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Components of Strategic Planning Planning
Is the anticipation and organization of what needs to be done to reach on objective.
Components of Strategic Planning Strategic Planning
Involves adapting the resources of the firm to the opportunities and threats of an ever changing retail environment.
Components of Strategic Planning
•Mission Statement•Statement of Goals and Objectives•SWOT Analysis•Strategies
Components of Strategic Planning Mission Statement is a basic description of the
fundamental nature, rationale, and direction of the firm.
Shoppers stop - Mission
Commitment to delivering higher level of sensory experience and retaining most preferred brand status among consumers by offering contemporary and relevant merchandise, great store layout and ambience, educated staff, food and events for complete shopping experience.
Contemporizing the product basket to offer premium and luxury value.
Sustaining leadership in the departmental store category, while building dominance in other formats, through a pan India presence, efficient processes and incomparable service standards.
Continuing to be a learning and profitable organization
Case Study - Mission
Our core purpose is to create value for customers to earn their lifetime loyalty.
This is expressed as two key values:
No-one tries harder for customers
Treat people as we like to be treated
Elements of a Mission Statement• How the retailer uses or
intends to use its resources• How it expects to relate to the
ever-changing environment• The kinds of values it intends
to provide in order to serve the needs and wants of the consumer
Components of Strategic Planning Goals and Objectives Are the performance results
intended to be brought about through the execution of a strategy.
VISION – Shoppers stop
To be a global retailer in India and maintains its no.1 position in the Indian market in the department store category.
Values We shall not take what is not ours. The Obligation to dissent (against a viewpoint that is not
acceptable). We shall have an environment conducive to openness. We shall believe in innovation. We shall have an environment conducive to development. We shall have the willingness to apologise and/or forgive. We shall respect our customers' rights. The value of trust. We shall be fair.
Statement of Goals and Objectives• Market Performance Objective
• Financial Performance Objective
• Societal Objectives• Personal Objectives
Statement of Goals and Objectives Market Performance Objectives represents how a retailer
desires to be compared to its competitors.
For example shoppers stop wants to reach no.1 position in departmental store category.
Market Performance Objectives• Sales Volume• Market Share
Is the retailer’s total sales divided by total market sales.
Image building activity in luxury segment.
Statement of Goals and Objectives Financial Performance
Objectives Represent the profit and
economic performance a retailer desires.
Financial Performance Objectives: Profitability
• Net Profit Margin• Asset Turnover• Return on Assets• Financial Leverage• Return on Net Worth
Financial Performance Objectives: Profitability
• Net Profit MarginIs the ratio of net profit (after taxes) to total sales and shows how much profit a retailer makes on each Rupee of sales after all expenses and taxes have been met.
Financial Performance Objectives: Profitability
• Asset TurnoverIs the total assets and shows how many Rupees of sales a retailer can generate on an annual basis with each dollar invested in assests.
Financial Performance Objectives: Profitability
• Return on Assets (ROA)Is net profit (after taxes) divided by total assets.
Financial Performance Objectives: Profitability
• Financial LeverageIs total assets divided by net worth or owners’ equity and shows how aggressive the retailer is in its use of debt.
Financial Performance Objectives: Profitability
• Return on Net Worth (RONW)Is net profit (after taxes) divided by owners’ equity.
Strategic Profit Model
Net Profit Margin
Net Profit*
Total Sales
Asset Turnover
Total Sales
Total Assets
x
*Net profit after taxes
=
Return on Assets
Net Profit*
Total Assets
Financial Leverage
Total Assets
Net Worth
Return on Net Worth
Net Profit*
Net Worth
x =
Financial Performance Objectives: Productivity
• Productivity Objectives:State the sales objective that the retailer desires for each unit of resource input: floor space, labor, and inventory investment.
Financial Performance Objectives: Productivity
• Space ProductivityAnnual net sales divided by the total square feet of retail floor space.
Financial Performance Objectives: Productivity
• Labor ProductivityAnnual net sales divided by the number of full-time-equivalent employees.
Financial Performance Objectives: Productivity
• Merchandise ProductivityAnnual net sales divided by the average dollar investment in inventory.
Statement of Goals and Objectives Societal Objectives Reflects the retailer’s desire to
help society fulfill some of its needs.
• Employment objectives• Payment of taxes• Consumer choice• Equity• Benefactor
Statement of Goals and Objectives Personal Objectives Reflects the retailer’s desire to
help individuals employed in retails fulfill some of their needs.
• Self-gratification• Status and respect• Power and authority
Retail Objectives
Retail Mission
Market Performance Objectives
Financial Performance Objectives
Personal Objectives
Societal Objectives
Sales Volume
Market Share
Self-
Gratification
Power and Authority
Status and
Respect Benefactor
Equity
Consumer
Choice
Taxes
Employment
Productivity
Profitability
Minimal Retail Strategies Get shoppers into your store. Convert these consumers into
customers by having them purchase
merchandise. Do this at the lowest operating
cost possible that is consistent with the level of service that your
customers expect.
Strategies
SWOT Analysis Is the identification and analysis
of a retailer’s strengths, weaknesses, opportunities and threats a firm faces.
Strategies
Retail mixIs the combination of merchandise, assortment, price, promotion, customer service, and store layout that best serves the segments targeted by the retailer.
Retail Planning and Management
• Strategic Planning
• Operations Management
•Administration
• High-Profit Retailing
Retail Planning and Management Strategic Planning Is a plan of action detailing how
the retailer will respond to the environment in an effort to establish a long-term course of action to follow.
Retail Strategic Planning and Operations Management Model
MissionGoals and Objectives
SWOT
Strengths Weaknesses Opportunities
Threats
Strategic Planning
Social and Legal Environment:Socioeconomic Environment, State of Technology, Legal System, Ethical Behavior
Competitive Environment:Behavior of Consumers, Competition and Channel Members
Retail Strategic Planning and Operations Management Model
Competitive Environment:Behavior of Consumers, Competition and Channel Members
Social and Legal Environment:Socioeconomic Environment, State of Technology, Legal System, Ethical Behavior
Retail Marketing Strategy
Target Market(s) Location(s) Retail Mix Merchandise Pricing Advertising & Promotion Customer Service & Selling Store Layout & Design
Operations Management
Buying & Handling Merchandise
Pricing Advertising &
Promotion Customer Services
& Selling Facilities
High-Profit Performance
Retailing
Retail Planning and Management Operations Management Deals with activities directed at
maximizing the efficiency of the retailer’s use of resources. It is frequently referred to as day-to-day planning.
Retail Planning and Management Administration Involves the acquisition,
maintenance, and control of resources that are necessary to carry out the retailer’s strategy.
Retail Planning and Management High-Profit Retailing
To be a high profit retailer, the retailer needs good strategic planning coupled with strong operations management.