Burberry Strategic Analysis
Table of Contents
Executive Summary1
Strategic Review
A)Strategic analysis of Burberry
i. Environmental Analysis………………………………………………………………………………………1-3 ii. Resources and competence analysis………………………………………………………………….3-4 iii. Purpose/culture/stakeholder analysis4 B) Recommendation for future development
i. Three options suggested using TOWS Matrix5-6 ii. Chosen strategic option6
Appendices and Bibliography7-13
Executive Summary
This report is a strategic review of Burberry PLC and analyses the Environmental factors that surround the business. It looks into Resource, competence and culture analysis. Each section analyses Burberry and critiques the models. A SWOT analysis and TOWS matrix are then formed to outline three options of which one has been recommended.
Environmental analysis
PESTLE
With reference to Appendix 1
This PESTLE analysis was carried out for Burberry PLC as an aid to decision making. By looking at the external macro environment Burberry can plan for the future and analyse the risks that occur within that market.
In the current countries and the emerging markets they operate, they must be wary of political stability as this could have an adverse impact on their operations or revenues. E.G a change of government in the UK has seen VAT due to increase to 20% in January 2011. Furthermore in emerging markets several countries have a variety of legal systems which can be changed retrospectively. This may not be enforced consistently especially in times when public debt is high and tax revenues are declining. Currently Burberry uses a risk assurance department to monitor markets and ongoing developments. If the option of expanding for future development is considered then this department would research whether it is feasible. Economic factors that should be considered when planning future development include interest rates, taxation changes and exchange rates. Prior to the economic downturn late 2008 the luxury goods market
Executive Summary1
Strategic Review
A)Strategic analysis of Burberry
i. Environmental Analysis………………………………………………………………………………………1-3 ii. Resources and competence analysis………………………………………………………………….3-4 iii. Purpose/culture/stakeholder analysis4 B) Recommendation for future development
i. Three options suggested using TOWS Matrix5-6 ii. Chosen strategic option6
Appendices and Bibliography7-13
Executive Summary
This report is a strategic review of Burberry PLC and analyses the Environmental factors that surround the business. It looks into Resource, competence and culture analysis. Each section analyses Burberry and critiques the models. A SWOT analysis and TOWS matrix are then formed to outline three options of which one has been recommended.
Environmental analysis
PESTLE
With reference to Appendix 1
This PESTLE analysis was carried out for Burberry PLC as an aid to decision making. By looking at the external macro environment Burberry can plan for the future and analyse the risks that occur within that market.
In the current countries and the emerging markets they operate, they must be wary of political stability as this could have an adverse impact on their operations or revenues. E.G a change of government in the UK has seen VAT due to increase to 20% in January 2011. Furthermore in emerging markets several countries have a variety of legal systems which can be changed retrospectively. This may not be enforced consistently especially in times when public debt is high and tax revenues are declining. Currently Burberry uses a risk assurance department to monitor markets and ongoing developments. If the option of expanding for future development is considered then this department would research whether it is feasible. Economic factors that should be considered when planning future development include interest rates, taxation changes and exchange rates. Prior to the economic downturn late 2008 the luxury goods market
Bibliography: Burberry Ltd. (2010). Burberry Ethical Trading Policy. Retrieved November 25, 2010, from http://www.burberry.com/downloads/pdfs/EthicalTradingPolicy.pdf Burberry Ltd. (2010). Corporate Profile. Retrieved December 5, 2010, from http://www.burberryplc.com/bbry/corporateprofile/ Dagmar Recklies. (2001). Beyond Porter – A Critique of the Critique of Porter. Retrieved December 10, 2010, from http://www.themanager.org/pdf/p5f.pdf Helm, C., & Jones, R. (2010). Extending the value chain. Journal of Brand Management , 579-589. Markets and Risks. (2010). Retrieved December 5, 2010, from Burberry: http://uk.burberry.com/ McDonough, M. (2009, October 6). Components of a PESTLE Analysis. Retrieved December 10, 2010, from http://www.brighthub.com/office/project-management/articles/51754.aspx Moore, C., & Birtwistle, G. (2004). International Journal of Retail & Distribution Management. The Burberry business model: creating an international luxury fashion brand , 412-422. Porter, M. (1980). Generic Strategies. Retrieved December 1, 2010, from: http://www.marketingteacher.com/lesson-store/lesson-generic-strategies.html 12 Manage Fast Track: (1986). Stakeholder Mapping. Retrieved December 1, 2010, from: www.google.co.uk/images