Strategic Analysis and Evaluation of TK Maxx (BMP6002 Report)

This report provides a comprehensive strategic evaluation of TK Maxx, a popular retailer in the United Kingdom, and a subsidiary of the American TJX companies. The analysis begins with an introduction to strategy evaluation and its importance for businesses, followed by a background of TK Maxx, including its mission, vision, SMART objectives, and values. The main body of the report then delves into several strategic frameworks. Firstly, the VRIO framework is used to assess the company's competitive advantages, analyzing its resources and capabilities in terms of value, rarity, imitability, and organization. Secondly, the PESTLE framework is applied to analyze the external environment, considering political, economic, social, technological, legal, and environmental factors affecting TK Maxx. Thirdly, the report employs Porter's Five Forces model to examine the competitive dynamics within the retail industry, assessing the threat of new entrants, bargaining power of buyers, bargaining power of suppliers, threat of substitutes, and competitive rivalry. The report concludes with a review of TK Maxx's strategy and recommendations for future strategic direction. The report highlights the importance of clear purpose, vision, mission and objectives, values in setting the strategic direction of organizations.

STRATEGY EVALUATION

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
Background of Organisation........................................................................................................3
VRIO Framework........................................................................................................................5
PESTLE Framework....................................................................................................................5
Porter’s Five Forces Model.........................................................................................................7
Review of Organisation’s Strategy..............................................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Strategy evaluation is very necessary task for each business or companies, because by
evaluating strategies a business can easily find out those ways which can run it’s all business
strategies on progressive path. Currently top-level management within most companies is putting
huge efforts for making its business strategies more effective and productive. Reason is,
currently those businesses or companies are gaining huge profit in their respective industry or
sector which has effective business strategies. On the other side, many companies are highly
investing also for making their business strategies more productive. This report mainly discusses
those strategies which strategy evaluation aspect of the TK Maxx. Basically, TK Maxx is a
popular retailer within the United Kingdom which is a subsidiary of the American TJX
companies. There are various frameworks also has been used below which can support deeply
understand strategy aspect of TK Maxx.
MAIN BODY
Background of Organisation
TK Maxx is a subsidiary of American TJX companies, headquartered in Massachusetts,
United States. The TK Maxx was founded 1994 by Bernard Cammarata (Davids and Van Belle,
2017). Currently TK Maxx has expanded its business operations in many countries, like; United
Kingdom, Ireland, Germany, Australia, Austria, Netherlands etc. It means, currently it has large
share within the international retail industry. Some major factors of TK Maxx have been
discussed below;
Mission
TK Maxx has the large customer base within the retail industry of the United Kingdom.
Mainly it offers fashionable & quality clothes, bags & purses, glasses & sunglasses etc. These
are major products of this company. Currently the main mission of the TK Maxx is to increase
market share with 10% in the UK’s retail industry. Most customers within various market
segments are really like to buy different products and services of TK Maxx, but it has provided
quality products and services on favourable prices.
Vision
In this dynamic and modern world, retail industry is growing day by day. In this situation,
top-level management is able to gain effective results in the market. The company properly

understands this thing that, competition within the industry also will be raised in the future.
That’s why company’s vision to implement change within its daily operations according to the
market demand. On the other side, existing management is continuously taking various steps
towards more and more improve its products and services, because customers mostly like those
companies which has well-improved services in the market. Upper management of TK Maxx has
successfully maintained excellent communication values with its different stakeholders, because
company can’t survive in the market without them within retail industry (Ukko and et.al., 2019).
Currently most stakeholders are very satisfied with TK Maxx policies and services.
SMART Objectives
Specific: The mission of company is completely specific, because by using achieving existing
mission, TK Maxx can lead retail industry of the United Kingdom.
Measurable: The company can easily measure its existing performance by using KPI (key
performance indicator) tool.
Achievable: This mission is completely achievable, because many other companies also have
taken various steps for achieving this mission.
Realistic: Existing mission of TK Maxx is fully realistic, because it can easily increase its market
share by 10% by putting some extra-ordinary efforts.
Time-Specific: Top-level management will be able to properly complete this mission on time by
using some specific time-management schedules.
Values
Top-level management of TK Maxx always tries to maintain heat to heart it’s all
stakeholders, like; customers, employees, suppliers, shareholders etc. This is the main reason
that, Company’s most stakeholders are very satisfied with it. On the other side, company always
believes in fulfilling CSR (corporate social responsibility). This factor of TK Maxx positively
influences its customers in the market.
There are two organisations can’t achieve the same objectives based on different values,
because an organisation always needs to set values on the basis of decided objectives.

