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分析Laura Ashley控股公司的全球战略-finance作业代写

2017-01-12 | 来源:51due教员组 | 类别:Essay代写范文

英国finance作业代写精选范文:“分析Laura Ashley控股公司的全球战略”,这篇文章主要讲述了劳拉艾希礼控股有限公司是领先的服装,家居用品及相关产品集团,成立于1953。在Laura Ashley的早期阶段,它已成为全球著名的企业通过并购快速。然而,Laura Ashley的经营业绩一直在下降,从1990年初的一些问题。尽管CEO们的众多变化,劳拉艾希礼公司仍然远远落后于竞争对手,很难跟上现代社会经济的增长.。因此,本文将指出为什么劳拉艾希礼公司的战略能力和环境之间的不匹配。

1.0 Introduction

The Laura Ashley Holdings PLC is the leading clothing, home furnishings and related products group, which founded in 1953. In the early stage of Laura Ashley, it had become the famous global business by acquisitions fleetly. However, the business performance of Laura Ashley has been on the decline from early 1990’s by some issues. Although with numerous changes of CEOs, the Laura Ashley Company was still left far behind the competitors and was quite hard to keep up with the growth of economy in modern society. Therefore, this paper will point out why there were mismatches between the strategic capability and its environment for Laura Ashley Company.

2.0 Overview

The mission statement of Laura Ashley Company is to provide the elegant lifestyle with a unique taste for People. It will use SWOT analysis to indicate the threats, opportunities, strengths and weaknesses of the Laura Ashley Company. The Chart 1 has shown the SWOT Analysis

Chart 1: SWOT Analysis

The strengths and weaknesses can indicate that the internal factors of the company. The company has the special British traditional country style products, made the products have the unique taste that can absorb customers’ attentions. This will increase the competitive power for the company that other company in the same industry was hard to catch up. However, Treadgold (1991) mentioned that the high price of the products in Laura Ashley will made a few consumers can afford it, which is one of the weaknesses. In addition, the company was trying to capture the market of young people, so that it reduced the original customer loyalty.

On the other side, the external factors of Laura Ashley will be shown from the opportunities and threats aspects. On the one hand, the company is a famous global business with long history, so that the company’s brand is the huge intangible asset for business (Goold & Luchs, 1996). The brand can bring many regular customers who are supporting the company. More over, the original target customers are middle to aged women, which is a huge age group. Based on the current market trend, the products of supplement to aged group people are reducing, so that the company has the opportunities to develop. However, different demand in different country made the company easy to get the wrong positioning in the serious competition environment, which are the threats for the Laura Ashley.

3.0 The ‘Problems’ Diagnosis

3.1 Positioning

Positioning is to perceive a product or service aimed at the intending potential customers in a particular market (Hauser, 1988). The good positioning can make the products of the business different from others, which may come into being the core competitive power of the company. The consumers around the world have some commonalities, but the differences are more important for business expanding to worldwide marketing. In general, Droge & Darmon (1987) have pointed out there are three kinds of positioning modes, including the global consumer culture positioning (GCCP), the local consumer culture position (LCCP) and the foreign consumer culture positioning (FCCP).

The issue for Laura Ashley Holdings PLC was the wrong positioning strategy. At the beginning, the Laura Ashley focused on the middle to older aged women based on the traditional style on products. This strategy has been proven so successful that Laura Ashley’s brand built the concept which is high quality products with high prices. With the company’s international expansions, the company changed the positioning which was focus on the younger women by new design style. The changing on the positioning strategy must make the Laura Ashley lose the regular customers those older people, because of the main customer’s age group has changed. Moreover, the Laura Ashley expanded their market in American which focused on selling home furnishings, the wrong location made the company get poor trading because the American customers would like to prefer popular clothing lines instead of home furnishings for this brand. In the serious competition environment, the wrong positioning strategy will bring the negative effect on the whole business strategy.  

In addition, Laura Ashley thought one of the reasons for bad business performance was the product’s price is too high, that Ann Iverson which is the Chief Executive changed the original pricing strategy to be the value-based pricing strategy and decided to go with more markdowns at the end of the seasons. This point out positioning has destroyed the brand’s imagination, which was slap-up and fashion manufacturer in the world. Therefore, the changing on positioning strategy made the Laura Ashley fails on keeping the competitive advantages in the competitive environment.

