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Sears: Vision of Grandeur – Case Study Essay

Q1.List sears strengths and weaknesses. Then asses how well each of the proposed changes in Sears strategy will build on the strengths and work to eliminate the weaknesses?

Strengths of Sears
-Broad category of product offerings, i.e: hard side(hardware) and soft side (women apparel, children toys etc) of Sears -Strong retail network system
-Colossal numbers of stores with huge capacities are present all over the country, both in and off malls. -Owner of mix of brands i.e. : strong brands of hardware, namely, Kenmore & Craftsmen or even ethnic based brands , such as Russell Kemp for African Americans -Merger of Sears with Land’s End, has given the company boost to address the shortcomings in their fashion image

Weaknesses of Sears

-Many layers of management, with hodgepodge bureaucracy
-Messy and uninviting interiors of the stores
-No proper display of products such as the women apparel
-Very less dressing/changing rooms and mirrors were present, which are a key factor in decision making of women to my clothes
-Decline in the market share of Sears to its competitors such as Wal-mart
-Sears is unaware of who its consumers really are?

-Sears is unaware where do they exactly stand in the market?
-Drop in the share price of Sears in 2004, after gaining an 83% decrease in net income
-S&P credit rating was dropped, so their credibility was also under question
-Inexperienced management

-Unrelated diversification – investment banking and financial advising -The persistent image of “Hardware stores”, has been unable to be changed Under the proposed changes, many of the strengths are being used to cater and eliminate the weakness of Sears. For being a flop in fashion department, they have merged with Land Ends. For having a consistent hardware store image, they have introduced the softer side, as in diversification in women’s apparel, although it was not a big success. To cater more ethnic customers, they are introducing their culture originated products, such as cookware especially for Mexicans and Caribbean.

To focus on its core business, retailing, Sears sold its credit card operations to Citi group for $32 billion, which will help them renovate their stores and increase sales from operations. For the major big change and in order to get back its shares from competitors, Sears management is launching The Sear Grand Stores. These line of stores will be huge in capacity, with related diversified retail products ( e.g: books, music, movies, toys, etc), away from typical malls and will offer every product in an intriguing & sophisticated appearance.

Q2. Develop a positioning statement for the new Sears that would be broad enough to cover all the types of Sears’s stores? In order for a company to be able to communicate its brand positioning or marketing plans, it forms a positioning statement. It includes the following main elements, namely, target group, the name of brand, their concept and what is does.

The positioning statement for Sears would be:

For our customers, Sears, is the best retailer, that delivers preeminent cost-quality combination and variety of products at your service, because only Sears knows what you want. Q3.In your opinion, is the claim “Sears is not a discounter” valid? Why or why not? The claim “Sears is not a discounter”, is indeed not valid. When sear had planned to open the five pilot stores under the line of The Sears Grand Stores, away from the retail market or malls, what it wanted to do was to monitor customer reactions by varying merchandise assortments. They were targeting the local market with introducing the new departments such as movies, music, toys, cleaning supplies, books & magazines, dry grocery, pet supplies, seasonal garden center, an automotive center and home maintenance tools. Since their location were free stands and away from usual malls, they needed to have promotional activities and offer discounts on their merchandise, in order to attract the local customer.

Q4. How successful do you think the Grand stores will be? Explain. Who is its competition? It was what the CEO of Sears said, that we need to find a way to get closer to customer, which inspired their management to launch The Sears Grand Stores. These stores were going to be five, initially in number, located in freestanding locations and away from usual retailing markets or malls of the country. They were targeting the local market with introducing the new departments such as movies, music, toys, cleaning supplies, books & magazines, dry grocery, pet supplies, seasonal garden center, an automotive center and home maintenance tools. So the main element of launching these five pilot stores was to closely monitor customer reactions to the produce collection and then develop a prototype store that best meets the customer demands.

The Sear Grand Stores idea itself is quite exciting concept, so as to facilitate the customers many benefits, but it might not be enough for Sears to get back its market share from its competitors. One analyst commented that “Sears has not fixed its core business. What they’ve done is play musical chairs with the management and worked on financial engineering – buying back shares, selling the credit portfolio, cutting costs like crazy – but not dealing with the core problem.” Defenders of the Grand stores said: We are trying to grow this company so that we can bring Sears to places we have not been before.” I agree to both the parts of the comments.

Sears has to work out its strategic thinking and lay out proper strategies in order to gain back its reputation it’s once had in 1970’s. Just by launching five pilot stores will not be enough to study the market. Proper market research has to be carried out and adoption of recent market trends has to be incorporated to put Sears back on the top. But no denying the fact either that the launch of the grand stores has given Sears a start to recovery. The competition faced by Sears will by the big retailers of the market, such as Wal-mart, Best Buy, Target etc and also the small departmental stores, which offer the same or similar product category, possibly at a lower price than Sears.


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