VRIO Analysis of Yull Shoes

Strategic Management Project
Five Forces analysis
Yull shoes produces designer shoes for women. Designer footwear industry is a highly
competitive industry. Five forces analysis of British designer footware industry is provided
below:
Bargaining power of suppliers
Supplier's power to control prices of product in relation to designer footwear industry is
moderate. This is because there are large number of inputs to produce designer footwear for
ladies. The factor which raises buyer power to moderate is use of exotic skin and need for
highly skilled labour which increases dependency of the company on their employees and
exotic skin provider.
Bargaining power of consumer
In case of luxury footwear industry bargaining power of consumer is high. This is because
designer footwear brands focus on select few consumers and have to collaborate with
distribution partners to sell their products on a global scale. This increases bargaining power of
buyers.
Threat of substitute products
The threat of substitute products in case of designer footwear industry is low as consumer buy
product for brand name rather than personality. However there is threat from counterfeit
products which act as a cheap substitute of designer footwear.
Threat of new entrants
This element of the five forces analysis is low in case of designer footwear industry. High
investment level, time taken to create brand image and high competition are several entry
barrier which reduce this element.
Competitive rivalry
The intensity of competition in designer footwear industry is high. MiuMiu, Prada, Christian
Louboutin, Jimmy Choo and Ferragamo are some of the well known designer shoe brands
increase competition.
VRIO
This analysis helps determine core competencies of an organisation. VRIO analysis
of Yull shoes is provided below:
V R I O
Financial
resources
YES - - -
Promotional
campaign
YES YES - -
Brand Image YES YES YES
Human
resources
YES YES YES YES
Valuable: The brand image, promotional campaign, financial resources and human resources of the company
are valuable to Yull shoes. The promotional campaign of the company which highlights the sustainability of
their products and British nature help the company gain success in their domestic region. The brand image of
the company is structured around Britian as each product of the company is named after a British landmark.
This is a unique brand identity which is absence from various international organisations. The Human resources
which construct elegant footwear for the firm are highly valuable and reason behind their sucess.
Rare: The brand image, promotional campaign and human resources are rare competencies of Yull shoes. This
is because creating a brand image is time taking, promotional campaign based around Britian cannot give
similar results on adoption and it is difficult to find skills shoe craftsman in current labour market.
Imitable: The brand image of the company cannot be easily imitated as it involves association with UK while it
is difficult to gain highly skilled workforce which has ability to design shoes.
Organised: The brand image of the company is an organised competency of Yull shoes. The main reason
behind this is that the company is able to create an authentic image related to British culture and use it in their
shoe design, promotional campaign and products to attract consumers.
Part 1: Situational and Organisational assessment