Strategic Management Report: JD Sports Market Expansion Analysis

This report provides a comprehensive strategic management analysis of JD Sports' market expansion, focusing on the challenges and opportunities associated with entering new markets. It begins with an executive summary and introduction, followed by an in-depth examination of the external environment using PESTEL analysis to identify political, economic, social, technological, environmental, and legal factors. Porter's Five Forces framework is applied to assess competitive pressures. The internal environment is analyzed through SWOT, VRIO, and value chain analyses to identify JD Sports' strengths, weaknesses, resources, and core activities. The report identifies competitive advantages, draws conclusions, and offers recommendations for successful market expansion. The analysis uses various tools to assess pricing, competitive pressures, and other strategies to support JD Sports' growth. References are provided to support the findings.

Strategic
Management

Table of Contents
Executive summery..........................................................................................................................3
INTRODUCTION...........................................................................................................................4
MAIN BODY ..................................................................................................................................4
External environment analysis for identifying opportunities and threats....................................4
Internals and analysis to identify strength and weakness............................................................7
Identification of competitive Strength.......................................................................................10
Concision and Recommendation ..................................................................................................13
REFERENCES..............................................................................................................................14

Executive summery
this report has coved study of JD Sports on the basis of their market expansion. This
report has conduct both internal and external analysis and use various tools like PESTEL,
Porter's Five forces, VRIO, Value chain analysis and Porter's generic strategies etc. to identify
the strategies used by the company like their pricing, competitive pressures and many others
strategies that will helps JD sport in their business expansion.

INTRODUCTION
Strategic management is the ongoing planning, analysis an d assessment of all the
necessities an organization needs to meet their objectives and goals. Changes in the business
environment will need company to improve their strategies to stay within competition.
Company & industry background
JD sport's is an one of the top leading company, selling quality sport's wear and come
under the retail industry. UK retail industry is playing important role to developing UK economy
and there are many companies who are operating their business in all over the world. For
example- TESCO, Mark's and Spencer's and many more (Mahsud, manaka and Prussia., 2018).
JD Sports is also a part of the UK retail industry because it cover's various segment's like
grocery, clothing and many more.
JD Sports was established in year 1983 by the David makin and John Wardle. They are
selling quality sport;'s wear and casual wear within the UK market. They started with the single
shop and n ow they are having 56 shops in across the UK and having good reputation. Till the
end of year 2011 JD Sports expanded their business within most of the European countries like
Spain, Sweden and Denmark etc. This company is mainly known for the most innovative visual
merchandiser of the sportswear with the best and the most expensive stylish range. This
company also open their first flag store in Asian in sun-way Velocity, Charas and now they are
looking to expand their stores in new market Thailand.
Key challenges faced by company
There are some key challenges that affect companies profitability are Brexit, Increase in
prices of raw material, and one biggest challenges that creating huge problem is COVID crises
that crashes the large economies all over the world and UK is on of them. Countries organize
lock-down and there were very few retail stores who get permission from the government to
keep open their stores during the lock down. JD Sports faces the losses due to lock down and
their sales and profitability and growth everting goes down.
MAIN BODY
External environment analysis for identifying opportunities and threats
JD Sports is looking for the expansion of the business within the JD Sports business
there are some external factors that can affect their business and before entering within the new

environment, they need to identify what are the factors can have impact on their strategies and
what change they will need according to the Country where they are expanding their business.
PESTEL Analysis
Political Factors
Political have both negative and positive impact on the JD Sports, Thailand Is one of the
fastest growing and major market for the foreign investors and companies. Their government is
inviting companies to invest within their company (Desai., 2020). A support from the
government related to investment in their country remove the barrier to take entry within the
Thailand market. Negative impact from the political environment from this country can be high
corrosion and political can demand for the money to take entry within the country and JD
Sports have to pay them, so they can take entry effectively.
Economical
Economical environment can be beneficial for the JD Sports if they expand their
business within the Thailand. According to the report of the world bank are that Thailand has
progresses in the short times moving from the lower income to the upper income countries in
year 2019. According to the statistics GDP of the company is growing positively which is an
good sign for the JD Sports. The standard of living life within the country improved and people
are spending more on buying product which mean possibility to increase in sales for the JD
Sports is high. On the other side lower unemployment rates within the country can have negative
impact on the JD Sports because people will demand for the high salary for their work.
Social factors
Their are some social factors within the Thailand that can impact both positive and
negative on the JD Sports. People within the Thailand are hard-working and skills full. Both
male and females workers can work effectively, and they are also have friendly nature that can
easily convince customers to buy product and services from them (Eyhorn and et.al., 2019). JD
Sports can grab this opportunity approach local people to work on their stores and it will also
help them to overcome from the language barrier. On the other side JD Sports can face some
from to sell their sport's wear and casual wear because most of the people wear traditional
clothes but innovation in their product can help to overcome from these problems as well.
Technological factors

