All Footwear: Competitive Strategy and Performance Report

This report provides a reflective analysis of the All Footwear Company simulation, examining its competitive strategy within the global footwear industry. It delves into the company's approach, combining cost leadership and differentiation, and assesses the industry landscape through PESTLE and Five Forces analyses. The report covers the company's overview, mission, vision, and key decisions made during the simulation, including the beginning, mid-game, and endgame phases. It evaluates the final results, overall performance, and underlying strategic principles, highlighting key learning points about strategy. The analysis includes an examination of strengths and weaknesses, providing insights into the company's position in the market and its ability to compete with major players in the industry. The report concludes with a comprehensive overview of the company's performance and strategic choices.

All Footwear
Simulation Report

Table of Contents
Introduction......................................................................................................................................3
Competitive Strategy.......................................................................................................................3
Industry Overview...........................................................................................................................4
Macro environment analysis- PESTLE analysis..........................................................................4
Five forces model.........................................................................................................................6
Company overview..........................................................................................................................8
Mission.......................................................................................................................................10
Vision.........................................................................................................................................10
Decision made...............................................................................................................................10
1. The beginning.....................................................................................................................10
2. Mid game............................................................................................................................11
3. Endgame.............................................................................................................................12
Final results....................................................................................................................................13
Overall performance of the company.....................................................................................13
Reflection.......................................................................................................................................13
Underlying strategic principles......................................................................................................13
Key learning point about strategy..................................................................................................14
Conclusion.....................................................................................................................................15
Reference.......................................................................................................................................17

Introduction
In this present paper, we will discuss the reflective report of the All Footwear Company. The
paper describes the competitive strategy, industry overview, company overview, decision
making, final results, reflection, underlying strategic principles, key learning point of the
strategy, and conclusion. The paper mainly describes the reflective report of the company All
footwear which is a footwear Company. The company operates in four regions, namely, North
America market, Europe Africa market, and Asia pacific market and Latin America market. In
each region, there are three market segments, namely internet segment, wholesale segment and
private label segment. The competition of the companies is based on the ten factors, namely,
advertisement, the number of models, price, quality, celebrity endorsements, delivery time, and
mail in rebates, retailer support, and shipping charges. The target of the annual performance of
the company is EPS 20%, ROE 20%, stock price 20%, credit rating 20% and image rating 20%.
Competitive Strategy
The combination of cost leadership and differentiation is used by the company which enables to
stand out among the competitors within the same industry. The cost leadership strategy is the
business strategy which enables to reduce the operations cost of the company that maximizes the
revenue of the company within the particular period of time. The aim of the strategy is to exploit
the scale of production and enables to produce high quality of products and services for the target
audience by using the innovation technology within the specific period of time. It helps to
achieve the market leadership through reducing the operational cost of the company. The
continued use of cost leadership strategy help to improve the customer service which enables to

provide a competitive advantage to the company and it also helps to build brand image in the
eyes of the company (D. Banker et al., 2014). The differentiation strategy is used by the
company which helps to produce innovative and unique products and services for the target
audience within the particular period of time. It helps to develop the goodwill and brand
awareness among the target audience within the same industry. The combination of
differentiation and cost leadership strategy helps to provide the low operations costs with the
production of unique products and services that help to provide the competitive advantage to the
company within the particular period of time. The company requires innovation and use of
advanced technology in order to build the competitive advantage to the company. The company
is using a combination of both the strategies in order to provide innovative products and services.
It enables to attract a large number of the new target audience with the retention of existence
customer. The differentiation strategy helps to maximize the strength of the company which
helps to create brand awareness within the particular period of time (Brenes et al., 2014).
Industry Overview
The company lies in the footwear industry, and it operates globally, so the competition of the
company is with the international players within the particular period of time. According to the
researchers, the growth of the global industry will increase in the future, and the market
opportunities will also increase within the particular period of time. It shows that the company
has various opportunities to grow in the existing market

