贝恩-行业分析方法-行业分析-RetailCo1016.ppt

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1、bc,Compiler:,Reviewer:,Retail Co.,Created:August 26,1999,Copyright 1998 Bain&Company,Inc.,Seva Rozanov,Thomas Shannon,2,RetailCo2,BackgroundApproachConclusionImplementationResults,Agenda,3,RetailCo2,Retail Co is$10+B“speciality retail”conglomerate whose financial performance has deteriorated since 1

2、990,Background,4,RetailCo2,Achieve top quartile performancemarket/book value:2.8xreturn on equity:17-18%annual earnings growth:10-12%,Divest businesses that are poor fitsPrepare the company to weather challenging industry conditionsCreate a compelling vision and growth strategy,Financial Objectives,

3、Strategic Objectives,Background,Retail Co Objectives,5,RetailCo2,Agenda,BackgroundApproachConclusionImplementationResults,6,RetailCo2,Define the characteristics of a successful strategy Develop a range of viable strategic alternativesAssess and prioritise the strategic alternativesBuild consensus ar

4、ound the preferred strategyFully quantify the impact of appropriate action stepsGain final approvalLaunch implementation,Approach,7,RetailCo2,Components of Successful Strategy,Doable:,Evolves from current business mixFits Retail Cos core competenciesIs fundableDevelops significant competitive advant

5、agesCapitalizes on the volatility of retail cycles,Understandable:,Communicates a clear and compelling approach to the businessWill be fully valued by analysts and shareholders,Desirable:,Creates clear economic value and top-quartile financial resultsbuilds a portfolio of high-potential businessesma

6、kes business units more valuable to Retail Co than to othersAvoid excessive layers,overheads,and decision processesIs attractive to key managers in targeted businesses and functions,Approach,8,RetailCo2,Market sizeMarket growthSegment returnsSegment profitability trends,Competitive intensitySupplier

7、 powerSegment stability,Market Attractiveness,Market shareMarket share trendGeographic coverageCurrent profitability/EVAEarnings trend,Management teamRetail brand equityInfrastructure and systemsCustomer value proposition,Strategic Position,Corporate experience,skills,and valuesCorporate functional

8、support,Corporate portfolio developmentCross-divisional sharing,Fit,Retail Co businesses were evaluated along three groups of criteria,Approach,Revising the Mix of Businesses,9,RetailCo2,Fact Base,The five questions approach was used to build fact base on every business of Retail Co,Approach,10,Reta

9、ilCo2,Agenda,BackgroundApproachConclusionImplementationResults,11,RetailCo2,Business Unit Evaluations(1 of 2),Division,Conclusion,Strategic Position,Market Attractiveness,Fit,North,Large market ready for consolidation,good profitability,very strong position,Holland,Large potential market with opport

10、unity to boost growth and profitability through acquisitions and improved operating efficiency,Italy,Rapidly growing channel with high returns.Need to invest to capture market share and improve operating efficiency,Hong Kong,Large overall market with slow growth.Cash provider capable of funding grow

11、th businesses,Luxembourg,Reevaluate growth plans.Economies of scale not yet achieved but segment extremely profitable,Conclusion,12,RetailCo2,Business Unit Evaluations(2 of 2),Britain,Moderate size segment with good profitability but strong competition;declining market share,low relative operating m

12、argins,Ireland,Declining market segment,poor position,little opportunity for sale,potential for savings by folding into Hong Kong,France,Overcapacity in segment,losing market share,below average profitability,Sweden,Large overall market but requires substantial investment to develop new products and

13、 achieve scale to improve cost position;business has poor fit with Retail Co skills,Spain,Small segment,low growth,high volatility,and seasonality,Division,Conclusion,Strategic Position,Market Attractiveness,Fit,Conclusion,13,RetailCo2,Business Unit Recommendations,Division,Strategic Position,Market

14、 Attractiveness,Fit,Grow(Spin Off),North*,Holland,Italy,Hong Kong,Luxembourg,Hold,Britain,Divest,Ireland,France,Sweden,Spain,*SpinOff,Conclusion,14,RetailCo2,Strategic Alternatives,Long-term vision:,Corporate profile:,The leader in selected business lineschain drugapparelfootwearhometoys,Business li

15、ne competencies,Cost and experience sharing in the groups,Acquisitions to achieve business line dominance,Group-based organisation,A balanced portfolio of speciality retailers,Resource allocation competenciesLean corporate structure,Decentralised management,Grow and keep successful businesses.Divest

16、 the unsuccessful,A leading developer of targeted growth-stage retailers,Selection and expansion competenciesCorporate expertise in critical growth functionsbusiness development(R&D and research)real estatesystemslogistics,Cost and experience sharing in key activities across all businesses,Acquire a