Technological factors can have positive impact on the JD Sports because Thailand
government is offering varieties of the incentives according to the screams and new trending
technology within the JD Sports stores can help to create good impression on the customer and it
will help JD Sports to take competitive advantages within the new market, Thailand also an one
of the leading South Asian country who are using the Social media so it will be easy for the JD
Sports to attract customers thorough social media tools.
Environmental
It is necessary for the JD Sports to run eco friendly activities, and they can also give
contribution toward the environmental issues, It will make easy for the JD Sports to take entry
within Thailand. Every country support companies who create good opportunities for their local
and look for the environmental issues and run eco friendly business.
Legal
There are some legal rules related to the employment, investment etc. that should be
followed by the JD Sports, so they can create good terms with the Thai government, and they
will able to run their business effectively (Henriques and Brilha., 2017).
Porter's five force framework -
This model applied on JD Sports company consist of -
Threat of New Entrants – The company sells differentiated products rather than standardized
products. Force related with company power is not being affected by the force of new entrant in
the marketplace for JD sports (Bruijl, 2018). It means that less money and time it will cost for the
JD Sports competitor to enter the market. Thus, it will be a weak force for the company. JD
Sports is already established within the Uk and having good reputation within this market that
makes this force for the company.
Threat of Substitute – Few substitutes available for the products produced in the JD Sports
company implies that there is no ceiling on the maximum profit. If JD Sports company produces
products which are not similar to the other companies then it will ensure the rise in prices along
with growth and development of the company.
Rivalry among Existing Firms – The rivalry with the existing firms on other side with JD
Sports company will be low if there are only limited number of players in the market competing
with each other (Išoraitė, 2018). The economic cost structure in the market affects the company

as the switching cost for consumers is high which leads to difficulty in competing with other
companies.
Bargaining Power of Suppliers - This factor addresses that how easily suppliers of JD Sports
can drive - up with the cost of inputs. Fewer the suppliers to the company more will be the power
of them with growth in the trade advantages of other countries. Enhancement in the supply
process will help improve the products and services of the company.
Bargaining Power of Buyers – The ability of the customers to buy the product which the
company produces depends on the quality of the product. This factor is very important for the
company because the power of customers to purchase the product at low prices helps the
company charge with better sales and profits.
Internals and analysis to identify strength and weakness
Internal analysis like Swot, VRIO and value chain analysis are useful tools for the organizations
to identify their internal strength and weakness (Lanford., 2020). This tool can help company to
covert their weakness into the opportunities, so they will easily take competitive advantages and
take entry within the Thailand market.
Vrio Analysis
valuable
 Financial resources of the JD Sports are valuable and they can use financial resources to
take entry within the Thailand market. International market entry required high er finance
so JD Sports will use their valuable financial resources to take market entry. Sport's wear and Casual; wears sell by the JD Sports are highly valuable because they
do not compromise with their product quality. Production team of the JD Sports look for
the best possible quality in the product, so they can satisfy needs and demand of their
customers.
Rare
 Technology use by the JD Sports to develop their product is find as the rare and there
are very less competitors who use the trending technology, because it cost high and its
not possible for every company to adopt Higher technology like JD Sports. Employees of the JD Sports are rare founded by the Vrio, it is because JD Sports
provide high level and skilful training, and they invest time on their employees makes