Macro environment analysis- PESTLE analysis
The PESTLE analysis is used to analyze the external environment of the company which enables
to determine the threat and opportunities of the company. Following is the PESTLE analysis of
the company:
1. Political factors
The political environment of the company is stable which enables which to provide the
opportunities to the company within the particular period of time. The company has free
trade policies which provide various opportunities to grow its business. The company is
operating according to the government regulation and policies which help to improve the
infrastructure of the company. The company produces athletic products and services
which always subject to change the manufacturing and taxation laws.
2. Economic factors
The company is contributing towards the economic growth of the company. The rapid
growth of the development markets enables to provide the business opportunities to the
company. The company operates in four regions, and it enables to provide the economic
development of the countries which are fewer development countries (Makos et al., 2015).
The company also provides employment in the operating countries as the revenue of the
company is based on the low-cost labor of the developing countries.
3. Socio-cultural factors
The company has increased the awareness of health consciousness among the individuals
as the target audience feels happy by using the athletic shoes from the company. The
company has also initiated various health awareness programs in order to aware the

individual regarding the health which directly impacts on the sales of products and
services within the particular period of time.
4. Technical factors
The company is using innovative technologies in order to develop unique products and
services to the target audiencewithin the specific period of time. The use of innovative
technologies helps to provide the competitive advantage to the company which enables to
stand out among the competitors within the same industry. The company is using
valuable information based matrix which enables to maximize the revenue of the
company through optimizing the target and production of the company.
5. Environmental factors
The company is using eco-friendly production process in order to produce products and
services (Abbott et al., 2015). The environmental factors are considered by the company
due to which various measures have been taken by the company such as banning of poly
bags, use of eco-friendly material and others.
6. Legal factors
The company has all the rules and regulations of the countries in which they operate.
There are various laws such as employment law, taxation law, consumer law, and health
and safety regulations. It shows that the legal environment of the company is satisfactory.
Five forces model
The five forces model helps to determine the five forces which shape the strategies of the
company through forcing the business. The Michael porter has developed the five forces model
which enables to understand the impact of external threat on the business. Following is the five
forces analysis of the company:

1. Bargaining power of buyers
The bargaining power of the consumers is high as the sales of the company are depend
upon the acceptance of the products and service by the target audience. The preference of
the consumers can be a change which forces them to move from one brand to another.
The large portion of the sale comes from the direct channel to the consumer, so the
consumers have high bargaining power.
2. Bargaining power of suppliers
The bargaining power of suppliers is limited as the company is operating in four regions
due to the company is not dependent on the suppliers. The switching costs from one
supplier to another are high due to which the company supplies their products and
services from different suppliers in order to reduce the force of suppliers on the company
(Zhao et al., 2016).
3. Competitive rivalry
The global footwear industry has intense high competition globally as there are major
competitors who are producing the same products and services in the global market. The
global athletic products change continuously according to the consumer preference, so
the company needs to change continuously in order to compete with the global
competitors within the same industry. The competition is continuously rising within the
industry within the industry due to which the company needs to improve in order to
provide a competitive advantage to the company. So the competitor’s rivalry force is
high.
4. Threat of new entrants

The threat of new entrants is low as a huge capital investment is required to enter the
global market due to which very less new entrants try to enter into the global market. The
company enjoys brand recognition in the global market which does not impact from the
entry of new competitors in the market. The new entrants require a huge amount of
marketing in order to develop the brand image in the eyes of the consumers due to which
a large number of entrants are not trying to enter the market.
5. Threat of substitutes
The threats of substitutes are high as the athletic products are highly demanded in the
market, and there are various competitors who are providing similar products and
services which impact on the sales volume of the company. So the company needs to
continuously improve the products and services in order to sustain in the competitive
market (Ortega et al., 2014). The innovation of products and services helps to reduce the
threat of substitutes on the company as the differentiation of products and services helps
to attract a large number of the target audience which directly impacts on the sales
volume of the company.
Company overview
The company provides athletics shoes in all variety the men's, women's and children's. It
operates globally, and the target audience of the company is covering people from all groups as
the company is providing products and services to the all age group of people. The company
operates in four regions, namely, North America market, Europe Africa market, and Asia pacific
market and Latin America market. The company is using the combination of cost leadership and

