Strategic Analysis of American Eagle Outfitters | Report

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Strategic analysis of American Eagle Outfitters

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Contents
Introduction......................................................................................................................................2
Vision, Mission, goals, and objectives............................................................................................2
Macro-environment.........................................................................................................................3
Porter’s five forces...........................................................................................................................5
Capability analysis...........................................................................................................................7
Proposed strategy...........................................................................................................................10
Strategy evaluation........................................................................................................................12
Conclusion.....................................................................................................................................12
Reference.......................................................................................................................................13

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Introduction
Strategic management and analysis in an organization are essential for formulating,
implementing and evaluating the strategic decisions for achieving the goals and objectives. This
report includes the strategic analysis of the chosen company American Eagle outfitters with the
help of various tools. The internal and external business environment of the organization is
analyzed for identifies the issues and problems which are faced for strategic management. This
report includes the strategic analysis which is done with the help of evaluating the vision,
mission, goals, and objectives. The analysis of macro-environmental includes the PESTEL for
analyzing the business environment. The analysis of the industry is conducted with the help of
Porter’s five forces and value chain analysis is done for the analysis of capability. In order to
evaluate the strategic options, the generic strategies are adopted and the proposed strategy is
evaluated by using the suitability, acceptability, and feasibility.
American Eagle Outfitters profile
American eagle outfitters, inc is a retailer of American lifestyle clothing and accessories. It is a
public company and its headquarter is in Pittsburgh, Pennsylvania which is founded in 1977 by
Jerry and Mark Silverman. The number of locations that are served by American Eagle Outfitters
is 934 across the world and the number of employees is more than 45,000 (American Eagle
Outfitters, 2018). It operates in the clothing, designing, marketing and selling the own-brand
accessories and clothing. The line of products is not limited but includes denim wear, sweaters,
knits, personal care, and accessories. These are sold under the name of AEO and aerie brand
names which include the retail stores of AEO brand, aerie retail stores and AEO direct.
Vision, Mission, goals, and objectives
The vision statement includes the statement for the desired future which the company wants to
be in the future. It plays a crucial role in aspirations and motivating and stretches the
performances. The vision statement is to build trust, honesty, and integrity. We strive: to
determine, create and work hard. They ensure that everyone should be the best version of
themselves. The value of the organization includes people, innovation, passion, integrity, and
teamwork. The mission statement of the organization is to invest in and give back to the
communities which contribute to their success (American Eagle Outfitters, 2018).

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Macro-environment
The macro-environment includes the framework of analyzing the broad environmental factors
which impact on the survival. It is considered as a strategic tool for analyzing the macro
environment. It includes the political, economic, social, technological, environmental and legal.
These factors directly impact on the macro environment of the American eagle outfitters. Any
change in the factors impact on the business in the market. It impacts on the competitive
advantages and on the profits level of the retailing sector (Bettis, et al., 2014).
Political factors
Political factors impacts on the profitability and survival chances. As American Eagle outfitters
required to consider the long term profitability because it operates apparel stores which require to
diversify the systematic risks. In the market, it is necessary for the organization to consider
political stability as it is important in the clothing sector for the economy of the country. The
level of corruption is required to consider in the market for following the regulations in the sector
of services. The legal framework is required to be considered for the enforcement of the contract.
In the service sector, tariffs and trade regulations are required to be considered. Pricing
regulations are included in the political factor and providing the industrial safety regulations for
the employees. In apparel stores, it is necessary to consider the product labeling and taxation of
the country (Boehghe and Cruz, 2010).
Economic factors
The economic factors include the interest rates, savings and inflation, foreign exchange and cycle
of the economy which are required to be considered for the demand and investment. These
factors are required to be considered for competitive advantages. American eagle outfitters
consider the economic system for operations of the business. The efficiency of the market is
required to be considered and the quality of infrastructure. In apparel stores, the skill level of the
workforce is required to be considered. In the economy, it is necessary for the organization to
consider the productivity level (Dobbs, 2014).
Social factor