Group Four MGT 481 Class Presentation

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Group FourMGT 481 Class Presentation

• A Discussion of Retail Management Strategies
• Samantha Skiff
• Anthony Quinn
• Alfred Boudreau
• Robert Boudreau
• The Four Stooges

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Strategic Management in the Retail Industry

• Overview
• Types of Companies
• Product Diversity
• Strategic Specialization
• Focus Areas
• Key Strengths
• Niche Markets

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Types of Companies

• Supermarkets
• Department Stores
• Home Improvement
• Bulk-Sales Warehouses
• Hybrid Forms

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Product Diversity

• Up-scale Merchandising
• Food
• Domestics
• Home-Improvement Products
• Everything you can imagine!

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Strategic Specializations

• Focus Areas
• Unique Sales Strategies
• Specific Goals
• Key Strengths
• Top Management Teams
• Unequalled Buying Power
• Diversity

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Strategic Specializations Contd

• Niche Markets
• Higher Class Clientele e.g. Target
• Luxury Items e.g. Costco

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The Leader

• Wal-Mart Stores
• Ranked as Fortune Magazines Number One Company
  for the Past 2 Years
• - Very Strong Culture - First-Rate Work
  Ethic - A Business-Like Way of Doing Business

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Wal-Marts Strategies

• Growth
• Currently Over 1 Million Employees Worldwide
• Acquisitions
• Diverse Sales Mediums
• Target Market The Globe!
• Redefine the Customer Shopping
  Experience

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Wal-Marts Developing Strategies

• Emotions
• Charities
• In-Store Community Support
• Wal-Mart TV
• Find The Missing

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The Home Depot, Inc.

• Founded in 1978
• Worlds largest home improvement retailer
• Second largest retailer in the US
• Sixth largest retailer on a global basis
• 2002 sales of 58.2 billion

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The Home Depot Theme

• More than a store. You can do it. We can help.

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Growth Despite the External Environment

• In 2002
• Turbulent economy
• Conflicting indicators
• Despite the environment, Home Depot
• Opened 203 new stores
• Added about 40,000 new jobs
• Had EPS growth of 21
• Had revenue growth of 9

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Expanding New Markets

• Home Depot successfully entered the market in
  Mexico
• Continued success and profit growth in Canada

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Implementing Strategy to Support Future Growth

• Merchandising resets
• Information technology building
• Service Performance Improvement

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Community Focus

• Home Depot believes in giving back through
• Team Depot
• Building playgrounds
• Homes for Habitat for Humanity
• Olympic Job Opportunity Program

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Motivating Associates

• Enhanced pay and benefits
• Tuition reimbursement
• Success Sharing program
• Employee Stock Purchase Plan
• Employer of Choice survey

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TARGET

• Expect More Pay Less

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How big is Target?
Note Targets data is from 2002 and Walmarts
data is from 2003
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Mission Statement

• Creating value elicits excitement. Loyalty.
  Devotion. Passion. Fun. It means delighting our
  guests, respecting our team members, supporting
  our communities and delivering superior
  shareholder returns. So how is value created? Is
  value created by product design or price? Is it
  about a convenient store location or a convenient
  store layout? Is value about the payment options
  offered or the smile of the cashier who rings you
  up? Is it about a companys brand or its
  commitment to communities?

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Target Says.

• YES!!!

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Targets Business strategy

• Differentiation strategy Our commitment to
  please our guests is at the heart of our
  strategy.
• Technology We believe that Targets dedication
  to driving change through technology positions us
  as a leader in the industry and we are firmly
  committed to sustaining this advantage.
• Positive image in the public eye

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Differentiation

• Differentiation requires a firm to create
  products/services that have a unique value that
  customers are willing to pay for. Price is not
  the primary focus.
• Target Invests millions of dollars in systems and
  training to speed up the checkout process in our
  stores.
• Expansion program to penetrate new markets and
  attract new customers. In 2002 Target opened 82
  Target discount stores and 32 SuperTarget stores.
  

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Technology

• Smart Chips in the Target Visa Card.
• Useful marketing tool. As the smart chip
  technology advances knowledge of shopping
  preferences and vendor partnerships will allow
  Target to deliver greater value to customers
  through the use of customized promotional offers.
• Electronic coupons.
• Receipt-less returns

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Positive Public Image

• For 60 years, Target has contributed 5 of its
  federally taxable income to national and local
  non-profit organizations.
• Donates 2 million dollars a week
• In 2002, Forbes recognized Target Corporation as
  Americas most philanthropic company.
• Take Charge of Education program donates to
  schools and children across the country.
• Reading initiatives at Target, Marshall Fields,
  and Mervyns.
• Target House, a home away from home for the
  patients and families of St. Jude Childrens
  Research Hospital

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Recent Developments

• Federated Interested in Acquiring Marshall
  Field's from Target Corp.2004 Apr 14 449 PM
• Target Corp. to Open Twenty-Five New Stores2004
  Mar 3 801 AMTarget Stores, a unit of Target
  Corp., announced the opening of 25 new Target
  stores

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Costco Wholesale
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Costco Wholesale

• Started with a Niche Focus
• High-End Merchandise
• Founded before Wal-Marts Sams Club
• Growth into Major Retail Competitor

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Costco Wholesale

• Vertical Integration
• Production Facilities
• Meat Processing Plant
• Expansion into New Markets
• Pharmaceuticals
• PharmacyChecker.com Seal of Approval

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Costco Wholesale

• Political Lobbying
• Labor Lobbying in California
• Governor
• Schwarzenegger
• Major Cost-Cutting
• CEO Jim Sinegal Says all frills and costs
  historically associated with wholesalers like
  fancy buildings have been virtually eliminated

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Questions, Comments, Concerns

• ?

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We Thank You!