Strategic Management Report: Accent Group Limited Analysis

This report offers a strategic analysis of Accent Group Limited, also known as RCG Corporation Limited, an investment holding company operating in the apparel and footwear sectors in Australia and New Zealand. The report begins with an overview of the company, its brands, and its strategic priorities, which focus on offering opportunities and comfort in the performance and lifestyle sector. It then conducts an industry analysis, focusing on the Athlete's Foot segment using Porter's Five Forces model to assess the competitive landscape. The analysis reveals the low threat of substitute products, high threat of new entrants, intense competition among existing players, and varying supplier and buyer power. The report recommends differentiation and focus strategies, suggesting that Accent Group Limited expand its product line to include formal shoes. The report also discusses financial and non-financial measures, such as increasing market share and customer satisfaction, to evaluate the success of the proposed strategies. The conclusion summarizes the key findings and recommendations, emphasizing the importance of strategic adaptation in the competitive footwear market.

Running head: STRATEGIC MANAGEMENT
Accent Group Limited
Sustainable and Strategic Accounting
8/27/2019

STRATEGIC MANAGEMENT 1
Table of Contents
Introduction................................................................................................................................2
Overview of Accent Group Limited......................................................................................2
Industry analysis.....................................................................................................................3
Porter Five Force Model....................................................................................................3
Porter’s Generic Strategies.....................................................................................................4
Financial and Non-Financial Measures to Evaluate the Success of Strategy........................5
Financial Measures.............................................................................................................5
Non-Financial Measures....................................................................................................6
Conclusion..................................................................................................................................6
References..................................................................................................................................8

STRATEGIC MANAGEMENT 2
Introduction
Strategic Management is said to be on-going planning, nursing, analysis and valuation
of every process that is essential to the business for meeting its objectives and goals. Quick
innovations, developing technologies, and expectations of customer enforce businesses to
think and frame decisions strategically for staying successful. The aim of this report is to
present the strategic priorities of Accent Group Limited by analyzing its business and
industry environment. After the analysis, the report is recommending some of the strategies
that can be adopted by the company to overcome the identified concerns. Further, the report
is also discussing the non-financial and financial measures that the company can use for
evaluating the success of the recommended strategy.
Overview of Accent Group Limited
Accent Group Limited is also known as RCG Corporation Limited which is an
investment holding company. The company holds and run a range of apparel and footwear
business in the active and performance lifestyle sectors. The business of the company is
operated through different segments that are retailing of general sports footwear, Athlete's
Foot, and a franchisor. It is a public company which is placed at 625 ranks out of the top
2000 Australia companies (IBIS World, 2018). It operates its business in Australia and New
Zealand. The brand list of the company is comprised of: Hype DC, Sperry Top-Sider,
Merrell, Athlete’s Foot, Palladium, and Stance, Platypus Shoes, CAT, Dr. Martens, Skechers,
Vans, Saucony, and Timberland (Reuters, 2019). The strategic priority of the company is to
offer opportunities and comfort in the performance and lifestyle sector. The company design
the best quality of shoes for its customers which has supported it be the leading brand of
Australia and New Zealand.

STRATEGIC MANAGEMENT 3
Industry analysis
Accent Group Limited operates majorly in the footwear sector by offering different
high brand products with high quality to satisfy the demand of comfort of customers. In order
to conduct the industry analysis, Athlete's Foot has been selected that is one of the products
of the company.
Porter Five Force Model
Porter Five Force Model is one of the strategic development tools that are used by the
businesses to analyze the competitive forces that impact the performance of the business.
This model is comprised of five forces that represent the complete image of the industry in
which a business operates (Magretta & Porter, 2012).
Threat of Substitute Products – The threat of substitute product in the athletic
footwear is low because there is no or limited substitute of this. The shoe market is comprised
of different players who are involved in offering sportswear and athlete footwear to the
customer and involved in designing their products in a better way. This reflects that in the
footwear market, there is several players but not one offer any type of substitute for athlete
shoes.
Threat of New Entrant – The threat of new entrant in the sports shoes or athlete
shoes market is high due to limited entry barriers in the industry (IBIS World, 2019). The
increasing number of new players in the market is raising challenges for Accent Group
limited in terms of maintaining its profitability and market share.
Competition among Existing Players – The Australian footwear market especially
athlete footwear market is intensely competitive due to presence of several players who
aggressively get involved in the promotion of their products to have increased market share.
In addition to this, the players in the market are bringing new designs and prices for the

STRATEGIC MANAGEMENT 4
customers to beat their competitors. Some of the competitors to Accent Group Limited’s
Athlete's Foot are Charles Clinkard, Rack Room Shoes, Nike, Reebok, etc. (Zoom Info,
2019)
Power of Suppliers – The high power of suppliers in the market results in reducing
the profit margin of business and vice versa. The footwear market is comprised of different
players who offer raw material for the manufacturing or retailing of the products which result
in reducing the bargaining power of the supplier for accent Group's Athlete's Foot.
Power of Buyers – The high bargaining power of customers in the footwear market
results in impacting the business high in terms of revenue and sales. However, low bargaining
power offers the business a chance to charge a high price. The athletic footwear market is
very competitive which allow customers to switch from one brand to another at zero
switching cost (Market Watch, 2018). The low switching cost for the customer in the athletic
shoe market encourages customers to shift to any other sports or athletic footwear brand in
order to avail high quality at low prices.
Porter’s Generic Strategies
Porter's Generic Strategies determine how a business attains a competitive advantage
in its entire market scope. There are three/four strategies under this head that are either focus,
differentiated or lower cost (Mckeown, 2013).
Cost Leadership Strategy – This strategy is comprised of wining the share in the
market by the company by attracting price-sensitive and cost-conscious customers. This can
be attained by having charging low prices from the customers in comparison to other retailers
or businesses present in the market (Scheele, 2014).

