Tuesday, February 11, 2020

Critically examine the international expansion strategy for an Essay

Critically examine the international expansion strategy for an organisation of your own choice during a specific period of its e - Essay Example The clothing and accessories offered often depict young male and female models with aesthetic facial and body features in order to gain marketing interest in their target market of 18-35 year old buyers. This exclusive mentality positions them differently from main competition, such as the Gap and H&M, allowing them to retain considerably high market share among the competitive environment both in its home country of the U.S. and its new expansion locations internationally. This essay describes the current strategic management functions and principles at A&F related to their current, ongoing expansion strategy. A&F statistics and sales At the end of 2010, Abercrombie & Fitch operated 1,069 stores. These included 316 A&F stores, 502 Hollister Co. stores, and 181 Abercrombie stores dedicated to children and adolescent youths (euroinvestor.co.uk, 2011). The company has adopted many different strategies in an effort to gain more customer interest and improve market share. However, it has never lost focus on its core competencies and core products, which are often provocative and always exclusive fashions that are heavily branded with the Abercrombie & Fitch name and/or logo in order to help customers identify with their name and reputation. In previous years, from 2007 to 2009, A&F experienced considerable losses in profitability that came from a variety of factors, including economic downturns in the international economies and changing buyer behaviours. However, through aggressive advertising and downsizing of underperforming stores, Abercrombie & Fitch has managed to regain its competitive edge and just recently experienced a 7.6 percent increase in sales for the last quarter of 2010 (Stothard, 2011). Again, this is due to a strategic focus on remaining dedicated to the core brand philosophy of exclusivity, a series of short-term pricing reductions and the closing of non-performing stores internationally (especially in the United States where the economy has bee n poor). Strategic focus and intention In order to fully understand the international expansion strategy of Abercrombie & Fitch, it is necessary to identify with the concept of strategic management and leadership. â€Å"Strategic management is based on the belief that an organisation should continually monitor internal and external events so that timely changes can be made as needed† (Aluko, Odugbesan, Gbadamosi & Osuagwu, 2004, p.44). There is a need to be adaptable to change and be trend-focused so that their product offerings and values can shift along with changing environmental, economic and consumer behaviour trends related to retail buying. Strategic management, then, is a â€Å"continuous process of administering operations with an emphasis on overall corporate purpose and future opportunities† (Stone, 2010, p.S215). Abercrombie & Fitch is a very strategic-focused business that is always operationally-adaptable in the face of these conditions, however it never loses focus of its core mission and core competencies related to marketing and branding which are their most priority revenue-building strategies. Abercrombie & Fitch is currently closing underperforming stores in the United States and abroad, based on same-store sales and economic conditions in their current operating environment. However, these closings offer the

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