17、nd grow promising concepts.Divest when value-added peaks,Conclusion,Group Specialist,Retail Conglomerates,Growth-stage greenhouse(Retail Co.“Classic”),15,RetailCo2,Revise the mix of businesses in the portfolioallow North to pursue an independent strategysell France,Spain and Sweden at the right pric

18、e and timeEnsure remaining businesses address the most important strategic issuesestablish clear strategies for growth businesses(Holland,Luxembourg,Hong Kong,Italy)finalise turnaround plans for businesses which cant be sold at reasonable pricestake write-offs as requiredConsider acquisitionsReduce

19、corporate expensesAdd value to the businesses in the portfoliobuild R&D capabilitiesleverage costsupgrade the organisation,Conclusion,Action Recommendations,16,RetailCo2,Chain drug industry is consolidatingeconomies of scale in systems investmentsrelationships with third-party payersAn independent N

20、orth generates significantly more shareholder value as it participates in the evolution of the industryNorth makes minimal use of corporate functions;there is little cost-sharing among North and the other divisionsMarket timing is attractiveNorths value is not being fully recognized in the marketpla

21、ce,Conclusion,Example:Rationale For an Independent North,17,RetailCo2,Planned capacity additions will result in industry-wide negative comp store sales through 1998Consolidation is essential to eliminate excess capacitylowers costsallows comp store sales growthRetail Co is better suited to be a sell

22、er than a buyersynergy is equal whether France chooses to acquire or be acquiredleading competitors market value is highermanagement group at France has several significant holes,Conclusion,Example:Rationale for the Sale of France,18,RetailCo2,Continue to pursue opportunities to consolidate and redu

23、ce over-capacityFill key executive openingsRestore the historical bargain edge with core customersincrease the mix of opportunistically-purchased goodsdeliver values averaging 20%below department store sale pricesReduce costs to support price reductionsreduce overhead costs by approximately$60MMredu

24、ce investment cost for new stores and remodelsClose unprofitable locations and exit several markets which France cannot dominate,If the sale of France takes longer than anticipated,several actions will be taken to improve Frances performance:,Conclusion,Example:France-Strategic Imperatives,19,Retail

25、Co2,Vision:,To consolidate our position as the leading widget retailer to our target customers(high-volume purchasers of trendy widgets in their 20s and 30s)To be recognized by our target customers as the leader in product assortment and customer service for widget retail(our unique positioning)To r

26、each a 10%share of the national widget retail market by the year 2000,Financial Goals:,To reach and maintain ROIC levels of 20%To grow sales by 5%per year and net earnings by 10%per year1998 sales objective:$1,225MM1998 net earnings objective:$47MM,Strategy Summary(1 of 2),Conclusion,20,RetailCo2,Ke

27、y Imperatives,Initiatives,Develop our new concept,Widget Factory,into the second-largest non-mall based widget retailer,Retail Co Real Estate audit of potential new sitesWidget Factory rapid deployment initiative(opening of 30 new stores per year,Close non-performing stores,Closing of the 10 worst p

28、erforming mature stores(both XYZ and Widget Factory)each year,Improve margins by changing mix and reducing costs,Mix change based on GMROI approachImplementation of 4-Walls systemRedesign of logistics flow based on Retail Co studyImprove density of markets by backfillling five markets,Modify our ima

29、ge in the eyes of the customer,Assortment redesign based on demand and profitabilitySales force training initiative on customer serviceLaunch of a new advertising campaign,Focus new stores in Southern geographies,Acquire and integrate Southern Widget by end of 1996Retail Co Real Estate audit of pote

30、ntial new sitesProposed partnership with Southern Malls,Inc.,Strategy Summary(2 of 2),Conclusion,21,RetailCo2,Fit with Retail Coclear opportunity for value creationpotential to maximize sharing with related divisionsMarket attractivenesssubstantial market potentialdominant market position opportunit

31、yconcept in early stages of a long lifecycleFinancial opportunitiesaffordable within target capital structuremeets minimum return and growth hurdlesLimited risk factorsexisting management talent or supplementablelow to moderate volatility,Conclusion,Criteria for Acquisition,22,RetailCo2,Corporate Co

32、st Reduction Opportunities,*Excluding interest,Conclusion,23,RetailCo2,Primary Levers:,Corporate Roles:,Keep aware of market and customer trends driving potential opportunitiesDevelop criteria for screening acquisitions and partnerships or alliancesIdentify and evaluate new concepts and consolidatio

