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Steps in Strategic and Retail Planning

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Strategic retail planning is a systematic process that retailers use to assess their current situation, define their objectives, and develop a plan to achieve these objectives. This process involves several key steps, each of which plays a crucial role in creating a successful retail strategy.

1. Define the Business Mission

  • Definition: The first step in the strategic retail planning process is to define the business mission. The mission statement is a broad description of a retailer’s objectives and the scope of activities it plans to undertake.
  • Purpose: The mission statement answers fundamental questions such as "What type of business are we?" and "What do we need to do to accomplish our goals?" It serves as the foundation for all subsequent planning and decision-making.

2. Conduct a SWOT Analysis

  • Definition: SWOT analysis involves assessing the retailer’s internal strengths and weaknesses, as well as external opportunities and threats.
  • Purpose: This step helps the retailer understand its current position in the market, identify areas for improvement, and recognize external factors that could impact its success. It sets the stage for identifying strategic opportunities.

3. Identify Strategic Opportunities

  • Definition: After conducting the SWOT analysis, the next step is to identify potential opportunities for growth and improvement.
  • Purpose: This involves considering various growth strategies such as market penetration, market expansion, retail format development, and diversification. The retailer identifies which opportunities align with its strengths and market position.

4. Evaluate Strategic Opportunities

  • Definition: In this step, the retailer evaluates the identified opportunities to determine their feasibility and potential for long-term success.
  • Purpose: The evaluation focuses on the retailer's ability to establish a sustainable competitive advantage and achieve profitability. It involves considering both market attractiveness and the retailer’s competitive position.

5. Establish Specific Objectives and Allocate Resources

  • Definition: Once strategic opportunities are evaluated, the retailer sets specific objectives for each opportunity and allocates the necessary resources.
  • Purpose: Objectives should be clear, measurable, and time-bound. This step ensures that the retailer has a clear direction and the resources needed to achieve its goals.

6. Develop a Retail Mix to Implement the Strategy

  • Definition: The retail mix refers to the combination of factors such as product assortment, pricing, location, and customer service that the retailer will use to execute the strategy.
  • Purpose: This step involves developing a detailed plan for how the retailer will implement the chosen strategy, including how it will differentiate itself from competitors.

7. Evaluate Performance and Make Adjustments

  • Definition: The final step in the strategic planning process is to evaluate the results of the implemented strategy and make any necessary adjustments.
  • Purpose: Regular evaluation helps the retailer determine if the strategy is meeting its objectives. If the retailer is not achieving its goals, adjustments may be needed, potentially including revisiting earlier steps in the planning process.

Summary

The strategic retail planning process is a critical tool for retailers to systematically assess their situation, define their goals, and develop a plan to achieve them. By following these steps, retailers can create a coherent strategy that aligns with their mission and leverages their strengths, ultimately leading to sustained success in the competitive retail market.

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