Case Description

Retail Inc.
CASE DESCRIPTION
Welcome to my Retail Inc Empire!
I would like to formally welcome you onto the management role for my Retail Inc. store. I have chosen
you to take control of the company based on your experience, intelligence and potential for managerial
excellence. The previous manager, Mr McMillan, decided that the role was no longer what he was
looking for. To be honest, I was quite sad to see him go.

Now that you are on board however, I am charging you with the responsibility of establishing a new
direction and strategy for the company. The clothing store space is getting increasingly competitive with
the entrance of some big players and now, more than ever, we need to be SMART. I believe that your
previous experience in the industry means you will be perfect suited to lead my operation into the future.

I shall be watching and monitoring your performance closely. If you are more successful in managing the
site than your competitors, you will be rewarded with a permanent role on the management team. If your
results are not favourable however, I will replace you immediately.

In brief, I am looking for the management team which can generate the highest profits in the forthcoming
quarters by optimising the current site. Your team has total control of all operations including pricing
policies, staffing, marketing, changing shelf items, customer service issues and so forth.

I have enclosed information about the company background, the current and potential clothing store plus
the latest market research report which should help you to plan your team’s next move.

I wish you every success in this endeavour and look forward to reviewing your progress.

Mrs. Costalotta
Retail Inc owner and entrepreneur

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Retail Inc.
CASE DESCRIPTION

A BRIEF OVERVIEW

Approx. Retail Sales Space: 300 m2

LOGISTICS
A large impressive site with relatively new fixtures and fittings. The following product categories are
available in store: Season men, Season women, Basic men, Basic women, Shoes men, Shoes women,
and Children.

The shop is located in a premium shopping mall in the city centre which is easy to reach by public
transport.

STRATEGIES MOVING FORWARD

While the store continues to receive satisfactory customer reviews and stable sales in the last quarters,
we believe that its growth potential is not fully exploited. The revenue growth rates over the past few
quarters have gradually decreased. The Headquarters has published the new guidelines, which allows
each store to adjust some of the key sales elements, such as the prices, advertising budgets, layout of
the shop etc. according to its own situation. By doing that, we aim to introduce more flexibility into the
whole group and thus respond better to the fast changes in the market. At the same time, it is strongly
recommended to carefully analyse the figures of the previous round (quarter) before making any new
managerial decisions.

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Retail Inc.
CASE DESCRIPTION

FURTHER BACKGROUND
Retail Inc. has been in the industry for nearly 30 years. It has been operating dozens of stores across the
Europe for decades. It has undergone many changes under the tenure of the old manager McMillan,
who proved to be a good operator but not very efficient in building customer relationships. The last two
years have seen slowly dwindling profits for this store.

Despite the positive growth rate in the industry over the past few quarters, Retail Inc’s clothing stores
have struggled to meet the previous year’s earnings forecast.

OPERATING ENVIRONMENT
Each competing management team is in charge of an individual clothing store but these stores share the
same characteristics. You will therefore be in direct competition with the other teams. The other stores in
the competition should allow you to compare your results and level of performance.

All stores are situated with exactly the same location variables and have the same product categories.
Their historic performance and economic and financial conditions over the previous quarter are exactly
the same.

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Retail Inc.
CASE DESCRIPTION

MARKET RESEARCH REPORT

Prior to his departure, McMillan had contracted a marketing agency to carry out a market research study
on customer preference for each of the products sold in the store. Unfortunately, his tenure ended
abruptly, but here is the information.

RESPONSE TO
CATEGORY EXAMPLES OF ITEMS PREFERENCES
PROMOTION

Season T-shirt & Polo, Shirt, Pullover, Sweatshirt,
men Jacket, Pants, Jeans, Bermuda Shorts,
Jogging Suit, Coat & Blouson, Pyjamas,
Underwear, Socks
Customers interested in well- HIGH
advertised products. Service
is important as well as the
price. Placing the products in
some obvious locations would
also help.

Season T-shirt & Jumper, Shirt & Blouse, Pullover,
women Sweatshirt, Jacket, Pants, Cropped Pants,
Jeans Underpants & Leggings, Skirts, Robe,
Jogging Suit & Jumpsuit, Coat & Blouson,
Pyjamas & Nightdresses, Underwear, Socks
& Tights
Customers interested in well- HIGH
advertised products. Service
is important as well as the
price. Placing the products in
some obvious locations would
also help.

Basic men T-shirt & Tank-top, Pullover, Sweatshirt, Customers for this category LOW
Jacket, Pants, Overalls, Underwear, Socks are less price-sensitive. They
are more concerned with the
quality of the products.

Basic T-shirt & Tank-top, Pullover, Jumper, Jacket, Customers for this category LOW
women Pants, Leggings, Robe & Skirt, Underwear, are less price-sensitive. They
Socks & Tights are more concerned with the
quality of the products.

Shoes men Sandals, Sportswear, Casual Shoes, Dress Not very price-sensitive but MEDIUM
Shoes, Boots the sales, cleanness,
merchandising, in-date stock
are important.

Shoes Sandals, Sportswear, Flats, Pumps, Boots Not very price-sensitive but MEDIUM
women the sales, cleanness,
merchandising, in-date stock
are important.

Children T-shirt & Tank-top, Pullover, Jumper, Jacket,
Pants, Leggings, Robe & Skirt, Underwear,
Socks & Tights
Not very price-sensitive but MEDIUM
because of convenience they
will be influenced by the
promotion, events and visits to
the store in general.