finalsears - Sears Roebuck Co. Sears Anonymous Consulting...

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Unformatted text preview: Sears Roebuck Co. Sears Anonymous Consulting Vasco Chu Felipe Vasquez Charles Toler Company History Company Founded in 1886 by Richard Sears Originally in business as catalog based Originally company company • Started as watch retailer, yet expanded to full line Started retailer retailer Opened first Brick and Mortar Opened establishment in 1925 establishment Company Overview Company Second largest broadline retailer in the U.S. 2003 revenues topping $41.1 billion 2003 Listed #32 in Fortune 500 rankings Employing more than 200,000 workers domestically Compared to the Market cap weighted average, Sears is Compared at 5.8% at Company Overview Company Financial Services Provide financing on products to over 60 Provide million customers million Over 14 million service calls placed to Sears Over annually annually 870 full line stores 870 1,100 specialty retailers Product Repair Services Exposure Financial Analysis Financial Major competitors Wal-Mart Target JC Penney Profit Margin Sears WalMart Target JCPenny 2003 8.26 3.50 3.82 (5.22) 2002 3.33 3.44 3.77 2.3 2001 1.79 3.2 3.43 5.42 2000 3.29 3.26 3.43 (2.21) 1999 3.69 3.22 3.39 1.06 Ratio used to evaluate company efficiency in controlling costs and expenses related to sales Ratio Profit Margin (PM) 10.00 8.00 6.00 4.00 2.00 0.00 03 02 01 00 20 20 20 20 99 PM asa Percentage Sears Wal-Mart Target JC Penney 19 -2.00 -4.00 -6.00 Year As of 11/10 2004 Industry Average is 3.82 Inventory Turnover Sears Wal-Mart Target JC Penney 2003 7.64/48 days 7.79/47 days 5.98/61 days 3.30/111 days 2002 7.84/47 days 7.58/48 days 6.39/ 57 days 3.48/105 days 2001 7.56/48 days 7.22/51 days 9.57/38 days 3.27/112 days 2000 7.24/50 days 7.29/50 days 13.50/27 days 6.06/60 days 1999 7.3/50 days 6.55/56 days 12.68/29 days 6.64/55 days As a general rule the higher the inventory turnover, the more effective the company is in its operations and the lesser amount of investment tied up in inventory Inventory Turnover 16.00 14.00 12.00 10.00 8.00 6.00 4.00 2.00 0.00 20 02 20 00 19 99 20 03 20 01 Number of Times Sears Wal-Mart Target JC Penney Years Earnings Per Share Earnings Sears Wal-Mart Target 2003 11.86 2.03 2.02 JC Penney 1.26 2002 4.94 1.77 1.82 1.12 2001 2.24 1.44 1.52 0.71 2000 3.88 1.41 1.4 1.04 1999 3.81 1.25 1.32 1.58 Ratio used to show the amount of earning attributable to each share of common stock held by stockholders Earnings Per Share 14.00 12.00 10.00 8.00 6.00 4.00 2.00 0.00 20 03 20 02 20 01 20 00 19 99 Dollar Value Sears Wal-Mart Target JC Penney Year SWOT Analysis SWOT Analysis Strengths- Favorable brand image, Quality Service/Warranties, Favorable Ownership of Private Brands, Unique Services Ownership Weaknesses- No real niche, indecisiveness within industry, not adapting quickly and effectively to changing consumer trends adapting Opportunities-Sears can differentiate from competitors by Sears personalizing customer service, focus on shifting power from HQ to individual stores, Establishing mortgage programs for low income areas to receive incentives from city or county to establish customer loyalty loyalty Threats-Online merchants entering with low barriers to entry such as Online Dell in the Consumer Electronic Industry, New SupercenterDell competitors take away up to 30-40% in revenues of mall-based competitors retailers, Sears must model efficiency in logistics by their top competitors competitors Strategic Recommendation Strategic Sears Grand Complete “one stop” facility, even encompassing Complete grocery department grocery Withdrawal from less profitable mall-connected Withdrawal outlets outlets Effects of poor performing areas on overall profitability Utilize private, recognized brands as selling points Increase visibility of high performing brands Differentiation Strategic Recommendation Strategic Implementation of “Super Center” throughout all Implementation domestic markets domestic Everything offered by sears, and more to entice new or skeptical Everything consumers consumers Competitive advantage with sales of certain items not Competitive found with competitors found Large Appliances, Window Blind cutting, café/bakery, pest Large control control Brand recognition to comfort consumers Offer same services customers have come to know from Offer traditional Sears stores in newer facilities traditional Strength of private brands to support larger retail centers Strength Rationalization Rationalization Adaptation to changing market Conforming to change in customer Conforming preferences for convenience preferences More services and products are offered More than those of competitors than Thank You Thank Bob Case Friday 9:00 – 10:20 Anonymous Strategic Analysis #2 ...
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This note was uploaded on 08/10/2010 for the course BUS 100 taught by Professor Na during the Spring '04 term at University of Central Florida.

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