them skilful and its very rare that other companies put high effort in their employees
(Liu., 2018).
Imitable
 The financial resources of JD Sports are high-priced to imitate as identified by the JD
Sports VRIO Analysis. These resources have been non inheritable by the company
through prolonged net profit over the years. New entrants and the challengers would need
similar profits for a long period to roll up these amounts of financial resources. The patents of JD Sports are very hard to imitate as identified by the VRIO Analysis of
JD Sports. This is because it is not legally allowed to imitate a patented goods. Similar
resources to be developed and getting a patent for them is also a costly process.
Organisation
 distribution network of the JD Sports is well organized and JD Sports uses their network
to provide their product and services to the customers As soon as possible (Maiorescu.,
and et.al., 2020). Their logistic team always ensure that their product reach at all the
stores and available product when it is needed and it shows that how well they have
organized their resources and how it is helping them to take competitive advantages.
 The financial resources of the JD Sports are well organized, finance manager of the
company have invested their finance on the right places that is helping them to get better
profits, and they also manage and organize their finance in effective way and ensure the
flow of finance within the organization.
Value chain analysis
primary activities
Inbound activities
It is necessary for the JD Sports to develop a strong relationship with their suppliers to
get some additional benefits and it will also help them to store, receive and distribute their
product. Inbound logistic is an strong area for the JD Sports from their raw material to the
finished goods.
Operations
Operational activities within the JD Sports rise when raw material arrive within the
company, where operational team develop and convert raw material into the finished goods .

Before launching their product into the new market (Ng., 2018). Other process like quality f the
product and product testing take place and it also includes packaging, machining and assembling
etc. It includes both manufacturing and delivering the products to the customers.
Outbound Logistic
Outbound logistic includes the activities that delivers the products to the customers by
passing through the various intermediates. Some of the Out can also include warehousing,
handling and order processing etc. Improvement in the Inventory management will be needed to
the JD Sports because they will be needed better inventory management according to to the need
and demand in the Thailand market.
Marketing and sales
JD Sports use various marketing and sales strategies that can be useful;l for them to
expand their business in the Thailand. Social media marketing is one of them. They are using
digital marketing strategies that can also be used for the promotion of the product and services
sell by the JD Sports for the Thailand.
Services
Pre- selling and Post selling services offered by the JD Sports can be useful for selling
product in the new market. Still company will require to improve their services, so they can gain
loyalty of the customers within the new market and take competitive advantages.
Secondary Activities
Firm Infrastructure
The firm Infrastructure covers various activities, such as quality management,
accounting, matter handling, plaining and strategic management (Nizam and et.al., 2019). JD
Sports have a effective infrastructure and this slow this company to optimise the value chain. It is
also helping them to take competitive advantages./
Human resource management '
Human resource management is on of the most important part of the JD Sports who help
to bring talented employees and also run various practices at the workplace of JD Sports to
make employees more effective and productive. HRM will play huge role in the to bring skilful
employees for the company at their new market as well.
Technology Development

JD Sports is using trading technology within their company that help them to take
competitive advantages. In a new market Thailand will need them different and better technology
that can be capable of making changes in the operation according to the needs and demand of the
customers within new market.
Procurement
The procurement in the companies value chain denotes the process that include a
purchasing of the machinery, equipments, raw materials etc. are important and necessary for the
proceeding and selling of the final product to the customers. It is necessary for the JD Sports top
acre fully considers its procurement activities, so they can take competitive advantages, and they
can properly expand their business within the new market and show their presence effectively
within the Territory of Thailand.
Identification of competitive Strength
Porter's 5 Generic strategies
Porter's Generic Strategies are useful strategies that can be used by the JD Sports to take
competitive advantages within the market where they are operating their business and mainly it
leaders and managers of the JD Sports can use it for the Expansion of their business in Thailand
(Nowotny and et.al., 2018). Porter's Generic strategies include Cost leadership, Differentiation,
focus.
Cost leadership strategy
Cost leadership is one of the most effective and useful strategy that help to provide
companies advantages. It can be use in two-way by the JD Sports to be successful within the
new market. Firstly, Increase in the profits by reducing the cost, while changing the industry
average princess. JD Sports Can also enter within the Thailand market with the lower prices for
their product. It will help them to increase their sales and aware customers about their product
and services. Second strategy is increasing the market shares by charging lower prices, while still
making a reasonable profits ion each sales. This is similar strategy but effective where JD Sports
will reduce their prices but not that low.
The Differentiation strategy
Differentiation strategy is also one of the most effective an popular among organizations.
In this strategy company improve their product and create some differences from the other
competitors who are selling the same product. The innovation in the product attract the

