Tiffany & Co.

Business Strategy Analysis

Susan Tartara, Christina Caamano, Sara Birnbaum, Corinne White MBAe 2010-2

•Environmental Analysis •Strategies •Corporate Governance •Organization •Leadership •Entrepreneurship •S-Curve •Discussion

Personality • Customer Service Orientated • Greater than normal Training for sales representatives • Dedicated to the “Tiffany Experience” • Brand Loyalty is sustainable .Internal Environment People. Philosophy.

Internal Environment Competencies • Customer Service • Design and Innovation • Marketing and Brand Maintenance • Quality and Craftsmanship .

Internal Environment Resources • Sourcing Socially Responsible Materials • Access to excellent talent • Design • Marketing .

SWOT Analysis Weaknesses Strengths Brand Financials Quality Control Distribution Control Internet Shopping Embraced Mature in Industry Lifecycle Commodity Prices Recessions Reduced Discretionary Spending Opportunities New Target Markets Online Market Threats Rivalry Cheaper Products Revamp Advertising Socially Responsible Mining Vertical Integration Product Differentiation Innovation Comparable Products Online Retailers Low switching costs Dependence on stores .

Value Chain Analysis .

Support after sale .customer needs Service.Value Chain of Tiffany Co In Bound Logistics.Warehousing for finished products Marketing and Sales.Warehousing of raw materials and the distribution to their manufactures Operations.transforming inputs into finished products Outbound Logistics.

Employee recruiting. compensation. equipment . control systems HR Management.Organizational structure.Support for the Value Chain Infrastructure of the firm. training Technology Development.Value creating services Procurement. company culture.Raw materials.

Cost Advantage of the Value Chain Economies of Scale Learning Capacity Utilization Linkages among activities Degree of Vertical Integration Timing of market entry Firms policy of cost or differentiation Geographic Locations .

Competitors • • • • • • Cartier BVLGARI Harry Winston Chopard Fred Leighton Michael Katz .

Competitive Strategy • • • • Differentiation strategy Brand loyalty Price sensitivity Value creating strategy .

Competitive Strategy • Increased marketing • Accelerated pace of store openings . handbags and accessories • Expansion of internet sales.launch of online business in continental Europe .17 stores • New product expansion.Yellow diamonds.

Global Strategy Tiffany’s global locations: • America’s • Asia Pacific • Europe Internet sales Business to Business (B2B) Wholesale Distribution .

. versus 206 locations a year ago (86 in the Americas. 102 in Asia-Pacific and 27 in Europe vs. • The Company operated 220 TIFFANY & CO as of January 2010 91 in the Americas. 96 in Asia-Pacific and 24 in Europe). eight in Asia-Pacific and three in Europe).Tiffany Global Expansion • Opening of 17 new Company-operated stores (six in the Americas.

Curve Analysis • The specialty retail industry is currently in the mature stage of the industry life cycle • From the 1970’s to the 1990’s.S . Companies of all sizes are able to offer their products online to a larger consumer base then previously possible . the specialty retail industry experienced a large growth with the increase in shopping malls in the United States • A channel being used for many specialty retailers to grow is the internet.

S-Curves TIF .

71bn. • Balance sheet liquidity at January 31. sales rose 14% to $318.0 million in the fourth quarter due to strong growth in all countries except Japan .Finanical Snapshot • For the year.2m on the back of aggressive cost-cutting. net sales dropped 5 % to $2. But net earnings from continuing operations rose to $265. • S G and A expenses rose 7 % in the quarter. • In the Asia-Pacific region.7m from $232. and total short-term borrowings and long-term debt of $754 million (versus $709 million a year ago). as a result of higher incentive compensation for management. 2010 included: cash and cash equivalents of $786 million (versus $160 million a year ago).

Retail vs Jewelry Sales 19 .U.S.

S.U. Specialty Jewelers Sales 20 .

6 million in last year's fourth quarter • Tiffany’s planned capital spending is jumping to $200m. from $75m last year .Financial Snapshot Q1 2010 • Net sales increased 17% to $981. compared with $837.4 million.

• To increase store productivity • To achieve improved operating margins • To enhance customer awareness • To maintain an active product development program • To provide superior customer service . • To selectively expand its global distribution without compromising the value of the TIFFANY & CO.Key Strategies of Tiffany &Co. trademark (the “Brand”).


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