Business Strategy Analysis Report: John Lewis Ltd Case Study

This report provides a comprehensive analysis of John Lewis Ltd.'s business strategy. It begins with an introduction to business strategy and the chosen organization. The report then delves into a PESTEL analysis to evaluate the macro-environmental factors impacting John Lewis. Following this, a SWOT analysis and VRIO model are applied to assess the company's internal environment and capabilities. The report further examines the competitive forces within John Lewis's market sector using Porter’s Five Forces model. Finally, the report interprets and devises strategic planning for the organization based on the analyses conducted, offering insights into the company's strengths, weaknesses, opportunities, and threats, as well as its competitive positioning and strategic options. The conclusion summarizes the key findings, and references are provided to support the analysis.

Business
Strategy

Table of Content
INTRODUCTION........................................................................................................3
TASK 1.......................................................................................................................3
P1 Applying appropriate frameworks analyse the impact and influence of the macro
environment on a given organisation and its strategies...............................................................3
TASK 2.......................................................................................................................5
P2 Analyse the internal environment and capabilities of a given organisation using appropriate
frameworks...................................................................................................................................5
TASK 3.......................................................................................................................8
P3 Applying Porter’s Five Forces model evaluate the competitive forces of a given market
sector for an organisation.............................................................................................................8
TASK 4.....................................................................................................................10
P4 Applying a range of theories, concepts and models, interpret and devise strategic planning
for a given organisation..............................................................................................................10
CONCLUSION..........................................................................................................11
REFRENCES............................................................................................................13

INTRODUCTION
Business strategy is refers to a process or technique that help an organization to develop
plans and strategies of appropriate as well as higher level in order to achieve goal and objectives
in effective manner. Through appropriate business strategies a company is able to attain various
advantages which help in achieving goal and objectives such as competitive advancement,
expansion of business operation, enhancement in financial status and customer base and so on
(Alsudiri, Al-Karaghouli and Eldabi, 2013). Organization which is selected for this assignment is
John Lewis Ltd. That is established by John Spedan Lewis in year 1929. They are mainly
operating their business in retail industry and it is headquartered in Oxford Street, London,
United Kingdom. They offer variety of product and services such as clothing, watches, jewellery,
giftware, furniture, foods, cosmetics, beddings and many more. Respective report includes topics
like evaluation and analysis of marketplace in respect of micro and macro environment factors.
Along with this it will include strategic plans which are used for evaluating environment.
TASK 1
P1 Applying appropriate frameworks analyse the impact and influence of the macro environment
on a given organisation and its strategies
For conducting and running business in effective manner a company should analyze its
external factors which are affecting the respective company. John Lewis Ltd conducts PESTEL
analysis for evaluating and analyzing its macro environment factors. Explanation of PESTEL of
which in context of John Lewis Ltd. is given below-
 Political: Many companies decide to enter in the United Kingdom market part of
Europian Union. The market barrier in Europe is very less which makes it easy for the
companies to enter into it, which seems as competitors for John Lewis Ltd. Due to this
the UK government takes a decision to reduce the corporation tax from 30% to 28%
which will help the companies in enhancing their profitability in the future (PESTEL
Analysis of John Lewis, 2019). Also the companies will be able to conduct their business
operations and functions in effective and appropriate manner. But according to the
requirements the rules and regulations of the government changes which mean John
Lewis Ltd. may also have to develop new strategies accordingly.

