1.0 Introduction

This report will prepare to provide a brief overview of Poundstretcher, how Poundstretcherapplies strategic management framework in their businesslike Porters Diamond Model, Mckinsey 7s Framework, Porter’s five forces model also presentsan analysis of the global strategy of Poundstretcher in international markets like Porter’s Competitive strategies to analyze for Poundstretcher’s international business and Integration Strategy and Strategic Alliance. This report also shows ways that Poundstretcher will use to expand its business internationallyaccording to the business pattern licensingmodel and the joint venture will be appropriate for Poundstretcher. Finally provide recommendations to increase Poundstretcher’s competitiveness in the international market.

1.1  Overview of the Poundstretcher

Poundstretcher was established in 1981. It is a retail brand of homeware brand, toiletries and quality food and offers different products. Poundstretcher has 350 outlets nationwide and offers quality products to its customers. They provide highquality products at a competitive price they also offer furniture, toys for children, toilet products, appliances, cleaning products, beds etc. They also have a pet hut section where they sell pet care products (Ghobakhloo and Fathi, 2019). Poundstretcher has more than 6000 employees in their outlets. Poundstretcher aims to provide quality products and services by selling highquality products and services and now they want to expand their business in the international market. Poundstretcher becomes a trusted retail brand in the UK. It has a huge customer base, and its target customers are of all ages people like children find their toys teenage fine their pets’ product and adult find their household products (Iris and Lam, 2019).

2.0 Strategic Management Process of Poundstretcher

In the Strategic management process Poundstretcher use different framework to analyze the market. In external market scanning, they use Porter’s five forces model and in the internal analysis, they use Mckinsey 7s Framework the company scans their business environment in this way (Rugman and Verbeke. 2018). In Poundstretcher’s external analysis, they discuss the threat of new entrants, substitutes, buyers’ power, suppliers’ power, and the existing competition. Poundstretcher first assesses the situation and then clarifies the object. After that, they set a corporate strategy then implement the strategy then monitor it and review the situation. (Gielens and Dekimpe, 2007).

2.1 Company’s goals, Vision, and Mission

Poundstretcher’s goalis to be a retail brand for all ages people and it will be a symbol of trust a quality.

Mission Statement: Poundstretcher struggle to provide quality product and create a good deal forcustomers.

Vision Statement: Poundstretcher will be the number one retail brand in the world and not only focus on profit but also on quality products and services.

2.2 Environmental Analysis

2.2.1 External Analysis

Porter’s fiveforce analysisof Poundstretcher

To decide for Poundstretcher external analysis is important so the company access their external environment through Porter’s five force model and find the information about the external environment that will need in decisionmaking and evaluation of the company’s performance.

Buyer power

Buyers’ power in the UK market is very high because there have huge numbers of retail brands and fine similar types, so buyers have the power to choosefrom the different retail stores that also had several variations of similar products.(Huang and Sternquist, 2017).

Supplier power

In the UK market suppliers’ power are not high but some of the productsare supplied by single suppliers and sometimes they show their power because their product has a high demand on the market (Moore et al., 2010).

The threatof substitutes

There has a huge threat of substitute products because similar productsare made by different companiesand the product price is sometimes lower so there has a huge threat of substitute products (Davenport et al., 2017).

The threat of new entry

Every year there is several newcompanies come into the market and they invest a huge amount of money,which is always a threat to Poundstretcher (Dawson and Mukoyama, 2013).

Industry rivalry

The growth of the industry sometimes provides some benefits but most of it hasa negative impact like increasing the market competition and the market being small for a specific company (Gielens and Dekimpe, 2011).

Porter’s Diamond Model of Poundstretcher

This model also uses for external scanning of Poundstretcher, and it provides a concept about the firm structure in the market then related to supporting industry, factor condition and demand conditionsof the current market. It provides a scenario of present market conditions and an analysis of this they took decisions.

