Key Issues

1. Key Issues • What is retail strategy statement • How does it differ from “mission” and “tactics” • Career-search “strategy” • The building blocks of retail strategy • Process of developing retail strategy • The characteristics of a “window of opportunity” • SWOT analysis

2. Strategy vs Tactics StrategyTactics Planning, Direction Broad Unstructured Problem solving Creative External focus Irregular Long-term Difficult to evaluate Success comes from having a good strategy& executing it well Implementation Specific, detailed Structured Problem solving Analytical Internal focus Regular Short-term Easy to evaluate

3. The Building Blocks of Retail Strategy • ControllableVariables • Store Location • Store Format & Layout • Merchandise Management • Pricing • Communications • UncontrollableVariables • Consumers • Competition • Technology • Economic Conditions • Seasonality • Legal Restrictions What are theenvironmentalvariables? What are the elementsof the retail mix?

4. E.g., McDonald’s Retail Strategy What is McDonald’s … • Target market • Retail format • Bases for competitive advantage • What threats might it face in the future?

5. Developing an Overall Retail Strategy Target Market What’s the 3rd element of retail Strategy? Retail Marketing Mix: Controllable Factors Competition & Environment: Uncontrollable Factors • ControllableVariables • Store Location • Store Format & Layout • Merchandise Management • Pricing • Communications • UncontrollableVariables • Consumers • Competition • Technology • Economic Conditions • Seasonality • Legal Restrictions Retail Strategy The main focus: Bringing harmony between the controllable variables and the uncontrollable ones. Uncontrollable variables drive the controllable ones!

6. Which are SustainableCompetitive Advantages? • Dropping prices • Building a store at the best location • Selling hot merchandise • Increasing advertising • Attracting better sales associates by paying higher wages • Providing better customer service

7. More Sustainable Less Sustainable Sources of Sustainable Competitive Advantages

8. SituationAudit Identify Strategic Opportunities Evaluate StrategicAlternatives Establish Objectives, Allocate Resources Develop aRetail Mix Evaluate Performance,Make Adjustments Process of Retail Strategy Define theMission

9. Situation Analysis Organizational Mission Statement Define theMission Ownership & Management Product Category SWOT Analysis

10. Form for Mission Statement A mission statement should include: • The product/service to be delivered • The store’s claim (USP) • Other important claims • Identification of the target segment • What the segment will get • What the segment must give up

11. Situation Analysis Organizational Mission Statement Define theMission Ownership & Management Product Category SWOT Analysis

12. Window of Opportunity Strong Weak High Windowof Opportunity Low High Low

13. SWOT Analysis Strengths Weaknesses SWOT Analysis is a systematic approach to optimizing the fit between external & internal var’s Retail Mix … plus Management capabilities Financial Resources Overhead Cost Structure Merchandising Capabilities Store Management Capabilities Store Locations Loyalty of Customers Retail Mix … plus Management capabilities Financial Resources Overhead Cost Structure Merchandising Capabilities Store Management Capabilities Store Locations Loyalty of Customers Identify the Strategies here Opportunities Consumer Trends Competitiion Economic Conditions Seasonality Legal Restrictions Threats Consumer Trends Competition Economic Conditions Seasonality Legal Restrictions

14. Process of Retail Strategy Situation Analysis Sales & Profit Satisfaction of Publics Corporate Objectives Image & Positioning Identify Consumers As a result of theSituation Analysis

15. Objectives Statement Any objective must be clear, concise, and realistic. Objectives are often based on profit, market share, growth, etc. E.g., “…to get a 15% market share and maintain a profit margin of 25% by the end of the fiscal year” for a particular store. Or, “to increase comp store sales by 15% by end of the year.” Note that each objective must have a time frame. 15%

16. Suggest Objectives for: • Krispy Kreem • Wal-Mart • Burger King

17. Finalizing Retail Strategy Situation Analysis Sales & Profit Satisfaction of Publics Corporate Objectives Image & Positioning Image = how a retailer wants to be perceived by consumersPositioning = the strategy to project this image Identify Consumers Overall Strategy

18. Finalizing Retail Strategy Situation Analysis Corporate Objectives Identify Consumers Retail Mix Variables Overall Strategy Uncontrollable Variables Short-term operations Specific Activities (Tactics) Response to the environment

19. Monitoring Retail Strategy Situation Analysis Corporate Objectives Identify Consumers Retail Mix Var’s Overall Strategy Uncontrollable Var’s Short-term operations Specific Activities (Tactics) Response to environ. Evaluation Control (Monitoring) Adjustment

20. E.g., Chevron’s Control Mechanisms

21. Developing an Overall Job Strategy YourTarget Jobs What’s the 3rd element of retail Strategy? Your “Marketing Mix”: Controllable Factors Competition & Environment: Uncontrollable Factors • ControllableVariables • Your education • Job history • Skills • Interests • Commitment • Ability to distinguishyourself • UncontrollableVariables • The economy • Job availability • The “competition” • Etc. Job Strategy The main focus: Bringing harmony between the controllable variables and the uncontrollable ones. Uncontrollable variables drive the controllable ones!

22. Your Own “Product” Strategy • Determine your target market • Area of country • Type of company • Type of position • Assess & exploit your competitive advantage • Unique skills • Experience • Knowledge • Develop then present yourself as a desirable “product”

23. 54 49 Specific BusinessConcentration 33 31 Relevant WorkExperience Being aBus. Major 24 22 21 21 17 21 16 16 16 12 14 GPA 10 10 9 8 1 What Firms Want % 50 40 30 20 10 How Important is this Characteristic? 0 Critically Extremely Very Somewhat Not

24. What Firms Want % CriticallyImportant Attribute Integrity 96.7 Strong work ethic 86.9 Professional demeanor 85.2 Initiative 83.6 Emotional maturity 80.3 Self confidence 79.0 Leadership ability 78.7 Personable 62.9 Creativity 55.0

25. Knocking on doorsTeaching Contacts Missionary Training Learning a 2nd Language Living in a Foreign Culture Working Long Hours Self-motivation, self-discipline, handling rejection, creativity Training, interpersonal skills, self-confidence, goal setting Leadership, time management, planning, communications Learning skills, adaptability to new concepts, perseverance Ability to work with a new culture, tolerance Dedication & hard work E.g., Interpreting a Mission Action Skill Derived

26. What Is the Interviewer Really Asking? • Tell me about yourself • Why are you interested in this position? • What are your geographical requirements? • What are your salary requirements? • Tell me a story! • Do you have any questions?

27. Testing Resume Self- Evaluation Placement Center Library Alumni Database InfoTrac, Lexis/Nexis, Internet Self-Knowledge EmployerKnowledge Selling YourselfPreparation & Interview Network Practice Interviews Cover letter/ Resume Information Interviews A Career Position

28. Telling the Same Thing … • Should we tell the same story to every interviewer? • Should we customize our presentation? • … our resume? • … our cover letter? • Why? (Or why not?) • For the same reasons, retailers must focus their strategy on their target market