retail strategic planning w. frank dell ii, cmc september, 2004
TRANSCRIPT
RETAIL STRATEGIC RETAIL STRATEGIC PLANNINGPLANNING
W. Frank Dell II, CMC
September, 2004
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AGENDAAGENDA
INTRODUCTIONSTRATEGY
TACTICS
OPERATIONS
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ObjectivesObjectives Define Retail Strategic Document components and elements Describe the development process Identify common mistakes
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Strategy DefinitionStrategy Definition
A plan, method or series of maneuvers for obtaining a specific goal or result
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OverviewOverview
CorporateGoals
StrategicPlan
TacticalPlan
OperationsPlan
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Time HorizonTime Horizon
DESCRIPTION 1 2 3 4 5 6 7 8 9 10
Corporate Goals
Strategy
Tactics
Operations
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Maslow TheoryMaslow Theory
Self-Actualization
Esteem
Love, affection & belonging, safety
Physicological
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AGENDAAGENDA
INTRODUCTION
STRATEGYTACTICS
OPERATIONS
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What Business?What Business?
Business
Products Type
Industrial Consumer Service Wholesale Retail
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Business GoalsBusiness Goals Sales
– 1 million– 5 million– 100 million– 1 billion
Geographic– City/Region– Country– Continent– World
Business
Market
Competition
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Consumer is KingConsumer is King
The Golden RuleHe who has the Gold (consumer) rules
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Which Consumer?Which Consumer?
Buyer User/Customer
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Define the Target MarketDefine the Target Market Sex Age Education Income Life Style Ethnicity
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Target Market - SexTarget Market - Sex
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Target Market - AgeTarget Market - Age Infant – 1 to 3 Junior – 3 to 8 Youth – 8 to 12 Teen – 12 to 19 Young Adult – 19 to 30 Middle Age Adult – 31 to 55 Senior Adult – 55 to 100
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Target Market - EducationTarget Market - Education No education Elementary School High School College / University Advanced Degree
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Target Market - IncomeTarget Market - Income Person Vs Household Income
– 2,100 Rubles per month– 3,500 Rubles per month– 7,000 Rubles per month– 10,500 Rubles per month– 14,000 Rubles per month– 17,500 Rubles per month– 17,501 + Rubles per month
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Target Market – Life StyleTarget Market – Life Style Vegetarian Diabetic Over-weight Health nut Active
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Target Market - EthnicityTarget Market - Ethnicity Geographic region Race Religion
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Target MarketTarget Market
Sex M F H
Age I J Y T YA MAA SA
Education No ES HS C/U AD
Income 2.1 3.5 7 10.5 14 17.5 18+
Life Style V D OW H A
Ethnicity R R R
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Factor in TrendsFactor in Trends Aging population Growing Middle Class Changing Health & Life Style
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Elements – Format SizeElements – Format SizeHow many formats & what size?
Receiving & Backroom Processing
Merchandise Display
Office Customer Service & Checkout
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Elements - MerchandiseElements - Merchandise Reason for the store Department / Category / Sub-Category
– Match target customers needs & wants– Interest secondary consumers
Depth and Breath of presentations– Brands– Sizes– Flavors / Styles
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Elements - MerchandisingElements - Merchandising
Role Destination Routine Occasional / Seasonal Convenience
Quality
Good
Better
Best
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Elements - DecorElements - Decor Fixtures Lighting Flooring Signage
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Elements - ServicesElements - Services Checkout
– Cash– Credit & Debit card
Sales assistance Returns Lay-A-Way Gift Registry
Demonstrations Sampling Delivery Installation Education
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Brick Vs ClickBrick Vs ClickPositives
Additional Sales Brand building Reach larger target
market Lower investment
Negatives Different business Delivery Divides resources
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Operating & Capital Operating & Capital ModelsModels Sales- Cost of Goods
= Gross Margin- Labor & Benefits- Utilities- Rent- Advertising
- Taxes
= Profit
Site
+ Store Construction
+ Fixtures
+ Merchandise
= Capital Cost
Payback
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ValidationValidation
TargetCustomer
Market
Strategy Competition
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AGENDAAGENDA
INTRODUCTION
STRATEGY
TACTICSOPERATIONS
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OverviewOverview
Advertising(ABC)
Advertising(ABC)
PricePrice DiscountDiscount
DisplayDisplay POPPOP SeasonSeason
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AdvertisingAdvertisingTelevision
MagazineRadio
NewspaperInternet
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PricingPricing
Hi Lo
Everyday Low Price
Seasonal
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CategoriesCategories Traffic Building - High share, frequent purchase Transaction Building - Higher price, impulse buy Profit Contribution - High gross margin, turns Cash Generation - High turn, frequent purchase Excitement Creating – Impulse, lifestyle Image Creating – Frequent purchase & promotion Turf Defending – Customer draw
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PromotionsPromotions Types – Unlimited
– Price off– Buy one get one– Continuity– Coupons– Joint SKU
Match target consumers desires Support strategic image Incorporate Frequent Shopper Program
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Location, Location, Location, Location, LocationLocation Where
– Work– Live– Play
Travel mode– Walk– Drive– Public transportation
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AGENDAAGENDA
INTRODUCTION
STRATEGY
TACTICS
OPERATIONS
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IntroductionIntroduction A Strategic Plan that is or can not be
executed is only a dream
Each Department must define an action plan to achieve the strategy
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Human ResourcesHuman Resources Attract Educate and Train Evaluate Retain
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LogisticsLogistics Inbound
– Store Vs Warehouse Delivery– Method (truck, rail, water)
Storage & Processing– Number warehouse by commodity– Location and size
Outbound– Frequency, distance, temperature
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Information TechnologyInformation Technology Hardware
– Processing power– Security & back up
Software– Transaction processing– Management control & reporting– Analysis and planning
Network– Volume– Distance
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Store OperationsStore Operations Consistently execute customer service Merchandise in-stock Train for expansion
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CommercialCommercial Selection
– Categories, Sub-Categories & Items– Pricing & Promotion
Inventory Turns Merchandise in-stock
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Finance & AccountingFinance & Accounting Manage cash Maintain budgets and controls Secure sufficient capital
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SummarySummary
CorporateGoals
StrategicPlan
TacticalPlan
OperationsPlan
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Fatal Sins of Strategic Fatal Sins of Strategic PlanningPlanning Have a weekend retreat once a year to
talk about strategy Viewing Strategy as a “diet” Develop vision, mission and/or value
statements as “fluff” Vision without action Failing to involve all in developing an
action plan Failing to integrate planning
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Fatal Sins of Strategic Fatal Sins of Strategic PlanningPlanning Conducting business as usual after
strategic planning Lacking a scorecard or measurement
– Doing what is easy rather than what is important
Neglecting to benchmark against competitors
Failing to make tough choices
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W. Frank Dell II, CMCPresident
DELLMART & Company125 Hardesty Road
Stamford, CT 06903 USA
Tel: 203-968-8609Fax: 203-968-8613
e-mail: [email protected] Site: www.Dellmart.com