VRIO Framework
VRIO Framework is one of the best frameworks for different businesses, because this
gives great opportunity to a business for gaining huge competitive advantages within the market.
There are mainly four elements has involved in this framework which has discussed below;
Valuable: The company’s products and services has gained great value within the UK’s retail
industry, because company always provides such products to customers which has excellent
quality (Wunderlich and Beck, 2018). That’s why most people within the United Kingdom value
the TK Maxx in the market. On the other side, day by day value of its brand is increasing in this
country as well.
Rarity: Top-level management of TK Maxx has highly focused on developing some rare,
different and exclusive range of products and services. For example; currently company is
providing exclusive range of clothes which no other companies provide in the market. It has an
effective research and development team which always takes various productive steps to
maintain rarity within its products and services.
Imitability: When customers visits in its stores and supermarkets, then existing staff is
interacting within them in very proper manner. Employees of company always share each
informative of a TK Maxx’s product with different customers. Basically, its employees or stage
well-improved communication skills. That’s why many people like to visit in its stores and
supermarkets.
Organised: Top-level management has great ability to systematically organise its each operation
within the market. For example; Its stores never face issue which has based on product shortage,
because it has properly organised a productive supply chain. Currently the management is able to
run it’s all operations on progressive path with the support of its organising ability or skill.
PESTLE Framework
It is very important that the organizations which are functioning in the market have to
analyse the external factors as well as the internal factors which can impact the environment of
the operations of the company.
 Political Factors
The political factors are stable in a country which is a great advantage for the organization to
expand them globally. The organization has to follow the taxation and free trade policies which

the political parties have come up in the countries so that the organization can function
effectively and smoothly (Baker, Collier and Jayaraman, 2017). There are a lot of taxation
policies which have raised due to Brexit in EU which needs to be considered by the organization
effectively.
 Economic Factors
The country is going to be great factor for the organization because they can find labour in
the country which is cost friendly for the organization. Exchange currency is not going to make
the prices of the products get affected in the country and the unemployment in the country is also
going to reduce which is a great factor. TK Maxx is an experienced organization which is why
they have a proper plan which the organization follows in the market so that they can maintain
their reputation and functioning in the market.
 Social Factors
The products of the organization would match he lifestyle and comfort of the customers
which is a great advantage for the organization. The trends and demands of the customers are
changing which is why the company will have to get in a lot of new ideas and changes in the
company accordingly so that the organization can have a better functioning for them. The
targeted audience for this product are the people who follow the trends which are coming and
aged between 30 to 60 years because they have a higher wages and would like to invest for the
products of this company (Punt and et al., 2016). The culture and the taste of people in the
products and design is different which has to be understood by TK Maxx in the country so that
they can get the changes in the company accordingly which is going to have a better functioning
for themselves.
 Technological Factors
The technological changes in TK Maxx are high which a great factor for the organization is
because they are being able to expand themselves easily in the market. The demands of the
customers are also increasing which needs to be met by the customers of the organization so that
there is a better functioning (Grüss and et al., 2016). The research and development of the
organization is very motivated and functioning effectively which is why the trends and changes
with innovation is coming up in the market.
 Legal Factors

There are going to be a lot of difference in the legal factor when the organization expands
themselves in a new country. To keep the portfolio and reputation of the company intact in the
new market as well it is very important for the company to be able to understand and follow the
legal laws and regulations. The customer’s and employees health and safety is well maintained in
the organization which is a great factor and there is a sense of transparency in the organization so
that the company can have a better functioning for themselves for a long run in the market
(Luchinskaya and Dickinson, 2019). There are copyrights, patents, laws and other factors which
will also have to b strong of the company so that the competitive advantage in the new country
can be maintained and the company will be able to grow in the market faster.
 Environmental Factors
TK Maxx is following and improving on the environmental factors in the organization, there
is a great use of renewable resources in the organization for the operations for production to take
place. The government of the country would support companies like these to expand in the
country because there is a great advantage for the company (Haltuch and et al., 2019). The
climate is going to support the products and service of the company and the transportation and
delivery to the customers is going to be easier for the company which is going to help the
organization have higher profit margins in the market.
Porter’s Five Forces Model
Porter five forces model is analytical tool which helps business to identify all the factors
in the business environment and examine competitiveness of business activities to gain better
profit margins (Cichocka, 2016). This model also helps to evaluate strengths and weakness of
industry and develop effective strategies to convert them into opportunities effectively. TK Maxx
has adopted this model as there is high competition in the retail industry which can also impact
the market share and growth opportunity of the company negatively. This model also helps
company to understand its core competencies and limitations to resolve them and become market
leader in the global market effectively. This will also increase the brand value of TK Maxx to
reduce the risk of investment in new market which also increases the opportunity for company to
gain higher profit margins effectively.
Threat of New Entrants (Low)

