t eatons company IPO
Key Events:
The first Eaton store was founded in 1869. Eaton was the first retailer to sell merchandise for cash at fixed prices rather than by the credit and barter system. What once was an advantageous strategy to the brand, has slowly become the source of its progressive revenue losses. Now, due to specialized stores and increased competition, Eaton’s must restructure itself in order to continue being a major player in the retail industry.
Problem Statement:
Eaton’s must figure out its value as a business in order to determine an IPO price range. They must choose an appropriate valuation method in order to determine appropriate figures. If the IPO is priced too high or too low, it can result in further losses during the restructuring process.
Five Forces:
The retail sales industry is usually not one that is attractive to most people to enter into. When considering the high level of competition and constant threat of new entrants, it seems more suitable to those brands that have already established themselves and have a reputation behind them. Customers have the bargaining power since they have the option of spending their money elsewhere if prices or service don’t meet their standards, in which case they can always turn to competition and substitute the brand for another. The department store has the buying power from suppliers if it is large enough to dictate a large amount of volume from them. The larger the order size, the more power is within the department store.
S.W.O.T:
For the case of Eaton’s, their strengths do outweigh their weaknesses. Being an established name in the country of Canada and the history that precedes them, the department store has already built its brand and has prime commercial real estate unmatched by any competitor. Although it was a turnaround company, recently emerging from bankruptcy protection, Eaton’s had a lot of factors in its favour to re establish itself. Threatened by discount stores and “category killers”,
The first Eaton store was founded in 1869. Eaton was the first retailer to sell merchandise for cash at fixed prices rather than by the credit and barter system. What once was an advantageous strategy to the brand, has slowly become the source of its progressive revenue losses. Now, due to specialized stores and increased competition, Eaton’s must restructure itself in order to continue being a major player in the retail industry.
Problem Statement:
Eaton’s must figure out its value as a business in order to determine an IPO price range. They must choose an appropriate valuation method in order to determine appropriate figures. If the IPO is priced too high or too low, it can result in further losses during the restructuring process.
Five Forces:
The retail sales industry is usually not one that is attractive to most people to enter into. When considering the high level of competition and constant threat of new entrants, it seems more suitable to those brands that have already established themselves and have a reputation behind them. Customers have the bargaining power since they have the option of spending their money elsewhere if prices or service don’t meet their standards, in which case they can always turn to competition and substitute the brand for another. The department store has the buying power from suppliers if it is large enough to dictate a large amount of volume from them. The larger the order size, the more power is within the department store.
S.W.O.T:
For the case of Eaton’s, their strengths do outweigh their weaknesses. Being an established name in the country of Canada and the history that precedes them, the department store has already built its brand and has prime commercial real estate unmatched by any competitor. Although it was a turnaround company, recently emerging from bankruptcy protection, Eaton’s had a lot of factors in its favour to re establish itself. Threatened by discount stores and “category killers”,