3.2 Retrenchment

Robbins & Pearce (1992) has mentioned the retrenchment strategy is a business shrink strategy that a large deflection from the original strategy based on the current situations and performance. Generally, adopting the retrenchment strategy is the short-term strategy, which used for turning to other strategic options after crisis. Purvis (2005) pointed out there are some characteristics for those companies which adopts the retrenchment strategy. First of all, the business has some actions about shrinkage, adjustment or retreat on the current products or markets. Secondly, the company needs to reduce expenditures and minimize the utilization of resources, which represents on just put the minimal resources. Thirdly, this strategy has the obvious short-term’s character.

As a result of the serious competition, Iverson who is the CEO of the company adopted the retrenchment strategy in her turnaround strategies for Laura Ashley Company. For achieving the objective of cost saving and gaining more potential profits, the company closed smaller and unprofitable stores which replaced by the larger new outlets. Although the number of the stores had reduced, the company increased the floor space. According to the financial statements of Laura Ashley, the business has sold more than 60% of the total assets since 1989 (Warnaby, 1994). It shows the disintegrating of operations have also been sold with a continuing supply agreement as manufacturing operations.

Although one of the turnaround strategies for Laura Ashley is retrenchment strategy, the costs was rising which is against the retrenchment strategy. Due the operations of Laura Ashley is vertically integrated, the disintegrating of operations made the design, manufacturing, distribution and retailing into 13 countries. Therefore, the result is the overhead costs were extremely high. It has pointed out the inadequate supply chain is the basic reason for company which influence the costs and sales growth for Laura Ashley Company. So, the retrenchment actions which adopted by the Laura Ashley can’t solve the essential problems for business in the competitive environment.

3.3 Financing

One of the main financing problems for Laura Ashley Company was seriously shortage of investment in the period 1991 to 1995. Based on the financial reports of the company, it has shown that the retained profits/losses for the year were all around zero, which mean deficit was occurred nearly every year, even negative cash flow. On top of that, more capital of company has been raised by the issuance of stocks, partially to buy back debts to relief interest expenses and keep the relationships with financial institutions, but it seems not effective for financial problems of company.

In the competitive environment, the foreign direct investment is main form the modern capital internationalization, which can get the long-term profits by foreign investments (Rugman, 1980). For the company Laura Ashley, it demands more capital for reducing its debts which may from banks or investors. Due to the company had the continuing cash flows in the period 1991-1996, it was quite reluctant to lend more funds. The bad financial performance was conflict with the expansion strategy in Laura Ashley. Currently, the company only has the major source of funding from MUI, which owns about 40% of the total shares becoming the biggest shareholder in Laura Ashley. The shortage of financing is the main reason on finance why the company can’t exert their strategic capability in the competitive environment.

3.4 Organization

The organizational structure is the hierarchical framework that collaborates and contributes to serve one common aim (Pugh, et al, 1968). Ouchi (1977) indicated there are six key factors must be considered when managers design the organizational structure, which is the work specialization, departmentalization, chain of command, span of control, centralization and decentralization, and regularization. Therefore, it shows the over-decentralized or over-centralized organization is not good for the development and implement of business strategic capability.

For the Laura Ashley Company, it has already had three times reorganization from 1988 to 1995. In the early stage of 90’s, the company’s organizational structure seemed to be quite decentralized, as a result of the rapid expansion, even with the separate mail order catalogs for each sales region. This made the management team was not so effective for fulfilling the strategic capability and solving the problems.

Although there are some benefits on decentralized organization, it also has some disadvantages on it. The decentralized organization can accelerate innovation, because people with different skills or opinions can research more products for satisfying the demand. Compared with that, the difficulty is it’s hard to harmonize that will bring on inefficiency. In the competitive environment, the management team of Laura Ashley restructured the organization, but the over-decentralized organization still seems to be effective on strategic capability.

4.0 Recommendations

4.1 Reposition

Aimed at the problems of Laura Ashley Company, the first suggestion is to roll back the designing style of the products to be the traditional country style, as a result of this is the specialty of Laura Ashley. The function for that is to keep the customer’s original image on this brand, which is the differentiation for improving the competitive power in the competitive environment. In addition, the company needs to consolidate the past and existing customers those middle aged to older aged women, because of the trend of aging of population in the world.

In addition, the company should adjust the strategy on clothing part. Based on the American market, it has shown the American prefer clothing products to home furniture products. Thus, the supporting on clothing merchandise will increase the sales in American markets. Besides, the company has the strong customer loyalty so that the high-class and classy designs should be reposition in the UK market or imports to other countries in the future.