differentiation strategy which helps to stand out among the competitors within the same industry.
The company stands as the strong competitors within the same industry globally as the company
is providing the high quality of products and services to the target audience globally. There are
large numbers of competitors who are providing similar products and services to the target
audience globally. Following are the strength and weakness of the company:
Strength
The strength of the company helps to provide the competitor’s advantage to the company which
helps to maximize the profitability of the company within the specific period of time. Following
are the strength of the company:
1. High quality of products
The company provides the high quality of products and services to the target audience
which enables to develop the competitive advantage that helps to maximize the
profitability of the company within the specific period of time (Bull et al., 2016).
2. Use of innovative technology
The company is using innovative technology in manufacturing the products and services
which enable to stand out among the competitors within the same industry.
3. Brand recognition
The company has good brand recognition among the target audience globally which
enables to attract new consumers, and it enables to generate high sales volume of the
company.
Weakness

The weakness of the company restricts the company to maximize the profit generation of the
company within the specific period of time. Following are the weakness of the company:
1. The company does not have its own retailers, and the retailers are very price sensitive.
However, the high income is generated from the retailers. It impacts on the profit margin
of the company which is one of the major weakness of the company.
2. The company is mainly depending upon the share of the footwear industry which is
vulnerable, so it is the major weakness of the company.
Mission
The mission of "All Footwear" is to dedicate diverse quality shoes to customers while leading the
way for sustainable business.
Vision
The vision of "All footwear" is to become the industry leader and create a new landmark for
footwear industry.
Decision made
The decision making is one the most important aspect of the company which enables to achieve
the mission and vision of the company within the specific period of time. Following are the three
stages in which various decisions are taken for the long-term profitability of the company.
1. The beginning
 Financing of company operations

The company decides to finance its operations from the combination of personal funds
and debt taken from the debtors of the company. The combination of debts and equity is
used for the operations of the company because it helps to delineate the risk (Levin et al.,
2013). The results of the decision hope to provide the adequate funds for the smooth
operations of the company.
 Production of branded and private label footwear
The company decides to produce private label footwear as it helps to develop the brand
image in the eyes of the customers. The results from the decision hope to develop the
brand recognition which enables to provide the competitive advantage to the company.
 Corporate social responsibility
The company decides health awareness program globally which directly impact on the
sales volume of the athletic footwear. The results from the decision hope to provide the
create awareness among the people which helps to provide benefits to the target audience.
 Forecasting of sales forecasting & inventory management
The sales forecasting decision is taken on the basis of historical performance of the
company. The forecasting decisions help to manage the total expenditure of the company
according to the forecasting sales within the particular period of time. It is taken to
manage the total inventory of the company.
2. Mid game
 Plant capacity additions
The plant capacity decision is taken on the basis of forecasting demand of the company.
The results of additional plant capacity decision of the company are to increase the sales
volume of the company.

 Worker compensation and training
The decision regarding the worker compensation and training is to increase the human
resource capabilities of the company in order to maximize the sale volume within the
specific time framework. The results expected from the training decision are to improve
the human resource capabilities in order to provide the competitive advantage to the
company.
3. Endgame
 Pricing and marketing
The decision of pricing and marketing is taken based on the competitor’s price offering,
the cost of production and other factors which are used in developing the products and
services.
 Celebrity endorsement contracts
The decision of celebrity endorsement contract decision is taken on the personality of
celebrity matching with the products and services which helps to promote the products
and services in the eyes of the customers (Anderson et al., 2015). The results expected
from the decision are to increase the sales volume of the company and popularize the
brand image in the eyes of the target audience.
 Shipping and warehouse operations
The decision of warehouse operations is taken on the basis operating capacity of the
company. The results expected from the decision are to maximize the sales volume of the
company within the specific time framework.

