Strategic Management - Assignment

Strategic Management - Assignment

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About TopShop

Topshop is a multinational fashion retailer of accessories, make-up, shoes, and clothing, the company is British based retailer with 500 shops all over the world. The majority of the Topshop outlets are located in the UK. The company is also operating its online stores in a number of markets. Originally, the company was recognised by the name Top Shop and used to sell fashion by young British designers such as Stirling Cooper and Mary Quant. In the 1960s, initially, the company was a brand extension of department store Peter Robinson. The company struggled and expand rapidly in the 1970s and changed its name to Topshop and in 1990s, the company focused its struggle on presenting co-branded ranges with fashion designers and celebrities and conducted catwalk designs at budget prices. It is now part owned by private equity group of US (Gordon, 2014).

In 1964, Topshop was founded as Peter Robinson’s Top Shop within the Sheffield branch. The company was then a youth brand and had a department in the Oxford street store. In 1965, according to “The Times”, Top Shop was high fashion for “young and different” generation.  By that time, Gerald McCann and Mary Quant’s garment were stocked in the department (Hall, 2009).

Burton group, parent company launched a major extension of its women wear division in 1973. The Top Shop was split up by Peter Robinson into two chains. It was decided that the Peter Robinson would be focused to capture over 25 markets whereas Top Shop would be focusing on age range from 13 to 24. Ralph Halpern was made director of the new venture and the Top Shop developed independently and was highly profitable. Within two years of the split up Top Shop expanded and opened over 55 standalone branches. By 1978, it made profit of one million within a year and was declared as third Burton is operating profits. The brand is now key sponsor of London Fashion Week and operating in more than 37 countries (BBC, 2014.).   

Introduction to Strategic Management

Strategic management is continuous process that involves planning, analysis, assessment and monitoring of all the functions that is significant in meeting company’s objectives and goals. Prior to implementation of decisions, the process involves analysing those cross-functional business decisions. Strategic decision-making process is not static and involves analysing details of all the cross functions of an organisation including decisions taken by managers. In continuous changing business environment, experts have emphasized on continuous approach of decision-making (Gordon, 2014).

Strategic Management in Topshop

Like all organisations, strategic decision making in Topshop is non-routine decision making that involves science of management, art and leadership. In Topshop, the strategic decision making does not end on implementing new strategy but the managers of Topshop continuously review the new strategies outcome. The managers continuously assess the outcomes of new strategies to analyse and assess the company’s performance. Controlling measures are devised and implemented by the managers after assessing the outcomes.  Thus in Topshop, strategic planning, and decision-making is a continuous process of planning, organising and controlling the system (Haberberg & Rieple, 2008).

The strategic management of Topshop revolves around a number of targets, objectives, and goals. The strategic management of Topshop revolves around winning in fashion. The Topshop is focused on the aim of driving digital and expanding internationally. Topshop is product and brand-led business. Through strategic management, the company differentiates from its competitors and through its high fashion and value based product proposition, it engages with its customers.  It seems like the company has some catching up to do in its customer experience and digital agenda while the arcade of the company seems much comfortable in the place and product elements of the marketing mix (Witcher & Chau, 2010).

In order to be successful in the fashion world and in order to be at the top, the company, on and off introduce new designers lines to retain its position in the “high profile”. Company’s high fashion mission is the centre around which all strategies of the company revolve. The company also has the strategy of introducing new celebrities for promoting its brand. The combination of product and celebrity is the successful strategy of the company. The policy, combination of product and celebrities, helps the company in generating excess cash and extensive coverage of PR. Strategically, this celebrity fashion proposition is not only helpful in selling the company’s product but for Topshop, its benefits are beyond rather than simply providing the product (Hitt, et al., 2014).

Due to its strategic management policies, Topshop is sitting at the table of the fashion. The management strategy of the company also includes indulging in association contract with the famous brands, which help the company to run its operations in the crowded market. This has helped the brand to gain popularity among the customers and also creating its unique style in the market. The strategic management policies of Topshop have helped the company in taking its brand abroad in the strategic and pragmatic way. The strategic management strategies can also help the company in becoming number one brand of” America” all over the world (Jackson & Shaw, 2008).

Value Chain Analysis

Value chain analysis is one of the most important elements in order to formulate appropriate strategies that might help them to attain their set goals and objectives in a more appropriate manner. Moreover, the value chain analysis alludes to a sort of chain, which would centre upon the inbound and the outbound operations being rehearsed inside of the venture. It might be remembered that (TOPSHOP) should accentuation upon the conveyance of the merchandise in the best conceivable way. It has been alluded to as one of the noteworthy courses through which profitability will be expanded and in addition practice better competitive advantage between the market place. For this situation, the customers would be obliged to buy in fulfilling routes, for example, to welcome the clients with a cutting-edge accumulation of garments, unmentionables, other accessories at a reasonable cost. The costs appended along the items might give the customers with worth to cash. The visitors might not believe that the costs offered for the items are unnecessarily costly. This will give the clients to be pulled in towards its rivals (Rafiq, 2014).