customers and JD Sports can make good image in the market. JD Sports can also use this
strategy and develop their product according to the need and demand of the customers in the
Thailand market. Company will require high market research to identify the customers needs so
they can identify how they can modify their product and make more effective as compare to the
other competitors within the Thailand market.
The Focus Strategy
Organizations that use the Focus strategies concentrate on he particular Niche market
and by understanding the market dynamics and the different needs of the customers within the
market . To take successfully entry within the Thailand market JD Sports will need a low cost
and the well specified product improvement that can satisfy the needs and demand of the
customers within the market. With the more focused and Serving the customers within the new
market in unique way will help JD Sports to expand their business within the new target market
effectively. One company have the selected focus strategies then they can easily show their
presence within the Retail industry of the Thailand.
Strategic Direction
Market
JD Sports is looking to expand their business in the Thailand and it is good time for the
JD Sports to expand their business in this market because it is one of the developing country
(Olawumi and Chan., 2018). All the resources that needed to the JD Sports are available with
the good quality so company will not need to import resources from the other counties. Raw
material is available within the lower prices so JD Sports can develop and manufacture product
in affordable prices for the customers, so they will able to satisfy the need and demand of the
customers. Economic growth is rapidly growing and it can be good opportunity, if JD Sports
able to cover most of the shares within this country, and they will able to recognize themselves
and take competitive advantages.
Product
JD Sports will need to develop their product, according to the needs and demand of the
customers within the Thailand market. They will need to conduct market research and collect the
information about the quality demand, satisfaction level and according to the information
collected by the companies marketing and research team, JD Sports production team have to
develop product accordingly. Each and every market have different needs and demand and if

company want success then they have to innovate and develop their product according to the
customers needs and their demand, so they can fulfil market needs and take competitive
advantages.
Services
Customer resource improvement can also help JD Sports to take competitive advantages
within the new market. Fats services and new skills will be needed in the new staff and for that
they will need to provide training and development to their employees, so they can develop new
skills and gain loyalty of the customers.
Methods of Expansion
There are various method of the business expansion like Join venture, Franchising, direct
exporting etc. This methods are used for the expansion of the business in target market. JD
Sports can also use one of the strategy to expand their business.
Franchising
Franchising is the market entry method in which owner of the business who are know as
the Franchisor hand over their business system and process to the individual group or the
individual business who are known as the Franchisee, give rights to run and sell product and
services using their business model and system. Distribution of the profits and investment are
depend on the model they are using because every model have different way of sharing and
distributing business profits and investments (Voituriez and et.al., 2018).
Joint Venture
Joint venture is one of the best strategy that can also be used by JD Sports to expand
their business in the Thailand. In a joint venture business, tow or more than two parties agree to
work together in the same business. They share equal profits and shares and it also depends on
their sharing within the business. It can be beneficial strategy for the JD Sports Because they
will able to take easy market entry and two companies will invest together so financial base of
the companies will be strong and it is less risky strategy.
Direct exporting
Direct exporting means that a producer of the goods and services directly sell or deliver
their products within the target market. They can also take help of the mediator, distributors and
known who are already living within the target market. Mediators find the local suppliers within

the understand and sell them their product directly to them and it is more beneficial as compare
to selling product locally.
Concision and Recommendation
Recommendation
IT is necessary for the JD Sports before entering Thailand market, to research about
market so they can have proper knowledge and the can collect information related to the
customers needs and demand. information about the quality demand, satisfaction level and
according to the information collected by the companies marketing and research team, JD Sports
production team have to develop product accordingly (von Braun., 2018). Each and every market
have different needs and demand and if company want success then they have to innovate and
develop their product according to the customers needs and their demand, so they can fulfil
market needs and take competitive advantages.
Conclusion
As per the report has been covered case study of JD Sports on the basis of their market
expansion. This report has been conduct both internal and external analysis and use various tools
like PESTEL, Porter's Five forces, VRIO, Value chain analysis and Porter's generic strategies
etc. This report has been discuss the Thailand market including the benefits JD Sports can have
and negative impact as well. In the end of this report has been provided methods JD Sports can
use to take market entry and get the final conclusion that Joint venture staategy can be used by
the JD Sports to take market entry.

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