 Economical: The economy of United Kingdom is dealing with recession due to which
sensitive situation occur for changing interest rates. In order to deal with these situations
the companies of retail sectors should offer their products and services at low prices. This
situation also influences the business of John Lewis Ltd., they also have to offer their
products at low prices and provide discounts also. Respective company very easily
attracts more customers with their pricing strategy but for other company managers it is
very difficult to change their strategies accordingly.
 Technological: John Lewis Ltd. offers internet shopping in order to minimize the
wastage of paper and attract customers for shopping any time and at any place. The
company also use advance technology in order to manage their administrations and
operations effectively and efficiently (PESTEL Analysis of John Lewi, 2019). Adoption
of new technology makes the work easy and effective but at the same time it may be
costly for the companies which affect their budget and other activities.
 Environmental: Many retail companies are taking initiatives to make the environment
clean. John Lewis Ltd. adopts new technologies and strategies for reducing their carbon
footprints also they use recyclable papers and energy to reduce pollution. By this the
company is able to attract more customers by developing such products which are more
skin friendly and environment friendly but at the same time more money has to be
invested adopting these techniques.
 Legal: While operating in retail sector John Lewis Ltd. has to ensure all the legalization
related to the health and safety of the customers as well as employees. They should use
renewable resources for manufacturing clothes (Chang 2016). Along with this they
should also take care of their employees by ensuring their safety and proper equipments.
By adopting the legal factors effectively John Lewis Ltd. can run its business effectively
and efficiently but the regular changes in these factors affect the decision making of the
manager.

TASK 2
P2 Analyse the internal environment and capabilities of a given organisation using appropriate
frameworks
John Lewis Ltd conduct SWOT analysis and VRIO analysis for analysing its internal
environmental, through with them able to identify its capabilities in proper as well as effective
SWOT Analysis:-
Strength Weakness
 The respective company have very
strong brand image that encourage and
attract peoples for buying products.
 They also have very strong presence
through online which offer trendy and
attractive design to customers.
 Management of John Lewis Ltd focuses
on maintaining and developing
effective employee’s relations. Through
which they able to motivate as well as
retain employees for long run (John
Lewis SWOT Analysi, 2019).
 John Lewis Ltd attract their customer
by offering designer and trending
products in affordable to their potential
customers.
 John Lewis Ltd is facing issues in
expanding business in international
market.
 Along with this they are also lacking in
developing appropriate marketing
strategies.
 They are also lacking behind in context
of competitive advancement at local,
national and international marketplace.
Opportunities Threats
 By effective and appropriate strategies
respective company can expand their
business in international marketplace.
 John Lewis Ltd can also develop new,
innovative and unique selling strategies
for attracting more and more customers.
 Regulations and rules which are
developing by government affect
business operation of John Lewis Ltd
(Bharadwaj and et. al., 2013).
 One of the major threats for respective
company is their competitor such as

 They can also introduce new ranges of
products.
 The respective company also enhance
their business by creating private labels
in effective and appropriate manner.
ASDA, TESCO Plc, Marks and
Spencer, ZARA and many more.
 John Lewis Ltd also has fear of failure
i.e. if they expand in new or diverse
culture market they may face failure.
By conducting SWOT analysis respective company understand their strength, opportunities,
weakness and threats. Now they conduct VRIO model in order to analysis their capabilities to
expand business.
VRIO Model: - This particular model is adopted by a company in order to indentify and
analysis its capabilities (Chang, 2016). By this they can develop and indentify many things such
as create appropriate vision and mission statements and objectives, do analysis of internal and
external factors and many more. Explanation of VRIO model in context of John Lewis Ltd is
given below:-
Factors Valuable Rarity Imitable Organized What is the
result?
Global
presence
Global
presence
- - - Competitive
disadvantage
Products Products Products - - Partially
competitive
Software Software Software Software - Temporary
competitive
advantage
Employees Employees Employees Employees Employees Competitive
advantage
Valuable: It refers to those elements of John Lewis Ltd which are valuable for them and those
help in attaining goal and objectives.

