Strategic Management Report: JD Sports PLC Japan Market Entry

This report provides a strategic analysis of JD Sports PLC, a UK-based retailer specializing in sports and casual wear, with a focus on its potential expansion into the Japanese market. The analysis begins with an executive summary and introduction, followed by an external analysis using PESTEL and Porter's Five Forces frameworks to assess the political, economic, social, technological, environmental, and legal factors influencing the market, as well as the competitive landscape. An internal analysis utilizes the VRIO framework to evaluate the company's resources and capabilities. The report then identifies potential competitive strategies, including an application of Bowman's strategic clock to determine optimal positioning. Finally, it offers strategic directions, recommendations, and a conclusion, providing a comprehensive overview of JD Sports PLC's strategic considerations for successful market entry and growth in Japan, addressing challenges such as economic conditions and currency exchange rates.

Strategic Management

Executive summary:
Strategic administration is the procedure which involve various activity like planning,
controlling, assessing that help in achieving goal in timely manner. There are various changes
taken place in external atmosphere that analyse regularly adopting competitive strategy that is
needed for success of organisation. This assignment is depending upon JD sports PLC which is
located in UK. It is a retailing brand who focuses on dealing with sports as well as casual wear.
The higher authority of this brand focuses on expanding their business in Japan market for
satisfying need and wants of customer at both national and international level that help in
achieving competitive edge over rivalries at marketplace.

Table of Contents
Executive summary:.........................................................................................................................2
INTRODUCTION...........................................................................................................................4
External analysis..............................................................................................................................4
Internal analysis...............................................................................................................................7
Identification of competitive strategies............................................................................................8
Strategic directions:.......................................................................................................................11
Recommendations & conclusion...................................................................................................12
CONCLUSION..............................................................................................................................13
REFERENCES .............................................................................................................................14

INTRODUCTION
Strategic administration is the procedure which involve various activity like planning,
controlling, assessing that help in achieving goal in timely manner. There are various changes
taken place in external atmosphere that analyse regularly adopting competitive strategy that is
needed for success of organisation. This assignment is depending upon JD sports PLC which is
located in UK. It is a retailing brand who focuses on dealing with sports as well as casual wear.
The higher authority of this brand focuses on expanding their business in Japan market for
satisfying need and wants of customer at both national and international level that help in
achieving competitive edge over rivalries at marketplace. There are various challenges
confronted by JD retailer that involve negative economic situation and increasing rate of
exchange that decrease profit margin. In addition to this, there is assessment of micro and macro
environment for aim of assessing prevailed opportunity in given target market (Balotsky
Stagliano and Haub, 2016).
External analysis
PESTEL
Political factors:
The Japan government is offering different incentive to company for influencing
restructuring of machinery which is above 20 years of age group to increase competitiveness
related to footwear sector. And also their focuses are on promoting or make uses of method of
modern production. In context of JD sports PLC, there is a service to increase competitiveness of
industry that is connected to sportswear as government focuses on offering support of tax facility
in addition with other kind of incentive which involves process of licensing related to investment
in various industrial zones, different kind of capital food, minimise interest rate and introduce
formula for fixed wage rate.
Economic factor herein, the demand or need for sportswear in Japan market that was
looked by foreign as well as local sportswear manufacturer is increased day by day. Sports
involve football, basketball, cycling that is determined as a popular. With enhancing the middle
class user in country, sports play an important role in Japanese economy. It has generated a need
for sportswear goods that help in increasing growth of 15% in upcoming year. The footwear
sector provide job to approx 3.5 million individual people around Japan which is determined as a