33、n opportunitiesDevelop a network of deal contactsStructure,negotiate and close dealsCoordinate effective integration planningEvaluate opportunities to spin-off/exit businesses,Define primary measures of financial performanceSet specific financial return and earnings growth targetsDevelop financial p

34、lanning and control systemsAllocate capital and other resources,Define management decision-making processesCoach divisional managementfocus managers on measurable resultsquestion assumptions and challenge thinkingProvide leadership on critical issues(e.g.,division strategy,value disciplines,and prio

35、rity and resource conflicts)Identify opportunities to improve operations and set specific improvement goals,Primary Levers Available to Add Value(1 of 2),Conclusion,24,RetailCo2,Primary Levers:,Corporate Roles:,Instill company wide commitment to spreading best practicescoordinate regular experience

36、sharing at all levelsfacilitate communication among divisions and functionsDrive value disciplines to improve operations across all processes,functions and divisionsProvide leadership and expertise to support improvements in performance,Attract,motivate and retain the best managementrecruit top tier

37、 candidatesreward based on performancepromote based on abilityProvide strong,profit-related incentives linked to corporate objectivesRotate managers across functions and divisionsDevelop formal training programs,Perform analysis to support strategic decision-making(corporate and divisional)Define co

38、rporate strategic directionAssess market attractiveness,performance,position and fit of divisionswork with divisions to build high-quality,fact-based strategic plansIntegrate division plans with corporate strategy,Provide scale services and functions to achieve lower cost and higher qualityLeverage

39、infrastructure across businesses,Primary Levers Available to Add Value(2 of 2),Conclusion,25,RetailCo2,Projected Earnings,North,New Retail Co,*From Monte Carlo analysisNote:Earnings equals net income after taxes and interest,Conclusion,26,RetailCo2,*With$300MM share repurchase,Gap vs.SBP Projections

40、,Gap vs.Realistic,ROE target:ROE*:(Gap)/surplus:,11.1%12.0%$10.8MM,15.9%19.2%$35.6MM,17.0%21.6%$61.3MM,11.1%9.4%($22.4MM),15.9%13.4%($28.6MM),17.0%14.9%($30.2MM),Conclusion,Gap Analysis,27,RetailCo2,Agenda,BackgroundApproachConclusionImplementationResults,28,RetailCo2,Corporate Governance,The decisi

41、ons of the Board will be evaluated under the traditional business judgement rule standardThe distribution of North should not require shareholder approvalthe distribution is a dividend which requires only board approvalAT&T precedentThe potential divestitures should not be considered a sale of subst

42、antially all of Retail Co remaining assetsNew Retail Co will be a substantial entity with estimated sales of$4.2B,net income of approximately$119,and assets of$2.1B,Implementation,29,RetailCo2,Note:Distribute North stock dividend at appropriate time,3Q95,4Q95,1Q96,2Q96,3Q96,4Q96,1997,Approve all com

43、ponents of Strategic Review,Close France transaction,Close Spain transaction,Close Sweden transaction,Reorganize Corporate office,Close loss stores,Close North IPO,Complete merger of Ireland/Hong Kong,Complete MIS and telecommunications outsourcing projects,Pilot centralization of Accounts Payable,G

44、eneral Accounting,and Sales Audit,Spin-off North,Initiate merger of Ireland and Hong Kong,Implementation,Timing,30,RetailCo2,Strategy,Corporate managementCorporate employeesDivision presidentsDivision employeesMediaFinancial communityRetail industry consultantsIndividual shareholdersLandlordsVendors

45、/factorsLocal officials,Initiate all communications from Retail Co headquarters in order to maintain controlled,consistent messagesFully explain the rationale of the plan and how it will enable Retail Co to take advantage of its unique strengths,skills,and opportunities over the long termDefine a cl

46、ear strategy and vision for Classic Retail Co going forwardExplain how the plan is expected to enhance shareholder valueAssure employees in divisions slated to be spun off or sold that Retail Co will do everything possible to ensure an orderly transition and communicate potential benefits of the pla

47、n for these divisionsInitiate direct contact with all landlords who will be affected by store closings on announcement day,Target Audiences,Implementation,Communications Plan,31,RetailCo2,Agenda,BackgroundApproachConclusionImplementationResults,32,RetailCo2,Increase in Shareholder Value,Results,Market capitalisation has increased by 60%upon the implementation of the recommended strategy,Note:Excludes over$1 per share(105 MM shares)in dividend payment over the period,33,RetailCo2,青苹果出品 必属精品http:/,囊括2007-2010几百G地产策划资料/企业管理人力资源全套/品牌策划资料/行业分析报告/PPT模板等。,