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Magazine Luiza: Building a Retail Model of Courting the Poor Case - Admission/Application Essay Example

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This paper delves into the case of Magazine Luiza, a major retail chain in Brazil. As the company grows, challenges are identified as well as future implications on the company's operations. Also, recommendations are presented with regard to the long-term strategic considerations of the company…
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Magazine Luiza: Building a Retail Model of Courting the Poor Case
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Download file to see previous pages The company has revolutionized the store formats by pioneering the virtual showrooms style of retail, with a specific focus on consumer satisfaction with the help of its strategic human resource function.The company has revolutionized the store formats by pioneering the virtual showrooms style of retail, with a specific focus on consumer satisfaction with the help of its strategic human resource function.
The company has grown from being a traditional mom-and-pop store into a major retail chain in Brazil by means of acquisition. With the increasing competition in the retail sector of the country, the company aims to grow by another acquisition when it purchased Lojas Arno. This acquisition will add 52 new stores to the company's operations and 800 more employees. This will enable the company to operate in geographically more distant regions such as the Rio Grande do Sul and Santa Catarina.
 B. Complication
Over the years, the Magazine Luiza has grown mainly by acquisition. With its sixth acquisition within the period of eight years, the company's decision to purchase Lojas Arno, a traditional retail chain in southern Brazil has been contemplated by the company's top management as regards the future of Magazine Luiza as a whole. The major complication in the company's decision is the integration of the newly acquired Lojas Arno into the company's operations, especially the company's organizational culture.
According to Luiza Helena Trajano, the CEO of Magazine Luiza, the company's major competitive advantage is its customer-centric culture, with the training of its people. In the words of Frederic Trajano, the sales and marketing director of Magazine Luiza, “our challenge is therefore to keep our culture and business model going at the same time that the company is operating approximately 250 stores in 199 different and distant towns (11). Aside from the effect of this acquisition to the company's corporate identity, the company is also facing certain challenges in order to support its high-level of growth. For one, the company's choices of financing for growth is also an issue. Aside from it, the choice of where to expand is also an important consideration.  ...Download file to see next pagesRead More
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