4.2 Retrenchment

Although the business adopted the retrenchment strategy, there was conflict between the retrenchment and expansion in the implementing process. As a result of the gigantic overhead costs caused by opening retail stores, the Laura Ashley should close down most of the small retail stores, which is just open a few high-end large showrooms in some key locations for promoting the brand around the world, such as, London, New York, and so forth. The reason is the company should find a good position where has a large enough audiences for their British country style products.

Based on the current situation of company, this retrenchment strategy is coincide with the recent sale of manufacturing operations, as a result of the sales and the operating costs are decreased. From above, the Laura Ashley can research and develop the new method about selling, that E-commerce and special booking from showrooms and affiliates may suitable for the international sales for Laura Ashley Company.

4.3 E-commerce

Nowadays, the e-commerce has already become the popular method all over the world, so that some businesses are so profitable and successful, like Amazon, Ebay, and so on.

Based on the current strategic problems and financial issues of Laura Ashley, the e-commerce method is a good choice, which can not only fulfill the retrenchment strategy, but also follow the development of society. The company just needs to show all the selections on the company’s website, and provide the good customer service and convenient transportations, so that the customers can get the same experiences as shopping in retail store. The e-commerce is cost-effective because of there is not too much overhead costs and easy to maintenance Gefen (2000). The most important is it will absorb unlimited target customers’ attentions from every corner of the world.

5.0 Conclusion

To sum up, the Laura Ashley Holding PLC has some problems on the business strategy, so that there were mismatches between the organization’s strategic capability and its competitive environment that difficult to correct. Firstly, the bad positioning made the gap between the company’s original objective and real market. Secondly, the retrenchment strategy didn’t play its role for reducing the costs and against the expansion strategy of the company. Thirdly, the limited investments brought the company was keeping the situation of deficit for a long time, so that the company was hard to solve the financial problem to compete with others in the competition. Lastly, the decentralized organization let the mismatches between the strategic capability and the working efficiency.

From above, there are some recommendations on the problems of Laura Ashley. The company should reposition the main products based in the good understanding about the competitive environment. And then, the retrenchment strategy is so necessary for solving current problems, that the company just open some key large showrooms in some key locations for promoting the brand. Otherwise, the business can try the new commence style, which is e-commerce. This is not only based on the retrenchment strategy, but also suit for the development of the modern society.

Reference:

Treadgold, A. 1991, Dixons and Laura Ashley: different routes to international growth, International Journal of Retail and Distribution Management, Vol. 19, Issue 4, ISSN: 0959-0552.

Goold, M. & Luchs, K.S., 1996, Managing the multibusiness company: strategic issues for diversified groups, Cengage Leaning EMEA, ISBN: 041513269.

Hauser, J.R., 1988, Competitive price and positioning strategies, Marketing Science, Vol. 7, No. 1, Winter 1988, pp. 76-91.

Droge, C. & Darmon, R.Y., 1987, Associative positioning strategies through comparative advertising: attribute versus overall similarity approaches, Journal of Marketing Research, Vol. 24, Issue 4, pp. 377-388.

Robbins, D.K. & Pearce, J.A., 1992, Turnaround: retrenchment and recovery, Strategic Management Journal, Vol. 13, Issue 4, pp. 287-309.

Purvis, G., 2005, Strategies for survival, III-Vs Review, Vol. 18, Issue 2, March 2005, pp. 39-43.

Warnaby, G., 1994, Laura Ashley – an international retail brand, Management Decision, Vol. 32, Issue 3, pp. 42-48.

Rugman, A,M., 1980, Internalization as a general theory of foreign direct investment: a re-appraisal of the literature, Review of World Economics, Vol. 116, No. 2, June 1980, pp. 365-379.

Pugh, D.S., Hickson, D.J., Hinings, C.R. & Turner, C., 1968, Dimensions of organization structure, Administrative Science Quarterly, Vol. 13, No. 1, June 1968, pp. 65-108.

Ouchi, W.G., 1977, The relationship between organizational structure and organizational control, Administrative Science Quarterly, Vol. 22, Issue 1, Mar 1977, pp. 95-113.

Gefen, D., 2000, E-commence: the role of familiarity and trust, Omega, Vol. 28, Issue 6, December 2000, pp. 725-737.

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