Table of Contents INTRODUCTION...........................................................................................................................3 MAIN BODY...................................................................................................................................3 The trends in retail industry....................................................................................................3 Analysis of Next plc...............................................................................................................4 Recommendations..................................................................................................................7 CONCLUSION................................................................................................................................8 REFERENCES..............................................................................................................................10
INTRODUCTION In this report, the particular industry that has been taken into consideration is Retail industry because it is covering huge area of the market. Basically, Retail industry is considered to be the sector where a business owner effectively start making determinations like how effectively we can cell different range of products and services to the targeted individuals and to givecompetitiontotherivals(Bodolica,SpraggonandSoueid,2019).Retailindustry specifically focuses on meeting the requirements of customers which can be anything from grocery from our clothes and any other type of daily basis products and services that are essential for an individual. The particular organisation that has been taken into considerationisNext plc, which was found by Joseph Hepworth in the year of 1864 and presently this organisation headquartered at England, United Kingdom. MAIN BODY The trends in retail industry In present time, global economy is dealing with outbreak of a disease named as COVID- 19, that has not only impacted negatively on health considerations of public belonging to United Kingdom but it has also affected the economic conditions as well. The major concern is safety and security of individuals and at present the trends within the Retail industry are carrying a rapidly changing nature and this is because of the uncertain alterations within the policy is due to pandemic(Pantano, Priporas, Sorace and Iazzolino, 2017). Considering the environment and while focusing on the proper analysis which has been performed on the market there are a range of trends that are available in the market that will be helping in taking right decisions so that a business likeNext plcmay effectively gain ample number of benefits and some of these trends are presented underneath:Shopping confidently:Due to outbreak of Corona Virus, it has been analysed that individuals are pretty much and this led them to purchase products and services through online channels. But, this also raise the concern in relation with security and safety of personal information because there are many places that came in front of cyber crime where hackers took the information of customers and started threatening them like they will kill them and so on. Therefore, taking decisions in relation with purchasing of different products and services, here it will be required by the retailer to consider and 3
effective security and safety related program that will help shoppers to keep their information secret at the time of shopping.Localism and community:Public transport is something that it was majorly being affectedbyoutbreakofcoronavirusanditisprettymuchneededforbusiness organisationstotakehelpfromlocalgovernmentlikedevelopingandeffective community that supports purchase of products and services with the help of local retailers this will benefit both small retailers and supermarkets as well that are already dealing at national or international level (Martino and et. al., 2017). Brands and products:From last two decades, it has been found that customers has started trading among expensive and branded products or services. However, in terms of trading of consumers specifically purchase cheaper products the initial time in order to fulfil the needs but after that a try expensive products and then take decisions of choosing one particular brand. This is something which is needed for an organisation likeNext plc to understand the delivering quality products or services will automatically help company in sustaining in the market for a longer period of time. Analysis ofNext plc As it has already been mentioned in the introduction section thatNext plcwas found in the year of of 1864 by Joseph Hepworth and at present company has already gained appropriate good well of being a famous supermarket in front of the customers that helps them in fulfilling their requirements and needs in much effective and efficient manner(von Briel, 2018). In all over the world,Next plcis considered to be a famous supermarket brand but just because of COVID-19, their profitability and productivity got affected the most. Analysis of this particular organisation is being done considering two different analysing tools and these are PESTLE framework and Porter’s five forces model, which are discussed underneath: PESTLE Analysis: PESTLEDescription Political/LegalNext plc, which is performing at international level, political elements like Brexit has impacted on business operations in both positive and negative sense. Basically, United Kingdom's market become open, which brought ample number of opportunities for 4
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foreignbusinessorganisationsthatwerelookingforwardto expand their business. This raised many concerns for Next plc because they started facing difficulties in enhancing their profit ratios and productivity and the reason that came in front was continuouslyrisingcompetition(Santoroandet.al.,2019). Including this, if it is talked about the legal aspects then it can be said that outbreak of COVID-19 has also raised various concerns for Next plc, like there was a need of following the lock down guidelines which is given by parliament of United Kingdom. This is where revenue which was generated by Next plc in past few years was affected negatively. EconomicalThis is considered to be one of the crucial factor which majorly impacts on an organisation in both negative and positive manner. In context withNext plc, company is already performing business atinternationallevelwhereanychangeswithintheglobal economy might impact on profitability of this organisation. In present situation of outbreak of COVID-19, it has been found that UnitedKingdom'sgovernmenthasgiventaxrebateto organisations that are dealing among different sectors. This has also helpedNext plc in raising benefits like resolving the issue of paying salaries to the staff members and so on. SocialOvertheyears,ithasbecomevitalfor companiestofocus different social factors as they carry both negative and positive impact on company's performance level(Ying and et. al., 2020). Different needs along with the requirements of staff gets change from time to time and in present situation of global pandemic, public is specifically worried about their health because of rapid spread of COVID-19. This is where, these individuals avoids purchasing products and services from physical stores therefore, it broughtvariouschangeswithinpurchasingbehaviourof 5