15% of total applicants of manufacturing sector. They focus on offering opportunity in order to
expand market share in Japan. They increase more and more revenue in order to satisfy need of
middle-class user during particular phase of time period. This increases their profit by 140
million upcoming years of 2030 (BANI and Bagheri, 2019).
Social factor is determined as element which is connected to change in need and wants
of user. Japan focuses on providing products according to choices and lifestyle of user. The
young person’s that is in age of 28 year help Japan to be determined as a attractive market for
manufacturer of sportswear. It is offering opportunities related to expanding market during
particular phase of time period.
Technological factor with outbreak related to corona virus in various part of world that
emphasized on organisation to expand themselves for E-commerce platform. In context of JD
sports PLC, they focus on using both online as well as offline channel for capturing larger
market share. The Japanese E-commerce association focuses on forecasting E-Commerce
transaction which is around 8 billion USD in year of 2014 into 25 USD in 2016. In context of JD
sports PLC, they focus on expanding their business in Asian market for grabbing opportunity to
reach youth audience in order to provide them product according to their need and wants.
Environmental factors there are various environmental factors which are considered by
JD sports PLC in order to conduct their activities in an appropriate manner. They provide
protection to environment in Japan market in order to attract large number of user and build
brand image and reputation of company in front of customer in Marketplace.
Legal factor There are various legal elements which is determined as a part of legal
framework in innovative country. They focus on determining that factor in order to expand
business by considering difficult procedure of licensing. There is a requirement to follow all
guidelines that involve special importer identification number, import identification number and
many more. So it is determined as an element that results in higher regulation or hurdle for
company named as JD sports PLC (Huang, Gardner and Moayer, 2016).
Five forces framework
Porter five force models is considered as a strategic administration tool which is adopted
for making analysis related to industry and then improvement strategy for executing them for
particular business organisation. For aim of maintaining detailed analysis of these forces, there is
a requirement to make a proper evaluation that is going to be mentioned below:

Threat of new entrants new entrance result in innovation as there is an improvement of
innovative way for performing work. There is a focus on adoption of strategy related to low
pricing that lead in decreasing price and innovative value proposition for target audience. Herein,
there is a low level of threat of new entrants as JD sports focuses on establishing their brand
image in existing location which aids assistance in expanding their business in innovative market
by reducing external profit that leads in respect of discouraging innovative player.
Bargaining power of suppliers for company in a specific industry are buying raw material
from different supplier. Therefore, supplier plays an important position that can reduce profit
margin. Powerful supplier focuses on providing services to its user in order to satisfy their need.
JD sports PLC focuses on getting power related to supplier by diversifying supplier list and
getting rights from different supplier for supply raw material. And, also they conduct effective
research related to innovative product (Shiu and Yang, 2017).
Threat of substitution the innovative goods and services are capable to meet need and want
of user then it results in threat of substitute for particular brand. In context of JD sports PLC,
they focus on expanding their business in Asian market and handle threat of substitute. There is
also a requirement of understanding need and want of consumer in order to increase brand image
or reputation of company in front of customer at marketplace (Ike, 2017).
Industrial rivalry it is the competitive rivalry which is prevailed among existing competitor
of Japan. The whole industrial rivalry is determined as a high for JD sports PLC in basic stage
because there is a different kind of brand which already exists such as Nike, Adidas which deal
in sportswear. Therefore, it is necessary for JD sports PLC to provide product according to need
of customer in order to increase profit margin in future period of time.
Internal analysis
VRIO ANALYSIS OF JD SPORTS IN INDONESIA
This is determined as framework that is adopted to achieve competitive edge as it is used
in achieving competitive advantage over rivalries at marketplace. This framework signifies four
components that are valuable, rare, inimitable as well as organised.
Valuable it is determined as a value that is provided to user by company named as JD
sports PLC. They provide superior quality of goods in addition with trustworthy supplier and
possess superior brand value that helps in building trust of user during particular phase of time
period. In context of Japan, there is a wide range of customer who are interested in wearing

sportswear and organisation focuses on making appropriate research in addition with different
outlet in various countries that make capable to manage market and need with appropriate
standard process. JD sports focuses on market their goods at relatively less price which provide
value to its user and generate satisfaction to its user during the period of time.
Rare They possess superior supply chain administration that generates higher value in
order to distribute goods in various geographical regions along with superior effect. The
capability regarding strong chain administration, JD sports PLC focuses on making efforts in
order to achieve competitive edge over rivalries at marketplace. They possess faithful or trust for
supplier which helps them in making appropriate availability of good which is determined as a
best method to retain or sustain user by offering goods regularly to deal with superior supply.
Inimitable it is determined as a capability to possess different kind of quality an
organisation is not capable to imitate the resources during particular phase of time period.
Therefore, they possess trustworthy supplier and superior supply chain in addition with having
skill on knowledge regarding market generate inimitable factors that can be expensive in
addition with time consuming. The focus is on taking benefit of opening new outlets in Japan
that can assists in satisfying customer during particular phase of time ((Evans, 2019).
Organised this is determined as a capability to handle resources and different
administration system in proper way that can assist in getting superior management tool within
organisation. To achieve competitive edge, there is a requirement to adopt administration in such
a manner that helps recruiting superior employee in order to perform work in an appropriate
manner. JD Sports PLC hire HR staff that assists in organising administration in an appropriate
manner in Japan to enhance share of market in which will be beneficial for company to take
decision.
Resources or
capabilities
Value Rare Inimitable Organised Result
Product
quality
YES NO NO YES Low
competitive
advantage
Faithful
suppliers
YES YES YES YES Strong
competitive