At Topshop’s, there is a need to make important development inside of the format of the store, inbound logistics, planning of the store, operations, suppliers, and so forth. The distribution centres of Topshop`s should not store old supply of merchandise. This would give the new stocks to get their way inside the Topshop stores. However, the recent stock at the store will help to draw in more number of guests towards them. It is noted that more guests going to the TOPSHOP Store intends to elevated amounts of incomes would be produced by the same (Perrons, 2004). The packaging of the stocks at the store might likewise be given due thought. The bundling material utilised at TOPSHOP might be alluring which would help the customers to purchase the items structure TOPSHOP when contrasted with its rivals. It would be prescribed at TOPSHOP that, the items ought to be purchased from them the abroad market, which would prompt a lessening in the expense of creation of the material. The reduction in the cost of production will give the clients to purchase the items at less expensive rates when contrasted with the products offered by their competitors. Overhauling of the stores might be done which would prompt an expand the space of the store, give large amounts of comforts to the clients & convenience to the same while the clients lift, shop and peruse the items from the store (Ranchhod, 2004).

Competitive Strategy

It is not a simple task for an organisation to focus which approach might be selected at Topshop in order to remain stable in the era of strong competition. Moreover, at Topshop`s, the acknowledgment of the aggressive system should be done due to elevated amounts of separation. Accordingly, different separation techniques should be taken after remembering what the client needs, what do TOPSHOP offers it’s, and so forth. It might be seen that, clarity on the premise of separation ought to be polished at TOPSHOP. At TOPSHOP, a direct approach should be settled on. The direct approach took after at TOPSHOP would be to reduce the measure of the intended interest group, the business section to be focused on, whether TOPSHOP should exclusively centre upon stock or they might centre upon mid-reach showcases too to indulge expansive number of target customers (Dahlen, et al., 2010).

Strategic Issues in Top Shop

The strategic issues of the Topshop include the decisions that the organisation is taking for its future and the strategic strategies that are required to combat the future pressure on the business environment. In the case of Topshop, it is of ultimate significance which involves mainly its business level and corporate strategy for the growth of its business. Topshop had relied on the aspect of conformance for a long time in its business strategies including store design and similar layout. The Topshop also greatly rely on its suppliers. During the late 1990s, the customer reliance approach proved to be an effective business strategy because the company was globally expanding and embarking on the global level, especially in America and Europe, markets with substantial cultural differences. In the opinion of the Topshop, the customers, as compared to outside suppliers, regarded British suppliers as of high quality. In the context of overseas market, this was strategic failure as the company’s strategies were more products oriented and the company lost focus on consumer needs.  In addition Topshop did not notice the transitions that were occurring within the market.  The marketing strategies of Topshop were confined on the stores design and high cost strategies but due to high competition it turned ineffective.  In short the company did not embark on intense marketing as its marketing strategies (Ben-Daya, et al., 2009).

Apart from a competitive advantage, Topshop is attached with a number of problems. In 2000, the Topshop experienced its major declining phase. The problem that is faced by Topshop can be divided into two categories i.e. the core products and the culture.  The scenarios at Topshop revealed that there were a number of problems that Topshop is facing and some problems were well defined and apparent. The problems that were face by the Topshop in its competitive environment proved to be great hurdles in creating its mark in the competitors (Cunningham & Harney, 2012).


For Topshop, culture has been referred to as one of the major problems. Many managers at Topshop have tried to update the culture at the company but the results were not convincing. In Topshop, the managers observed that the company was instilled with old values and beliefs which were dominant across the entire organisation. The brand has a feeling that they have failed in best serving the customers in an effective manner due to the poor performance financial performance of the company. Still many old traditions, as well as culture, are being followed at Topshop amongst them was the approval of the various formalities i.e. the hierarchy system. Any changes cannot be made in the Topshop except with the prior approval of the Top management. In order to address the problems in the company in the best possible manner, various types of innovative practices and exercises shall be followed within the company (Grose, 2011).

Low Cost strategy

Lower cost strategies emphasizes on conducting operations by lowering the costs without essentially offering the market the lowest price. The company should focus on the use of resources that plays an integral role in fostering the efficiency in order to attain the aim of low cost strategy. This implies that the organisation that successfully implement lower cost strategy, offer its products in the market  at lower cost as compared to its competitors. Topshop can use and implement lower strategy to increase its share in the market. Topshop can also work on maintain its prices in order to increase the profit per unit as compared to the other competitors (Choi, 2013).  The principle idea behind the low cost strategy implies that the prices and cost are not dependent and the strategy is more about achieving a status in the market. The company can also use low cost strategy to increase its profitability. An effective decision for the company would be to devise an integrated strategy that entails the combination of both differentiation strategy and cost leadership strategy. This integrated strategy can also help the company in controlling its core competencies and in adapting rapidly to changes in the market in order to gain competitive advantage over the competitors (Boyes, 2010).

