Price-discount allowances: these are the pricing strategies that are usually adopted to promote products. Buy two get one free tag is the example of this price strategy. This strategy will be sued by the firm for their existing product line as to enhance it sales. People count a lot for the companies and their better strategies to deal with them will provide a better competitive edge in the market. Black Leisure will adopt a better strategy to serve their people in better way to increase their loyalty with brand. Their for, a better service before and after sale will be adopted and a better feedback system will be launched that can provide information about the learning of the customer experience. The people did not count customers only rather the employee’s of the firms are also included in it. Training and development of the expertise will be the firm first choice to increase their loyalty and retention rate The firm is required to enhance their process, especially supply chain process. For this, the firm will adopt supply chain management process to fastest their delivery process. The firm is required to decrease their time cost and to enhance their each process so that they can provide the right product at right time. The physical evidence includes the customer perception that directly affects the firm image. Therefore, the firm is required to enhance the physical evidence of the customer perception so that they can know what the perceptions of customers are and how to improve it. Conclusion The firm do hold expertise and better resources but lack in using these all together in a better way that can enhance the overall operations of the firm. Therefore, the above mentioned strategies must be used by the firm to gain the efficiency and effectiveness. The firm requires lowering their cost, enhancing their product to make it unique and to introduce a better supply chain strategy. Moreover, it must use its price as a main weapon to attract the customers. References Charles W.L. Hill, Gareth R, Jones (2003) “Strategic Management” 6th Edition Fred R, David (2005) “Strategic Management” Eleventh Edition Garth Saloner, Andrea Shepard (2001) “Strategic Management” Gregory G. Dess, G. T. Lumpkin (2003) “Strategic Management” Lee J. Krajewski and Larry P. Ritzman (2003) “Operations Management” Sixth Edition Philips Kotler (2003) “Marketing Management” Eleventh edition Philip R. Cateora and John graham (March 13, 2006) “International marketing”, Thirteen Edition. William O Bearden, Thomas N Ingram, Raymond W LaForge (January 13, 2003) “Marketing, Principles and Perspectives”, Third Edition. Read More