advantage.
Strong supply
chain
management
YES YES NO YES Moderate
competitive
advantage
Customer
satisfaction
YES YES YES NO Moderate
competitive
advantages
Identification of competitive strategies
Bowman's clock
It is determined as a model in which there is different option available for tactical
position and goods must be positioned that helps in achieving competitive edge over rivalries at
marketplace (Johns, 2016). In addition to this, the primary purpose of using Bowman’s clock is
to illustrate method in which organisation can make assessment related to different variety or
wide range of options that are capable to position their goods that is depend upon dimension that
perceived value as well as prices. There are different stages that are determined as a part of
Bowman clock and analyse it for using most appropriate option for expanding market during
particular phase of time period. In current scenario, it is necessary to expand market of brand of
JD sports PLC that help in targeting market in Japan. Therefore, the Bowman’s clock adopted by
JD sports PLC that is going to be mentioned below:

(Source: Bowman's Strategic Clock (Strategic Positioning), 2018)
Position 1: low price and low value added herein, the good is not determined as a unique
and the user perceived low value as well as low price. In this method, for achieving competitive
edge, the chosen organisation focuses on undercutting cost but this strategy is not determined as
a suitable in reference of expanding organisation innovative market of Japan.
Position 2: Low position Herein, the organisation focuses on positioning themselves as this
strategy focuses on minimization of price in order to increase output and decrease profit margin
during particular phase of time period (KHASHEI, HEIDARI and POURABBASI, 2017).
Position 3: Hybrid it is determined as a position that include different element related to
profit margin is determined as low and output is considered as high. Hybrid position include
different element of low cost but there is also an availability of product differentiation. The
primary purpose is to satisfy its user by combination of reasonable price as well as product
differentiation. In context of JD sports PLC, this strategy is adopted if the value is provided in
regular manner.
Position 4: Differentiation the primary purpose of this strategy is to provide high worth to
its user so that they focus is on perceiving high-value. Branding is very important for this
strategy as a company's focuses on using brand name for increasing awareness of brand in front

of customer in marketplace. Most of the strategy is adopted by JD sports PLC help in increasing
brand image or reputation in existing market.
Position 5: Focused differentiation herein, the primary purpose of this strategy is
positioning goods at higher cost where user focuses on buying product because of high worth.
Herein, the focus is on adopting strategy by using luxurious brands and their focus is on targeting
large number of user during the period of time. In context of JD sports PLC, this is the strategy
and tactics help in increasing profit margin and sustaining them for a longer period of time.
Position 6: Risky high margin it is considered as a risky position related to brand as
organisation focuses on setting high process but there is not any kind of additional offering in
context of perceived worth. If user buys goods at higher price in only that case the profit margin
will determine as a higher. In context of JD sports PLC, they adopt price skimming strategy in
order to take entrance in market and it also helps in satisfying need and want of customers during
particular phase of time period (Kim, 2018).
Position 7: Monopoly pricing in reference of monopoly pricing, there is specifically one
branded at marketplace that is providing specific kind of goods. There is not any kind of possible
position in context of JD sports PLC in current scenario where the focus is on expanding their
business in innovative market which is determined as a Japanese market in which there is already
existence of some competitive rivalry firms.
Position 8: Loss of market share herein, there is a condition of disaster for market of
competition. There is a requirement to set standard price or cost for goods in addition with low
perceived worth. In context of JD Sports PLC, this strategy is helpful in perceived higher value
by targeting its user in Asian market to market of country named as Japan.
On the basis of above given analysis, it has been assess that there are three position for
organisation as per Bowman strategy clock. Herein, the position related to 6, 7 as well as 8 are
not determined as a competitive. It is only adopted when cost are determined as a higher than
perceived worth. The market focuses on operating their business in order achieve competitive
position. It is necessary to have a presence of providing larger perceived value along with similar
prices or value will determined as a similar but cost is low.
In reference of JD Sports PLC, there is a need for sportswear goods in Japanese market that
is look by international as well as local producer. The low cost goods dominate market related to
China. There is a requirement to emphasize on sportswear goods that help in expanding their