Organisational capabilities of Topshop can be characterized as assets and strategies that depict a mind-set and choice making rules that are appropriate for the different useful units of the business, with the fundamental target of assistance the acknowledgment of business objectives and goal. The detailing of these techniques is done at the useful level, for example, promoting, money, human asset, generation, and utilitarian units inside of the association. The hidden target behind depending on hierarchical capacities and assets is to accomplish things in suitable way with a specific end goal to encourage the acknowledgment of organisational development and advancement. Practical techniques are basically concerned with the improvement and development of an one of a kind capability to make the firm or a particular useful component of the business to pick up an upper hand (Grose, 2011).

Organisational capabilities of Topshop are an imperative component in hierarchical development attributable to the truth they improve the viability and proficiency of the decision-making procedure; they give a system to designating power and encourage powerful correspondence. Furthermore, abilities offer disentanglement towards the control of hierarchical procedures, and in particular, they offer a system for encouraging authoritative development and steadiness. The centre components of authoritative capacities incorporate the different utilitarian methodologies that can be conveyed with a specific end goal to urge hierarchical development in an aggressive situation incorporate promoting methodology, budgetary technique, HRM procedure and data administration method (Jackson & Shaw, 2008).


Current Strategic Management Policies and its Effects on Topshop

Their strategic management policies have enabled the company to successfully operate in a number of countries and have helped the company in opening its fully owned stores worldwide. Due to its strategic management policies, the recent 5th avenue of Topshop store also achieved winning combination of press engagement and customers. The company is adopting same expansion strategy to open its fully owned store in Amsterdam. The company is already present in the Europe through the franchise with Galleries Lafayette and others. Due to the already existing franchise, the company owned store would be enjoying a welcoming attitude in the market. The company is also focusing its effort to enter the lucrative market of Asia (Gordon, 2014).

Topshop is more challenged both externally and internally when its digital and multi -channel story is analysed. The internal perspective of the company unfolds that the IT and group structure of Topshop is more evident as compared to its buying marketing and merchandising functions. The even partially shared group infrastructure of the company drives complexity and cost and in this digital age where all the retailers are going digital, the company can cope with this market trend with its fair share of legacy systems. However, this digital age has cost the Topshop to suffer from the in competitive offer in the market in this demanding and fast moving fashion world (Ben-Daya, et al., 2009). The Topshop is still in need to adopt the effective customer proposition, as currently the Topshop is unable to recognise the value of its store stock. The company should learn to manage its single pick inventory in order to experience efficient results. The company is also looking forward to upgrade its digital system by entering into deal with oracle. The company is also looking forward to improve its warehouse and inventory system, merchandising, and ranging. This deal and investment is very significant for the company at it will strengthen the back end system and will help the company to compete in medium to long term. However, the company is in need to focus and allocate its resources equally on front-end system, data recording, and storage and customer experience (Grose, 2011).

Currently, the digital practice that is adopted by the company as part of its current strategic management policies is comprehensible yet disjointed. The company’s digital system provides all the facilities that are expected by an ordinary customer i.e. browsing, combing orders, mobile apps and social platform and sharing across the web.  In spite of providing all the expected experiences to the customers, the company is still unable to provide the customer with the differentiating experience and more importantly, in this multi-channel age, the digital experience of Topshop is disjoined.  The standalone site of Topshop is its blog, which is not integrated into web. The online shopping store of Topshop provides its customers a promising experience by offering a wide range of shopper types. The focused strategic management policy of Topshop has enabled the Topshop to standout in the market but still in this ever-increasing competition, the Topshop should come up with new idea in order to provide distinct experience to its customers. Topshop socially connect its customers with the events through engaging them via instagram and special guest’s bloggers (Rafiq, 2014).


Due to its effective strategic management policies, Topshop is enjoying a good recognition in the market. However, the company is not performing to out race its competitors, but it is still well-known among the customers. The company’s strategic management policies are value driven but the brand still lacks in in performance in online marketing. The company should also develop other policies in combination with current product proposition in order to gain create its mark among the competitors. The company should also provide convenient pickup locations to facilitate its customers and this would also help the company in eroding other fashion brands in the market. Topshop’s strategic management policies and decisions are based on building and digital customer experience. Since for the fashion brand the PR and activity remain attached to fashion, product and press, the Topshop has to work on effectively on these areas in order to gain a competitive advantage in the market. The Topshop should put the customer experience at the heart of the digital experience in order to explore and enjoy the full potential of the market.


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