Describe the franchise retailer that you have selected. Describe the current climate and situation that your retailer finds itself in as it attempts to compete. Describe what is occurring in the industry. Provide a brief overview of the retail sector in which the retailer operates. What environmental and economic factors are affecting the retailer? Describe competitive pressures, changing demographics and buying preferences, consumer behavior issues, image issues, etc. that affects this retailer and how they conduct business. How has the industry changed as a result of e-commerce and technology?
2. How has your retailer changed and evolved over time? What is your retailer’s primary business? What is their business model (how do they choose to operate)? What is their corporate strategy? What are their goals? What parts of their business are growing and generate the most revenue? How is your retailer seeking to increase revenue in the future?
3. Corporate Analysis – Who is the parent company of your retailer? What other retailers are part of their portfolio? What is the parent company’s overall market strategy and how does this retailer fit into their overall strategy?
Who are the retailers’ competitors (both direct and indirect)? How does your retailer compare to these competitors in terms of its size, market dominance/share, sales, profitability, etc.?
What is your retailer’s competitive strength? How do they try to compete? Are there strategies that have not worked for them?
What retailers have they identified as competitive threats? Why?
5. Retail Market Strategy
a. Target Audience – Who is their target audience (Describe the target market in terms of demographic, psychographic and behavioral characteristics, if possible) How does this compare to the competition?
b. What image do they want to convey? How do they attempt to position themselves in the minds of consumers in the market? What is their current image in the industry and in the minds of consumers? Is this image working for them? How does this compare with the image of competitors?
c. How do they make use of technology (web and ecommerce, supply chain management, information systems, etc.)? How has technology affected the way they conduct business?
5 d. What is their global presence and strategy? What countries have they entered? How successful have they
been expanding into these countries? What obstacles have they faced?
e. What is their location strategy? Why have they chosen this strategy?
f. What is their approach to managing human resources? (if this info is available)
g. Describe their merchandising strategy – how they buy, what they buy, breadth vs. depth of merchandise, etc.
h. What is their pricing strategy and how does this affect their profitability?
i. Describe their approach to advertising and sales promotions. Has it been effective for them?
j. What challenges does your retailer face in terms of the retail strategy variables just described? Do some appear to be working better than others?
6. Conduct a financial analysis of your retailer and two to three of its top competitors. Include revenue growth, Gross Margin, Net Margin, Inventory Turnover, projected sales, etc. What does this analysis say about how your retailer operates and its profitability? What can your retailer do to improve its profitability?