 Global presence- It is valuable because through this respective company earns various
things such as effective brand image, profitability, loyal customers and many more.
 Products- Reason behind valuable of this element is that, by this company able to attract
more and more customers in effective manner.
 Software- It is valuable because by this respective company able to secure as well as
manage their data in effective and appropriate manner.
 Employees- These are most valuable for John Lewis Ltd because by this they able to
attain each and every goal in effective manner.
Rarity: It refers to those factors which are rare and by which John Lewis Ltd gain competitive
advancement in effective manner (Eaton and Kilby, 2015). Here global presence is not rare
because there are various competitive companies present at marketplace.
 Products- Products are rare for respective company because it is different from other
company in respect of quality and design.
 Software- It is rare because it is developed by respective company according to their need
and requirement which is different of every company.
 Employees- This factor is rare because every employees of John Lewis Ltd have their
unique and innovative skills and knowledge which company in attaining goal.
Imitable- It includes those factors which are not copied or imitate by another company in order
to gain advantage (Iacob, Quartel and Jonkers, 2012). In respect of respective company products
are imitable by other company to gain competitive advantage.
 Software- Software of respective company is not imitable because it is based on their
need which is very hard to copy.
 Employees- Employees of John Lewis Ltd are very effective and skilled which is not
possible for anyone to copy.
Organized- It refers to those factors of respective company which need very little organization
and by which they attain goal and objectives. Software of John Lewis is not organized factor
because it needs to be organized on timely basis.
 Employees- Employees of respective company on need to be organized on regular basis.
They are very skilled and knowledgeable. John Lewis Ltd also provides training to
employees when they adopt new strategies.

TASK 3
P3 Applying Porter’s Five Forces model evaluate the competitive forces of a given market sector
for an organisation
Porter’s five force model is a technique or methods which are adopted by an organization for
conduct evaluation and analysis of intensity of competition at a marketplace. Through which
leaders and managers of a company is able to design and decide strategies, plans and policies in
proper manner (Jocovic and et. al., 2014). Along with this an organization also increases its
profitability ratio as well as customers base in effective and efficient manner. This process
mainly include factors like operations, structures, work conducted, products and services and
many others. Management of John Lewis adopt Porter’s five force model in order to conduct
market evaluation in effective and efficient manner, explanation of that is mentioned below:-
 Threat of new entry: - It is considers as a situation in which any new company enter
into particular market easily. It is also possible when that specific market is highly
profitable and there is very less barriers as well as legislations. Due to this various
company want established their business in particular market in particular marketplace or
industry. In respect of John Lewis Ltd, threat of new entry is low. It could be so because
it not easy for new enterprises to establish their business same like John Lewis in less
duration of time (John Lewis -- the five competitive force, 2019). According to analysis of
marketplace of United Kingdom respective company is considers under top 10 retail
companies.
 Threats of substitute: - It is a condition when the competitive company offers the same
product and services at same quality but at lower price. In this case, there is huge chance
that the buyer will switch to other options who are offering same quality of product at
lower price. Here, buyer is the king of the market as they get more substitutes of a
particular product and services. In John Lewis Ltd. case threat of substitute is lesser as
there is no close substitute company that can offer same quality product at lower price.
 Bargaining Power of Customer: - The bargaining power of customer is a condition
where customer can ask for product and services but at more bargained price. When there
are various substitutes in the market then only customer get this chance to bargain the
price (Lawton, 2017). Provided, it can affect the production of an organisation when it

manufacture the product at the standard quality level but sale it at lower than the standard
price the profit margin get influenced. Similarly when it manufacture the product at lower
quality for maintaining the lower selling price then it affects the customer's expectation as
the quality of product is now degraded. In case of John Lewis Ltd. there is huge chance
of getting bargained as there are various companies who are offering same quality of
product and services at more affordable price. For this purpose the company must
develop an effective strategy for production which can attract customer.
 Bargaining power of supplier: - It is a situation when there are less number of suppliers
in the market of a particular product and services. In this supplier can ask more prices for
a standard quality of product that can directly affect the cost of production of a company.
Here, supplier's power of bargaining is high as there is fewer amounts of suppliers. In
context of John Lewis Ltd. power of bargaining is very low because there is little number
of suppliers for supplying a standard quality of product. Due to this management of a
company maintains a healthy relation with their respective supplier.
 Competitative Rivalry: - It is refers to the situation where various companies offers
same product at lower price than the competitive company's price for getting large
amount of market share (Li and Tan, 2013). But an intense rivalry may limit the profit
earning of the company as it totally depends on the price cutting moves. For this purpose
various company adopt the strategic plan and do their strength and weakness analysis.
For John Lewis Ltd. there is huge chance of getting competing as there are numerous
competitors in the market offering same quality of product and services to the customer.
Few examples are ASDA, TESCO Plc, McGrath etc.
Therefore, it is must for the company to have an effective plan and develop strategy for the
respective factors stated above that will help company in long run.
TASK 4
P4 Applying a range of theories, concepts and models, interpret and devise strategic planning for
a given organisation
John Lewis Ltd management conduct Ansoff Matrix through which they able to analysis and
evaluate market in order to develop plans, strategies and policies in effective and efficient
manner. Explanation of this in context of respective company is below:-

