White paper on retail strategy
In the retail store industry, retailers are under constant pressure to increase sales, reduce operational costs, give customers value for their money, and be able to have consistent revenues and growth year after year. Retail store companies are expected to deal with the economic, political, and competitive pressures that affect differentiation and costs while at the same time create and maintain an excellent customer experience (Aaker, 2007). The only way that a retail company can succeed in such a situation is to controls aspects that are controllable. This white paper provides an understanding of the concepts and principles of a well-designed strategy process that should be implemented by the company. In addition, this white paper will include a set of examples of strategy planning activities that the company will implement.
Veemart is a retail company with six stores spread out across Montana and Missouri. Veemart is a small company closely held for-profit and runs retail stores in the two states. The company deals in consumer products that are sold in retail and makes up to 1 million in sales annually. The company has 400 permanent employees and 100 others who are employed on a temporary basis. The company’s mission is to become a quality leader in retail business by giving customers value for their money. The goal of this white paper is to come up with a well-designed strategy process that the company will implement in the next few years.
Retail market strategy
In strategic planning, strategy involves a series of activities or maneuvers that are meant to achieve specific goals and results (Mills, 2002). The strategic plan for the company will be made up of three main items which are the target market, a retail format, and a sustainable competitive advantage. These items will involve:
- The target market involves the market segment in which the company will be directing its resources,
- The retail format is the retail mix to be applied in order to meet the needs of the target market, and
- The sustainable competitive advantage is an advantage that the company will apply for a long time to ensure that it remains competitive.
The target market of the company is mostly middle aged adults who have stable jobs and families. The needs of this target market are consumer goods, including food, household goods, and apparel. The company will also be targeting young adults and senior adults. The company will basically provide personal and household items for its target market. The retail mix of the company will involve pricing policies, advertising and promotions, and membership vouchers. A sustainable competitive advantage refers to a business activity that would be a basis for competitive advantage. Since the stores operate in markets that value fresh and healthy products, the company will be offering straight from the farm-fresh vegetable and fruits at affordable prices as a sustainable competitive advantage. The company will also focus on providing excellent customer service through its employees (Ander, & Neil, 2004).
Benefits of the strategy
The strategy will yield various benefits and limitations, as summarized in table 1.
Strategic planning activities
The company will also engage in various strategy planning activities to ensure that the mission of the company, which is to become a quality leader in retail business by giving customers the value for their money, is achieved. These activities will include:
- Identifying the strategy: The main concept of strategy which is to provide customers with value for their money. The company will focus on providing items that customers need by stocking stores with these items at current market prices.
- Industry Analysis and Strategy: the company will conduct demand and market analysis to identify what the target market wants and what the industry offers.
- Resources and Capabilities analysis: the company will identify the resources to be used to provide consumers with their needs and offer fresh produce at affordable market prices.
- Analysis of the nature of the Competitive Advantage: the company will engage in an activity that will place it at a competitive advantage in the industry (Dawson, & Jung-Hee, 2005.. The company will be offering fresh produce at affordable market prices accompanied by excellent customer service.
- Human resource management: the retail industry is a labor intensive industry, and in order to implement the company mission, the company will not compromise on the number of employee in the stores (Megicks, 2007). Each store will have enough employees to provide customer service and build customer loyalty.
- Customer services and selling: the company will stock its stores with personal and household items that have high and low demand. The company will also source local fresh produce to implement its competitive strategy.
- Assessing progress: the company will assess how the strategies are implemented by periodically checking the number of customers flocking the stores, sales made, and assessing customer satisfaction (Souitaris, & George, 2007).