The expectation of the investors is to maximize the profitability of the company in order
to provide higher returns. The net profits of the company have been increased in the four
years which shows that the expectations are met by the company. The credit rating of the
shares is A+ which shows that the expectations of the company. The overall performance
of the company is the fifth position in the industry. As the best in industry score is 69 and
the overall score of the company 92. The performance of the company is relative
satisfactory as compare to the competitors within the same industry.
Final results
Overall performance of the company
The company operates in three segments, namely, internet segment, wholesale segment, and
private label segment. The overall performance of the company in internet segment is 69, and the
market share of the company is decreased from the year 2017 to 2018 by 1.5% which shows that
the company has a relatively low market share among the competitors. In the wholesale segment,
the overall performance of the company is low, as the market share of the company is decreased
from the year 2017 to 2018 by 6.3%. In the private label segment, the company has highest bid
price which is 35 among the competitors.
Following is the annual performance of the company analysis:
1. EPS: The expected EPS of the company is 20% and the actual performance is
tremendously increasing from the year 2011 to 2016 but in the year 2017 the company
underperforms and in the year 2018 the EPS is 6.62 which shows the overall performance
is satisfactory.

2. ROE: The expected return on equity is 20% which is higher than the expected in the year
2011, 2012 and 2013 but from the year 2014 to 2018 the company is not able to meet the
expected ratio which shows the returns has been reduced.
3. Stock price: The expected stock price is 20% and the overall stock prices from the 2011
to 2018 the company is able to meet the expected performance of the company.
4. Credit rating: The credit rating of the company from the year 2011 to 2018 is A+ which
shows the stock has outperformed.
5. Image rating: The expected image rating is 20 and the actual performance of the
company is higher than the expected performance from the year 2011 to 2018.
From the above analysis it can be states that the overall performance of the company is
able to meet the expectations of investors.
Reflection
I performed well as all the factors of the successful business are considered in the report. There
are various lessons which are learned from the business game in order to succeed in the business.
Underlying strategic principles
The strategic principles derive the strategy of the company and it is the action oriented which
helps to act quickly as it provides guidance to the company in order to achieve the mission and
vision of the company. It enables to determine the strategic action to be taken by the company in
order to manage the strategies of the company in an effective manner (Morden et al., 2016).
The strategic vision of the company is to produce a unique style of footwear with the best quality
at an affordable price in order to provide a competitive advantage to the company.

The companies are managing its strategies in a most efficient and effective manner which is
shown from the market share and profitability of the company. The strategic thinking of the
company considers all the factors which impact on the sales volume of the company. The
operating profit of the company provides a competitive advantage due to which the market share
of the company is highest among the competitors of the company within the same industry. The
overall operating profit of the company is profitable which shows that the operations of the
company and strategies are very effective (Shapiro et al., 2013).
Key learning point about strategy
 The assessment of macro environment helps to determine the opportunity and threats
which enable to manage the risk and expand its profitability within the particular period
of time.
 It is important to examine the industry and the competitors in order to develop the
competitive advantage which helps to stand out among the competitors within the same
industry.
 There are various complexities of running the business such as managing the operations
of the company, risk management, cost controlling and others.
 The focused of the company is necessary which helps to achieve the mission and vision
of the company within the specific period of time.
 The strategic analysis enables to examine the strategies of the company which enables to
provide the competitive advantage to the company (Zott et al., 2013).
 There are six stakeholders of the company, namely, customer, investor, employee,
environment, communities, and team members.

Conclusion
It can be concluded that the All footwear company has satisfactory performance. The
competitive strategy of the company has a combination of differentiation and cost leadership
strategy which helps to produce unique products and services with the reduction in operational
costs. The PESTLE analysis of the company shows that the political environment of the
company is stable; the company is contributing towards the economic environment of the
company. The technical environment of the company is satisfactory as the company is using
innovative technologies to develop the innovative products and services. The five forces model
shows that the bargaining power of buyer is higher, bargaining power of supplier is low, the
competitor's rivalry is high, and the threat of new entrants is low and the threat of substitutes is
high. The overview of the company shows that the overall performance of the company is
satisfactory as the company is using effective strategy with clear mission and vision of the
company. The decision making of the company is one of the most important aspects which helps
to achieve the goals and objectives of the company. The beginning decision includes financing of
company operations, production of branded and private label footwear and corporate social
responsibility. The mid game includes plant capacity additions and worker compensation and
training. The end game decisions include pricing and marketing, celebrity endorsement contracts
and shipping and warehouse operations. The final results show that the overall performance of
the company is satisfactory as the market share of the company is higher among the competitors
within the same industry. The strategic vision of the company is effective as the operating profit
of the company is continuously growing which shows the operations are managed in an effective
manner.

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