Ansoff Matrix- It refers to techniques or procedure which is adopted by an organization in
order to develop as well as create plans, strategies and policies which help them in expand their
business in appropriate and effective manner (McGrath, 2013). This can be generally used by
executives, senior manager, marketers and many more who basically strategies plans for their
staffs so that they will conduct their work in effective and appropriate manner. In context of John
Lewis Ltd, their manager uses respective method so that they conduct market evaluation to
identify opportunities in order to develop strategies in effective and appropriate manner.
Explanation of this is given below:-
 Diversification: According to this strategy an organization introduce new range of
products and services at a new marketplace. So that they able to enhance their customers
base in effective as well as in efficient manner. In context of John Lewis Ltd enlarge their
products range in new market they able to boost its brand profitability and goodwill at a
marketplace. Thus for achieving this they have to conduct various function such as
identifying potential customers and market, adopt appropriate advertising techniques and
many more.
 Market development: According to this method an organization plan to expand their
business at new market with the help of new segment. Through which they able to target
more and more customers in proper and efficient manner from diverse sections (Murthy,
2012). In context of respective company, they will introduce new product segment in new
market. Such as they can offer their same existing products at new market, which they are
offering to another market. By this they able to enlarge their customer base of exiting
product, along with this they must also offer new range of products with this.
 Product development: It refers to technique according to which an organization develop
new unique products range for existing market so that they able to attract and retain
customers on large basis and for long time. In respect of John Lewis Ltd, they will
develop innovative and unique range of products for existing market for which they can
enlarge their customer base in large ratio. Through this customer also get encourage to
visit stores on regular basis for checking out new ranges of products, by this company
also able to increase their footfall.
 Market penetration: It refers to a technique which is adopted by a company when they
want to sustain or expanding their business at existing market by offering existing

product (Oestreicher and Zalmanson, 2013). In respect on John Lewis Ltd, fro enlarging
its business of existing product at existing marketplace they will adopt various techniques
in order to attract more and more customers. Such as they will enhance their promotional
techniques, offer discounts and attractive offers and many more. Through which they able
to convince and cover large ratio of potential customers. By which they able to increase
their profitability ratio as well as market shares in effective and efficient manner.
After determining and evaluating all factors of Ansoff method manager of John Lewis
Ltd identify that product develop is most appropriate and effective for them. For which they
will introduce new range of products and services such as now they are only dealing in
western clothing. So they can introduce more range of products such as traditional through
which they able to attract more and more customers of existing market. This will also help
respective company in increasing their profitability ratio and market shares.
CONCLUSION
From the above discussed point it can be conclude and analysis that business strategies is
essential for each and every organization in order to conduct operations as well as functions in
effective and appropriate manner. If an organization wants to conduct analysis of internal factors
that are affecting business they can use SWOT analysis as well as VRIO analysis. Moreover for
conducting analysis of macro environmental factor company may conduct PESTEL analysis.
After completing evaluation of micro and macro environment factors an organization must
conduct evaluation of competition in a market by conduction Porters five forces model. Along
with this for developing appropriate strategies, plans and policies a company may conduct
porter’s generic model. Through all these, management of a company able to develop as well as
create strategies through which company able to conduct operation function in effective and
efficient manner.

REFRENCES
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PESTEL Analysis of John Lewis. 2019. [Online]. Available
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