Strategic Management and Business Policy: Williams-Sonoma

Strategic Management and Business Policy: Williams-Sonoma 1. If the Williams-Sonoma continues with its present strategies and objectives, where will it be in 5 years?

If the Williams-Sonoma carries on with its present strategies as well as objectives, then there is a possibility that they will have a positive revenue growth which will contribute to additional stores in the next five years. However, this is only possible if Williams-Sonoma’s management goes on and explores other revenue generating avenues. They must differentiate the strengths of the company, the flexibility of the strategies, and objectives in place as well as their commitment to financial discipline. The bottom line is that they should keep on improving these strategies and objectives, especially the introduction of the Pottery Barn website. I believe it would also be important for the company to expand its product line and venture into retail home furnishings like home décor.

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This can be implemented in the Pottery Barn website which resulted in a 500% jump, generating a commendable amount of revenue (Rouse 2005). However, William-Sonoma should also consider reducing its prices in order to accommodate customers who are not included in the 10% range. This will keep the company flourishing for the following five years. Since the old times have changed, the fact that they have decided to venture into internet distribution channel is another way that could take this company to greater heights.

2. If you were the CEO of William-Sonoma, what strategies would you recommend, and why?

One of the strategies I would recommend if I were the CEO of William-Sonoma is to implement an interactive website where customers would have the opportunity to interact with customer service executives and raise their concerns. The benefit of this kind of interaction is that the company will be able to improve its products and services. Again it would also be easy to handle any customers with complaints through the company-customer feedback system. It would also be a good idea for William-Sonoma to find means and ways of reducing costs associated with the suppliers. One of the strategies that can be used to reduce inventory costs is to make use of routine demand forecasting (Cox 2006). Excess inventory costs can also be reduced or eliminated by reducing lead times for product acquisition (Cox 2006). Lowering inventory holding costs will also enable the company to improve the utilization of space.

William-Sonoma should also try as much as possible to incorporate the old in their Pottery Ban concept. This will also help in boosting the company’s total revenue because they would now have a new target market in a different age group.

3. Describe the competitive strategies used by each of Williams-Sonoma's competitors.

Which of these strategies are the most effective? Support your answer.

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Crate & Barrel’s effective strategy has been its store displays that are difficult to copy.

This is one of the best strategies that can be used to attract customers into the stores. The other strategy used by Crate and Barrel is to market its products through websites and catalogues.

Restoration Hardware on the other hand has managed to engage in direct-to-customer sales, a move that increases customer loyalty. Their main idea of targeting 10% of the wealthiest people provides a wide loop that can be filled by the rest. This shows that Restoration Hardware is a company that not only focuses on the rich, but also cares about the middle class as well as the poor.

Pier 1 Imports strategy is not very effective since it is based on a store-within-a –store format. The Bombay Company’s focus on classic traditional furniture is one of the strategies that focus on a single taste. It would be much better if they introduce modern classic furniture because not everyone likes traditional concepts.

The strategy used by Door Store can be viewed as one that can contribute to future growth. Providing quality products to customers is a move that also creates better customerretailer relationship, thereby providing more sales generated through customer referrals.

From all these strategies used by these competitors, the most effective is the one used by Crate & Barrel and Door Store. Marketing through websites is a way of reaching more customers globally and also makes it easy to attend to customers over great distances.

4. How is Williams-Sonoma using the Internet as a distribution channel now, and how would you recommend that they use the Internet in the future?

William-Sonoma is using the internet as a strategy to increase its revenues by targeting many global markets. It is also a way of reducing marketing costs especially those associated with traditional distribution channels (Pitt & Berthon, 1999). However, there are several factors

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that must be considered when establishing an online distribution channel. First of all, the company must ensure that its website is attractive to customers, and also provide easy entry.

They must also analyze and agree on the appropriate products that should be distributed electronically. Consumer activities and consumer segments should also be considered because not every group will adapt to electronic distribution. I would recommend that William-Sonoma invest much in its internet infrastructure and staff in order to create an infrastructure that is both supportive to the company and the customers. William-Sonoma should also consider determining which markets can be vulnerable when attacked. When considering this aspect, it is also important to observe the competitors or prospect companies that might also introduce internet distribution channels. It is clearly evident that companies that do not take time to consider vulnerabilities as well as opportunities in the online industry can be surpassed by those companies that take much consideration.

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Cox, R. (2006). 25 Ways to lower inventory costs. Retrieved June 11, 2012 from http://multichannelmerchant.com/opsandfulfillment/advisor/lower_inventory/ Pitt, L., & Berthon, P. (1999). Changing channels: The impact of the internet on distribution strategy. Business Horizons, 42(2), 19 Prophet Website, (2012). Driving growth through a new channel. Retrieved June 11, 2012 from http://www.prophet.com/impact/projects/williamssonoma Rouse M. M. (2005). Internet Mini Case #6 - Williams-Sonoma. Retrieved June 11, 2012 from http://www.pearsonhighered.com/wheelen/cases.html