1. Factor conditions: It is the components and features of Poundstretcher companies that make up Poundstretcher’s competitive advantage. Poundstretcher has access to these natural resources both in Poundstretcher’s native country and in the nations where Poundstretcher has established business and manufacturing facilities.Examples of these include Poundstretchers available cash resources. These are accessible to Poundstretcher through both loan and equity capital resources. The performance and skill levels of Poundstretchers human resources are included in this.
2. Related and supporting industries:The related supporting industry provide support for the industry for Poundstretcher related supporting industry like furniture making industry kitchenwaremaking industry and the household materialsproduction industry help to supply their necessary products and the related products which sell at their outlet, but they do not produce this is the related supporting industry for the company.
3. Strategy, structure, and rivalry: Determining whether Poundstretcher will expand internationally depends on organizational leadership and structure.The goal of Poundstretchers marketing strategy is to give customers highquality goods that are consistently consistent in taste and quality. For the same aim, they train their employees and set a structureto provide products and services within a short time and set a strategy to capture the market.
4. Demand conditions: Poundstretcher’s market has been crucial when taking internationalization and expansion steps. Poundstretchers sophisticated and picky domestic customers have forced Poundstretcherto put Poundstretcher’s resources toward innovation and have inspired Poundstretcher to create special. The demand for their product is high in the domestic market but in the international market,they need to create value for their brand to increase their demand.

2.2.2 Internal analysis

Mckinsey 7s Framework of Poundstretcher

This model is very effective to calculate the internal market of Poundstretcher following this they find information about the company’s structure information about the current system then the styles of the company then information aboutthe organization’s staff finally the skills and strategies of the organization.

Strategy

Poundstretcher has a very defined strategy, which Poundstretcher define and communicates to allits stakeholders and workers. Poundstretchers strategic direction is crucial for directing the behaviour of Poundstretcher stakeholders, employees, and staff in the direction of achieving its objectives.

Structure

Poundstretcher follows the structure where the corporation works as a chain with their outlets all employees connect and there has a management unit to maintain all of the situations and also an HRM department to require the employees and the organization also has a research and development team to improve their services

Systems

There has a unique QR code to find any products and their price. This company introduce automation in billing systems.Also, online delivery service providesautomated product packaging and use online contactless transaction. They introduce an attractive website and mobile apps to placeorders online and it makesit easy for the customers also pick up services the customers place ordersonline, but they collect the product from the outlets.

Style 

They use a participatory leadership style where all the employees can give their opinion and give the management take decision according to theirsuggestions. Employees of Poundstretcher always feel they are part of the organization because they can provide their opinion in every decisionmaking process.

Staff

Staff are highly skilled in Poundstretcher because they provide training and another facility to create their skills. Poundstretcher’s highly skilled employees always provide a good impression for the company. Their staff are well trained to handle difficult situations and provide corrective action in the organization.

Skills

Poundstretcher has a dedicated and skilled workforce who can provide quality services to customersandhas the effective skill to maintain automatic billing and payment systems. They are highly manageable to provide an instant solution when an error occurred.A skilled workforce is the main key to doing business the company collect skilled employees in specific sectors.

3.0 Evaluate the global strategies ofPoundstretcher

3.1 Business Strategy

Poundstretcherhas a significant impact on the retail market in the Uk now they want to focuson growing markets all over the world.

Porter’s competitive strategies to analyze for Poundstretcher’s international business:

1. Cost Leadership Strategy: By executing this strategyPoundstretcher hope to reduce costs while keeping the lowest prices on the market while producing goods and services that are on par with those of Poundstretcher’s competitors in terms of quality.Poundstretcherreduces costs while maintaining competitive pricing to boost profitability. Poundstretcherdecreases costs and keeps a reasonable profit per transaction while raising market share.
2. Differentiation Strategy: Poundstretcherdifferentiation willbea goal that can be reached in several ways and willbe determined by how an organization reacts to market changes, customer expectations, and technological improvements.
3. Focus Strategy: Focus strategies direct Poundstretchers competitive efforts at a small number of more specific, welldefined market segments. Smaller companies like Poundstretcher that might not have the means to undertake a differentiation or cost leadership plan at scale are the best candidates for focus strategies.

3.2 Corporate strategy

Rising customers in AsiaPacific regions are becoming more demanding, especially for ease and convenience. Business chains like convenience stores and supermarkets provide options for quick, accessible shopping experiences (Adams et al., 2016). Poundstretcher is using a digital system to support the frontline operations, such as automation, accounting, stock calculations, and cashier system. In addition, digital solutions will make the operational processes smoother and more manageable, allowing for quality improvement. Poundstretcher will be an example of a digital solution for retail businesses. This management tool will offer supporting features for retail companies, like standardizing displays, tracking issues in realtime, and providing SOP checklists (Das et al., 2019).

3.2.1 Integration Strategy

Poundstretcher’s influence in other areas, businesses can use integration tactics to boost their competitiveness, efficiency, or market share. Poundstretcher’s retail sectors include those related to supply, distribution, and competition.

