Creating a sound business strategy that functions as the cornerstone for consistent growth, claiming expanding market share and receiving a solid return on investment is not easy. The fluctuating global economic climate and the challenges inherent in South Africa’s economy such as declining consumer confidence make developing a winning business strategy touch. However a number of South African companies have found a formula that works for them.
Woolworths is one example of a company with a strong business strategy. Woolworths has claimed increasing market share, seen a surge in turnover and has expanded the brand’s footprint in South Africa and beyond. Mr Price is another SA success story, showing increased profits, improved sales growth and resilience even in difficult financial years. Seartec has seen significant expansion through its acquisition of a diversified portfolio of complementary brands and an overhauled product offering and strong revenue growth.
While each of these businesses are very different, their business strategies have a number of key points in common:
– Strong leadership
Each of these businesses have benefited from focused management that adopts a “lead from the front” approach. In the case of Woolworths, Ian Moir has seen decreased costs and increased profitably during his tenure as CEO, while the appointment of dynamic duo Mark McChlery and Bob Skinstad as Seartec’s CEO and CMO respectively has brought renewed energy to the organisation.
– A diverse product offering
Mr Price’s initial offering was fashion apparel, but the brand has since diversified into sporting apparel and homewares such as textiles and furniture. Woolworths not only sells homeware and clothing, but has been well-received as a food and grocery outlet. Seartec has recently acquired a number of businesses, including Limtech Security Solutions; OfficeBox, an online stationery supplier; and FuzeCloud, a provider of cloud-based solutions. Seartec’s idea is to give clients a one-stop shop where they can access an integrated package of products that fits all of their needs in the technology space.
– A strong and streamlined online component
No business can ignore the impetus to have an online presence, but a strong business strategy takes it one step further. Modern consumers have the internet at their fingertips and providing in-depth information and the ability to shop online is becoming more and more critical. Mr Price has responded with a comprehensive e-commerce offering, while Seartec has provided an extremely fresh take on the normally onerous task of shopping for office supplies with simple and smart online (and overnight) supplier OfficeBox.
– An emphasis on creating value
Every consumer is looking for the best deal. Even if their offering is a luxury item, businesses need to deliver exceptional value or risk losing a client. Woolworths acknowledged this with an aggressive strategy that incorporated weekly promotions at a substantially reduced cost and benchmarking of product prices to ensure that they remained competitive. This has netted the brand a sharp increase in customers from lower LSM groups as well as their traditional high LSM shoppers. Mr Price has acquired a name as a retailer that stocks trendy and desirable items at an affordable price. Seartec gives their clients unique rental finance options in order to fix their asset costs. Comprehensive after-sales service and support also provides added value.
In conclusion, these businesses have been able to weather the changes in the market and stay ahead of the curve by keeping flexible, embracing change and remaining dedicated to meeting the needs of their current and prospective clients. Business managers and leaders need to push to do the same when formulating a business strategy in order to remain competitive.
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