There are many innovative small businesses in the global market which can impact the
market share of TK Maxx. This also reduces the potential of company to grow and gain higher
profit margins and attract more customer base. New businesses have more innovative
techno9loigy which cannot be implemented in large organisations like TK Maxx. this also
increases the threat for the company of new entrants in the market and reducing their market
and customer size gradually. it is very easy to enter into retail market due to increase in the
demand of customers and change in trends has also improved the lifestyles of customers
recently. However it is very difficult to compete with TK Maxx due to lack of capital investment
and low pricing strategies (O'Connor, 2017). Company has more experiences ands high
economies of scale to reduce th4e coot of products and gain more profit margins and
simultaneously increase customer satisfaction with high quality of products effectively.
Bargaining Power of Buyers (High)
Buyers are the king of market and every business has to develop their products and
services according to customer taste and preferences. It is also analysed that customers compare
their satisfaction with the price paid for the product and it is very essential for TK Maxx to
develop customer oriented products with different price rage according to customer income
level. Increase in the competition has also impacted customer base of TK Maxx due to low
prices strategies. This also influences the financial position of company and to compete in the
market business organisation also has to reduce their prices to maintain their customer base and
grow in the market effectively. due to low switching cost in retail industry the bargaining power
of customers is very high. TK Maxx needs to increase the product differentiation strategy which
increases the number of products and reduce power of buyers to increase profit margins in the
market.
Bargaining Power of Suppliers (Low)
Every business is dependent on its suppliers to gain more profit margins and hence this
increases the bargaining power of suppliers to change more and impact the financial position of
the company. Retail industry is very large and advanced which also increased the number of
suppliers in the global market (Quaintance, 2016). Due to brand image of TK Maxx many
suppliers are easy to collaborate with the company and increase their sales. This reduces the
bargaining power of the company and provides low cost fabrics to produce high quality apparels
according to different seasons and improve the efficiency of the company to attract more

customers and compete in the market effectively. TK Maxx has developed powerful supply chain
which also reduces the cost to deliver their products to customers and other locations effectively.
Threat of Substitute Products (High)
There is high risk of substitute products in retail industry due to increased competition
which also impact the quality of products. Due to launch of online store by the competitors has
impacted the market share of TK Maxx and reduced its sales drastically. As the company has not
adopted new technology and suffered the change of customer trends negatively. For example,
launch of online storage services has impacted the market share of offline storage businesses.
Similarly TK Maxx has to develop effective research on market trends and innovate its products
to attract more customers effectively.
Threat of Existing Rivalry
There are many potential competitors in retail industry which are investing in many
different technologies to increase their market share by attracting more customers effectively.
there is high threat of exiting competition for TK Maxx (Bajang, 2016). Company has to
improve it customer orientated activities and also improve quality of products with low pricing to
increase their satisfaction effectively. TK Maxx has to evaluate all the market players and
collaborate with them in order to increase market size to provide better products and service to
customers with lower competition to gain higher profit margins effectively.
Review of Organisation’s Strategy
Currently the TK Maxx has highly succeeded in expanding its business operations in lots
of countries with the support of its productive business strategies. Basically, currently the
company has an effective team which mainly works for developing new business to TK Maxx. It
has hired some professional strategy makers within its business environment. That’s why
nowadays this retail company is gaining huge competitive advantages within the market. On the
other side, upper management of company has given special instructions to its various
departments like; marketing, HRM, finance, production etc.to use only moderns and latest
techniques or strategies for gaining affective results. Currently its marketing team is highly
contributing in it’s all over growth, because marketing manager of company is too active in its
existing job role (Leischnig, Woelfl and Ivens, 2016). It always uses different well-developed
marketing strategies for highly promoting products and services of TK Maxx at the large scale in

the market. Top-level management of company is also using different frameworks for boosting
its various business strategies. For example; the management uses VIRO framework which helps
in providing effective competitive advantage to the TK Maxx in the existing retail industry. The
management of company always give very high priority to those strategies which can run its
business operations on progressive path.
CONCLUSION
It can be concluded that there are various frameworks available which can support TK
Maxx for gaining excellent results in the market. There is market competition within the retail
industry is increasing day by day, in which the company should use well-developed and well-
improved business strategies for gaining huge competitive advantage in the market. Currently
strategies which this company has used are completely effective, but upper management has
highly required to more develop them. Reason is, when company works with developed
strategies within market, then it can easily gain the largest market in the UK’s retail industry.

REFERENCES
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