Vertical integration

Reduced manufacturing costs are a goal for Poundstretcher a retail store company. Poundstretcher purchases the factory that makesfor its retail shop through backward integration. By starting its chain of retail locationsPoundstretchermay also employ forward integration and reach its clients more directly. To convey its goods, it may also employ forward integration to buy a fleet of vehicles, potentially cutting transportation expenses.

Horizontal integration

PoundstretcheraUKretail brand, is looking to expand into a new market using horizontal integration. It acquires some retail shops in Europe and Asia markets. The company can merge with another retail brand in the UK and work with great effort and create a monopolistic market.

3.2.2 Strategic Alliance

By establishing the Poundstretcher centre for health with a Healthcare company, Poundstretcher and Healthcare have launched a new strategic partnership to hasten the adoption of linked healthcare. For many more people to have access to healthcare when and when they need it, this virtual centre will combine Healthcare driven, smart, and accessible care and connected health is essential.

3.3 Global strategy

Poundstretcherknows a thing or two about retail business management tips, and they’re here to help them take their organization to the international stage. They havePorter’s Global Strategyfor Poundstretcher global retail business that covers structural changes they can use to maintain their brand identity, then get into the finer details of what to do once in a new country (Afonina and Chalupský, 2012).

3.3.1 Bartlett & Ghoshal Matrix 

1. Global: Poundstretcher’s global strategy will be employed when there willbe substantial economies of scale and commonalities in market demand. They expand their market in the United Arab Emirates.
2. International: Poundstretcher’s markets are similar and global integration offers few benefits, so an international strategy will use. As a result, Poundstretcher will conduct business internationally yet is mostly managed domestically. Poundstretcher will be made their main in their origin country (Petrou, 2019).
3. Transnational: Poundstretcherwill use transnational when there is pressure to meet local requirements and advantages from global integration. Each subsidiary of Poundstretcher will give responsibility that is commensurate to its skills, with the organization being viewed as a network(Friedli et al., 2014).
4. Multidomestic: Poundstretcher will use Multidomesticwhen there are wide variances in market demands and minimal advantages to global integration. The product of retail businessesis not possible to export for this reason they need to focus onthe multidomesticmodel (Griffin and Pustay, 2015).

4.0 Entry Strategies in International Markets

4.1 Licensing

Licensing is the most appropriate entry strategy for the Poundstretcher because a retail brand store when they provide a license to the local companygains profit throughlicensing they export their products and then sell them at the outlets. The licensee most case the local company in this case the main company do not need to invest more but they gain profit to sell their products. When Poundstretcher provide the license to a local foreign company and the company established outlets in the foreign market and then Poundstretcher can export their product and sell their product through other organizations.

4.2 Joint Venture

Poundstretcher will work as a joint venture to expandits market internationally(Wheelen et al., 2019). Acquisition and merger are one of the international market entry strategies of Poundstretcher. Poundstretcher works as a joint venture with a domestic company to work as a joint venture the local market knowledgegainedthrough the local company for the Poundstretcher canexpand their business internationally, but they need less effort.

 5.0 Recommended Strategies in International Markets

1. Corporate Governance:Poundstretcher will conform to ISO standards for its fundamental corporate governance. The framework for best practice management systems is provided by these standards. A mechanism to manage numerous ISO standards is provided by Poundstretchers software solutions and automation. When Poundstretcher invests in a regular internal audit program, it not only aids in the identification of problems and weaknesses but also offers a chance to evaluate corporate governance.
2. Social ResponsibilityThe retail company Poundstretcher needs to seek social responsibility in a few different ways. They first promised to work toward meeting their energy demands using green energy likewind turbines. Second, Poundstretcher contributed to charitable initiatives to bring clean water to regions of the world where it is scarce.Poundstretcher will concentrate on making its extensive supply chain more socially and environmentally conscious by progressively switching its packaging from plastic to banana leaf.

Conclusion

To reachthe internationalmarket,a company should make an effective strategic management process thatdiscusses their global strategy, and international markets entry strategy to increase competitiveness in the international market in the context ofPoundstretcher this report discussed all their procedure and how Poundstretcher could enter the international market effectively and efficiently.Emphasizingthe Innovation strategywill be the most effective strategy to create their core competencies.The cost reduction strategy is also very effective because people want a quality product at a lower price range. By following this procedure Poundstretcher will launch their business internationally and become an international retail brand. Poundstretcher will conform to ISO standards and a regular internal audit program and is also environmentally conscious by progressively switching its packaging from plastic to banana leaf.

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