Macy’s

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Macy’s
Macy’s Inc. comprises of different high-quality name brand products that are categorized in a variety of categories. This contributes to the large number of products that Macy’s sells which then boosts their sales. The success of the department store is because they have adapted the mergers and acquisition economic attribute. Macy’s Inc is a global company, and therefore they aim at dominating the market since they merge with other companies which help occupy more shelf space. With the increase in volume, Macy’s Inc. has gained much control on the suppliers while at the same time reducing the procurement costs which in turn has significantly boosted their profitability. Some of the brands merged with Macy’s Inc are Calvin Klein, Ralph Lauren, Ann Klein, and Tommy Hilfiger.
The business world has been experiencing a lot of changes which affect sales, but Macy’s Inc. has managed to remain one of the most profitable retailers in the retailing industry (Kumar, Anand and Song 97). With such changes in the industry, owners need to understand that it is crucial for them to evolve strategy and perform faster so as to make the results compelling and relevant to the customers. In 2016, Macy’s announced that they had a new plan that would guarantee their success. They transitioned by naming Jeff Gennette the chief executive and Terry Lundgren the executive chairman (Grant 208). Another success factor is the alignment of growth when Macy’s Inc. acquired 68 stores in 2016 and hoped the number would grow over the years.

This approach helped the company gain more physical stores which then allowed customers to shop in any way and at any time.
Macy’s usually provides both national and private brands and are the same in the merchandising sectors (Herstein, Gilboa and Gamilel 331). Some of their trends are men’s, women’s, and children apparel, shoes, home decors, and beauty accessories. Being such a well-recognized brand in the United States, Macy’s Inc. has the potential to take that and use it to market their company globally. They have been such a success in the USA and therefore venturing globally would be a success.
Macy’s Porters five analysis
Rivalry with competitors
Macy’s Inc is always looking for new ways to add benefit and value to their merchandise which has, in turn, led customers to stay loyal to the company. They, however, do not do this at the expense of the sellers and buyers. Their main competitors are JC Penney and Dillard’s Inc.
Threat of substitute product
This is not such a threat since the merchandise from Macy’s is of high quality. The only threat to the designer brands is the counterfeit products which are sold at unreasonably low prices.
Bargaining Power of Buyers
Customers are usually searching for products with the best prices, therefore causing a lot of competition. The introduction of online shopping allows them to compare the prices and get the best deals.
Bargaining power of Suppliers
Macy’s Inc is known to provide high-quality designer brand goods at a discounted price. However, if their suppliers decided to increase the prices of their product or fail on the quality, Macy’s would suffer as they would be forced to reduce prices which would take away their customers.
Threat of New Entry
Macy’s is competitive but also imposes a barrier to new companies. The company works hard to differentiate their product and sell them at affordable prices. However, a new company may have lower prices for the same products, but since they are not well established, they would have difficulty penetrating the industry.
Macy’s has taken pride in their product differentiation, customer service and price. However, they are always competing with companies like JC Jenney using the same strategies. JC Jenney has managed to master these strategies which have been a challenge to Macy’s Inc., the company, as well as their competitors, suspect the future will be fickle and therefore try to make the necessary changes.
Works Cited
Grant, Robert M. Contemporary strategy analysis: Text and cases edition. John Wiley & Sons, 2016. Print.
Herstein, Ram, Shaked Gilboa, and Eyal Gamliel. “Private and national brand consumers’ images of fashion stores.” Journal of Product & Brand Management 22.5/6 (2013): 331-341.
Kumar, V., Ankit Anand, and Hyunseok Song. “Future of retailer profitability: an organizing framework.” Journal of Retailing 93.1 (2017): 96-119.