organisation during particular phase of time period. There is a proper strategy as per changing
condition of sports sector in China. Focus differentiation where the brand is successfully
implemented in order to differentiate their quality of goods to its user so that the user can't switch
their product easily to other brand. The chosen organisation focuses on providing products and
services according to need of its user during particular phase of time period (Köhler and
Hoffmann, 2017).
Strategic directions:
It signifies different plan that is made by administration of business organisation to make
appropriate progress in respect of goal and as well as objective of company in timely manner.
The strategic direction which is provided to JD sports PLC that is going to be mentioned below:
Ansoff Matrix this Matrix was founded by H. Ansoff in the year of 1957. There are
different strategy adopted administration of organisation that aids assistance in having a clear
image regarding goods and services of organisation at Marketplace. In addition to this, there are
different kind of strategies such as product development, market development, diversification as
well as market penetration and many more.
Market penetration this is determined as a strategy in which business organisation increase
sales in order to provide goods and services at marketplace. There is different promotional
method and also organised research at market to use trending tools and techniques and to assess
present demand of user at marketplace. It increases loyalty of customer in respect of brand of
organisation by giving different offer or discount on goods.
Product development this strategy aids assistance to organisation to introduce goods and
services in prevailed market in addition with their competitive firm. There are different type of
method in which organisation focuses on bringing modification in their existing product and
marketing them at comparatively less price for attracting large number of user. This strategy
offer different promotional tools to promote product of organisation that help in enhancing
presence in market (M’zungu, Merrilees and Miller, 2017).
Market development strategy assists business organisation to take entrance in innovative
market with its existing goods and services. Expanding various marketplace include dealing with
innovative segment of user, geographical region as well as so on. It helps organisation to assess
need of customer at Marketplace and also provide contribution to increase sales of company.

Diversification this tactic assists organisation to capture innovative market in order to
satisfy need and want of its customer. They offer different kind of opportunity for business
organisation to enhance profit margin and income and achieve a dominant position at
marketplace.
In context of JD sports PLC, on the basis of above given strategy, the administration of
organisation focuses on using different strategy related to product improvement. It will helpful in
conducting different activities as well as functions in an appropriate manner.
Expansion method
In context of operation, product, capital, the business organisation focuses on expanding.
The expansion of organisation signifies expanding operations of organisations in order to control
specific location. There are different kinds of expansion ways that is adopted by business
organisation. In context of JD sports PLC, the licensing obtained by business organisation that is
given below:
Licensing
Licensing it is a determined as a basic expansion way that is adopted by organisation. It
signifies official proof which is taken by organisation to offer them satisfaction according
different activity of organisation. JD sports PLC adopts different licences in respect of goods
which is distributed at marketplace that provide freedom to organisation to explore various
segment related to business atmosphere. Licence is determined as a valid proof for executing
different kind of activity of organisation and brings transparency in working of organisation that
assist in maintaining interest of user in respect of brand of organisation (Norman, P.M., 2018).
Recommendations & conclusion
On the basis of above given necessary evaluation, there are various recommendations which
can be adopted by JD sports PLC that is given below:
The JD sports PLC emphasized on gym, clothing as well as other product of sportswear for
handling some innovative launches to expand their business in new market that is Japan. JD
sports PLC focuses on adopting European distribution centre in the year of 2020 with enough
capacity to introduce innovative product for their brand of footwear. It is determined as a proper
strategy to expand their market to target innovative market.
The Japanese sportswear sector faces different kind of challenges in order to achieve
competitive edge over rivalries at marketplace. There are various challenges or having a difficult

licensing procedure that increases cost of company. There is a requirement that footwear and
different industry have performed their business as per priority sector of JD sports in order to
target new market and that help in dealing with all kind of challenges.
The JD Sports PLC focuses on dealing with other rival firm in condition of economic
downturn by emphasis on increasing sales related to replica footwear kit. It can be recommended
that brand must adopt appropriate segmentation of market in order to achieve competitive
advantage over rivalries at marketplace.
CONCLUSION
On given report, it is assess that strategic administration is the procedure which involve
various activity like planning, controlling, assessing that help in achieving goal in timely manner.
There are various changes taken place in external atmosphere that analyse regularly adopting
competitive strategy that is needed for success of organisation. There are various challenges
confronted by JD retailer that involve negative economic situation and increasing rate of
exchange that decrease profit margin. In addition to this, there is assessment of micro and macro
environment for aim of assessing prevailed opportunity in given target market.

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