STRATEGIC MANAGEMENT 5
Differentiation Strategy – Differentiate the service or product in some manner for
competing successfully is one of the requirements in today’s competitive market (Williams &
Williams, 2017). Examples of the successful use of a differentiation strategy are Nike by
entering in the athletic shoes which have supported it in increasing its customer base.
Considering this, Accent Group Limited must get involved in adopting the differentiation
strategy under which it can expand its operations in the formal shoes for men and women.
Along with offering Athletic footwear, the company can include formal shoes in its product
line. Diversifying the business in this field will support it in increasing its customer base
which will eventually increase its revenue and strength against its competitors.
Focus Strategy – The focus strategy is not considered to be a new strategy for large
businesses because of small market situations. Large businesses that choose to adopt
differentiation strategy can also apply in combination with the focus strategies (Zoephel &
Zapf, 2011). Accent Group Limited is recommended to along with adopting differentiation
strategy it must get involved in adopting focus strategy under which it can drag its focus from
its general shoe market to Athletic Foots and Formal Shoes segment.
Financial and Non-Financial Measures to Evaluate the Success of Strategy
Choosing CSF that is Critical Success Factors – This aspect is comprised of
identifying the factors that can help in measuring the success of the selected strategies such as
financial, customer, learning and innovation, and internal business process (Business
Victoria, 2019).
Financial Measures
Under the financial measure, the business can evaluate the success of the
recommended strategy that is diversification in the formal shoe segment by identifying the
financial viability of the business and the benefits of adopting this strategy.

STRATEGIC MANAGEMENT 6
Increasing Market share and customer base can be a measure that can evaluate the
success of the diversification and focus strategy. The diversification in the different segment
is being planned to increase the market share and customer so it is achieved the business
could consider it a success.
Non-Financial Measures
Customer – Customers are considered to be vital for the success of the business.
Hence, it becomes important to identify the satisfaction level of the customers by identifying
whether or not the business is meeting their needs (Beck, 2011). It addition to this, the
position of the business in the eyes of the customer can support in measuring the success.
Internal Business Processes – Under this measure the business can identify the areas
that need to be improved in the business for delivering services to the customer and other
stakeholders.
Learning and Innovation – Under this area, the business will identify what new and
innovate it is offering in the market that creates value for the customers.
Conclusion
The above report has provided a brief overcome of the market and industry position of
Accent Group Limited which is one of the leading footwear brands of Australia and New
Zealand. The analysis has highlighted that Accent Group Limited is dealing with intense
competition in the business segment of Athletic footwear from Nike, Reebok, etc. which is
impacting its profitability and market share. Hence, to overcome this report has suggested the
company to adopt differentiation and focus strategy under which it can differentiate its
business by entering in dealing with formal shoes along with athletic footwear. Along with
this, the company must drag its attention to athletic footwear and formal footwear market in

STRATEGIC MANAGEMENT 7
order to give strong competition to its competitors. In the end the financial and non-financial
measures like market share, customer satisfaction, innovation, etc. can be used to measure the
success of the suggested strategy.

STRATEGIC MANAGEMENT 8
References
Beck, T. (2011). The Importance of Customer Relationship Management in Business Markets
(B2B) 2nd ed. Germany: GRIN Verlag.
Business Victoria. (2019). Measuring for success. Retrieved from
https://www.business.vic.gov.au/marketing-and-sales/growth-innovation-and-
measurement/measuring-for-success
IBIS World. (2018). Accent Group Limited - Premium Company Report Australia. Retrieved
from https://www.ibisworld.com.au/australian-company-research-reports/retail-
trade/accent-group-limited-company.html
IBIS World. (2019). Footwear Retailing - Australia Market Research Report. Retrieved from
https://www.ibisworld.com.au/industry-trends/market-research-reports/retail-trade/
other-store-based-retailing/footwear-retailing.html
Magretta, J., & Porter, M.E. (2012). Understanding Michael Porter: The Essential Guide to
Competition and Strategy 2nd ed. U.K: Harvard Business Press.
Market Watch. (2018). Footwear Market: Global Industry Size, Share, Trends, Growth,
Demand and Forecast 2018-2026. Retrieved from
https://www.marketwatch.com/press-release/footwear-market-global-industry-size-
share-trends-growth-demand-and-forecast-2018-2026-2018-11-20
Mckeown, M. (2013). The Strategy Book ePub eBook: How to Think and Act Strategically to
Deliver Outstanding Results 2nd ed. U.K: Pearson.

STRATEGIC MANAGEMENT 9
Reuters (2019) Accent Group Ltd (AX1.AX). Retrieved from
https://www.reuters.com/finance/stocks/company-profile/AX1.AX
Scheele, D. (2014). The trade-off between cost leadership and differentiation 1st ed.
Germany: GRIN Verlag.
Williams, R.L., & Williams, H.A. (2017). Vintage Marketing Differentiation: The Origins of
Marketing and Branding Strategies 1st ed. Germany: Springer.
Zoephel, M., & Zapf, M. (2011). Michael Porter's Competitive Advantage Theory: Focus
Strategy for SMEs 1st ed. Germany: GRIN Verlag.
Zoom Info. (2019). Accent Group Limited. Retrieved from
https://www.zoominfo.com/c/accent-group-limited/355893740