consumers. In present context, Next plc would also require to make alterations like they would require to start selling products and services through online channels. Consumers started focusing on online retailers and this is where they also started avoiding public transportwhich they usually used to do in order to visit supermarkets and so on. TechnologicalTechnology is said to be one of the crucial business influencer, which is continuously changing trends from a really very long time. Spread of COVID-19 virus has started bringing various changes like, local retailers within this particular sector started shiftingfromperformingbusinessthroughonlinestoresthan physical ones(Sansone and Colamatteo, 2017). This has helped them in reducing the chances of people getting connected with each other, which can be considered as a reason behind rapid spread of Coronavirus. Next plc is said to be an organisation which is continuously promoting and offering techno-friendly services to the customers, which has helped them in enhancing sustainability in the future market and so on. EnvironmentalAnother crucial element of PESTLE Analysis, which also impacts onanorganisationinbothpositiveandnegativemanner. Basically, due to lock-down people stayed at their home and just because of this pollution got reduced approximately by 60%. This is something, which also impacted positively on utilisation of natural resources as environment healed itself, which has given opportunities for customers to enhance sustainability in much effective and efficient manner. Porter's Five Forces Analysis: Five ForcesDescription Threat of new entrantsWithin retailing sector of United Kingdom, it has been found 6
that threat of new entrance has been really very low and the reason that came in front was that the existing organisations like Big 4 Supermarkets has grabbed a good position in the market. This might reduce the chances of getting these new organisations to become less able to survive in the United Kingdom's competitive business environment Bargaining power of customers Customers' bargaining power within retail industry is also reallyverylow.Awaywiththis,theexplanationinthis situation of effective demand and supply graph also stays unbalancedinnature(Hançerlioğulları,ŞenandAktunç, 2016). Bargaining power of suppliersOvertheyears,bargainingpowerofsuppliershasbeen moderate in context with United Kingdom's retail industry (for Next plc) because own store but due to the pandemic, the factoriesareclosedbecauseoflock-downanddifferent companieshavetodependontheexternalsuppliersfor retailing activities. Threat of substituteThreat from substitute products launched by companies within retail industry is also really very low in nature and the reason that came in front was the unstable economy along with the barriers for the entry is quite wide which not so easy to manage considering the current situation. Existing rivalryNext plc, an international retail organisation carrying a leading position within the market where it was found that position of the company is not that much effective in nature and carrying a saturated position within the market because of rivals like Big 4 Supermarkets and like Tesco, Walmart, Sainsbury's & many more. 7
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Recommendations Considering the above mentioned information, it is being analysed that Next plc is also holding a good position within the market and carrying a stronger brand image in all over United Kingdom. Company is continuously satisfying customers with potential products and services that they are serving with quality (Hançerlioğulları, Şen and Aktunç, 2016). Including this, it is also found that at present Next plc is going through ample number of difficulties like they are not able to achieve their daily targets and because of this less productivity and profitability can be seen. In order to sustain within the market, there are a few recommendations that can be given to company and some of these are given underneath:Compliance with government rules and regulations:This is said to be the primal recommendation that is specifically being given to Next plc that all the political guidelines are required to be followed by them in any chance or in any case. On the other hand, after analysing the overall situation of current pandemic it can be said that it will be needed by organisation to undertake all the rules and regulations. Also, Next plc would require to develop own policy that tends to follow considering guidelines and safety regulations of prominent areas (Balaji and Roy, 2017). Effective use of digital tools and technology:Another recommendation that can be given to Next plc is to take into consideration of digital tools along with the technologies and the reason that came in front was that individuals would tend to ignore the current options of going out from their place and shop. In present context, Next plc can effectively launch an online website platform for the consumers to sustain within the market for a longer period of time. CONCLUSION With the help of above mentioned information, it is summarised that the retail business patternsarevaluablefororganizationregardingwinningincreasinglymorebenefitand accommodating in making due in outside condition. For this, retailers should know about the outer market since economy isn’t steady and furthermore advantageous for the business. Thus, in thinking about the current circumstance, organization likewise will make themselves more versatile towards the progressions and compelling improvement that happens in industry with respecttothebestpossibleworkingandfunctioningaccordingtothenecessitiesand prerequisites of clients. As far as this, patterns tare recognized by demonstrating the correct 8
variances according to the necessities and inclinations of clients as far as changing the buying conduct. Besides, Porter’s fiver forces along with PESTLE are utilized as far as distinguishing different acts of organization and furthermore will in general arrangement with unmistakable changes.Finally,scarcelyanyrecommendationsaregivenlikenoticeableutilizationof innovation, etc. 9
REFERENCES Books and Journals Bodolica, V., Spraggon, M. and Soueid, M.A., 2019. Innovation drivers and trends in the retail industry:anapplicationtoemergingmarketsandthecaseoftheGulf region.International Journal of Comparative Management,2(1), pp.51-66. Pantano, E., Priporas, C.V., Sorace, S. and Iazzolino, G., 2017. Does innovation-orientation lead to retail industry growth? Empirical evidence from patent analysis.Journal of Retailing and Consumer Services,34, pp.88-94. Martino, G., Fera, M., Iannone, R. and Miranda, S., 2017. Supply chain risk assessment in the fashion retailindustry: An analyticnetwork process approach.Int. J. Appl. Eng. Res,12, pp.140-154. von Briel, F., 2018. The future of omnichannel retail: A four-stage Delphi study.Technological Forecasting and Social Change,132, pp.217-229. Santoro, G., Fiano, F., Bertoldi, B. and Ciampi, F., 2019. Big data for business management in the retail industry.Management Decision. Ying, S., Sindakis, S., Aggarwal, S., Chen, C. and Su, J., 2020. Managing big data in the retail industryofSingapore:Examiningtheimpactoncustomersatisfactionand organizational performance.European Management Journal. Sansone, M. and Colamatteo, A., 2017. Trends and dynamics in retail industry: focus on relational proximity.International Business Research,10(2), pp.169-179. Hançerlioğulları, G., Şen, A. and Aktunç, E.A., 2016. Demand uncertainty and inventory turnover performance: An empirical analysis of the US retail industry.International Journal of Physical Distribution and Logistics Management,46(6-7), pp.681-708. Balaji, M.S. and Roy, S.K., 2017. Value co-creation with Internet of things technology in the retail industry.Journal of Marketing Management,33(1-2), pp.7-31. 10