2011                                Strategic Development at Burberry                LONDON SCHOOL OF BUSINESS            ...
2011                                                                 Strategic Development at BurberryTable of Contents1. ...
2011                                  Strategic Development at Burberry   1. Recent past to the present:   1.1.    Introdu...
2011                                   Strategic Development at Burberry   1.3.    Leadership and culture at BurberryAtkin...
2011                                Strategic Development at Burberry   Corporate level strategy: This is concerned with ...
2011                                  Strategic Development at Burberry   2. The Strategic PositionThis part of the report...
2011                                   Strategic Development at Burberry     Indians have appreciation towards British lif...
2011                                   Strategic Development at Burberry    Asia-Pacific: including operations in China a...
2011                                    Strategic Development at Burberry   2.3.1. Strategic capability The ability to per...
2011                                  Strategic Development at Burberryflows and efficiency of resource usage. Let us brie...
2011                                   Strategic Development at Burberry   3.1. Business level strategic choiceAs discusse...
2011                                 Strategic Development at Burberry                         Fig 1. Ansoff‟s matrix    ...
2011                                   Strategic Development at Burberry    Franchise- a contractual relationship with so...
2011                                   Strategic Development at BurberryIn corporate level, as we saw before strategic cho...
2011                                   Strategic Development at Burberry   6. ReferencesAnnual Report (2011). Burberry: An...
2011                                 Strategic Development at BurberryRollinson, D. (2008). Attitudes and emotions: Organi...
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Strategies at burberry

  1. 1. 2011 Strategic Development at Burberry LONDON SCHOOL OF BUSINESS & FINANCE Strategic Development at Burberry Student Name: Madhumalesh Prakash Student ID: A4036664 Submission Date: 4th November, 2011 Intake: MBA Batch 8A Module Name: Strategic Planning Module Code: SP Assignment Title: Longitudinal Strategic Development Study Word Count: 4044A4036664 Madhumalesh Prakash Page 1
  2. 2. 2011 Strategic Development at BurberryTable of Contents1. Recent past to the present: ............................................................................................................ 3 1.1. Introduction ............................................................................................................................ 3 1.2. Business................................................................................................................................... 3 1.3. Leadership and culture at Burberry ........................................................................................ 4 1.4. Strategies deployed ................................................................................................................ 42. The Strategic Position ..................................................................................................................... 6 2.1. Macro-Environment ................................................................................................................ 6 2.2. Industry and market structure and competitive conditions ................................................... 7 2.3. Strategic capability, Resources and Competences ................................................................. 8 2.3.1. Strategic capability .......................................................................................................... 9 2.3.2. Resources ........................................................................................................................ 9 2.3.3. Competences .................................................................................................................. 9 2.4. Financial situation of Burberry................................................................................................ 93. Strategic choice ............................................................................................................................. 103.1. Business level strategic choice .............................................................................................. 113.2. Corporate level strategic choice ............................................................................................... 113.3. Direction and methods ............................................................................................................. 113.4. Recommendations .................................................................................................................... 134. Conclusion ..................................................................................................................................... 145. Appendix ....................................................................................................................................... 146. References .................................................................................................................................... 15A4036664 Madhumalesh Prakash Page 2
  3. 3. 2011 Strategic Development at Burberry 1. Recent past to the present: 1.1. IntroductionBurberry, one of the famous designer brands in the world was started by a 21-year old draper‟s apprentice, Thomas Burberry. This all started with a smalloutfitter‟s shop in Basingstoke, Hampshire, England (The Telegraph 2011).Burberry gained popularity during the First World War when it won the contractto supply trench coats to the British army. Later on, Burberry was also worn byHumphrey Bogart in Casablanca, Audrey Hepburn in Breakfast at Tiffany‟s andPeter Sellers in the Pink Panther.Burberry‟s main mission was to sell Britishness to the world (Friedman 2011). 1.2. BusinessBurberry markets its products to its end consumers through three channels:Retail, wholesale and licensing. Burberry sources and markets its apparel andaccessories worldwide with major markets in Spain, America and Asia Specificwhich accounts to 90% its revenue and emerging markets like China, India,Russia, East Europe and the Middle East (Annual Review 2010).The first product developed in 1880, which was responsible for Burberry‟ssuccess was Gabardine Macs- A breathable and waterproof fabric used formaking of trenchcoats. In 1985, Burberry develops „Tielocken‟, the predecessorof trench coat which was worn by army officials in Boer War. In 1914, in demandfrom War office Burberry introduced epaulettes and D rings to its products. In1920, Burberry check was registered as a trademark, and is introduced as liningfor trenchcoats (The Telegraph 2011). Later on, Burberry brand name began toappear on children‟s clothes, personal products, watches, fragrances, bikinis,shoes and home wares.Burberry was bought by Great Universal stores in 1955. The brands popularityfrom 1940s to the 1960s had waned by the 1980s. Distribution was focused insmall shops and few high market shops like Harrods. And shops like NeimenMarcus, Barney‟s and Saks in USA sold only Burberry raincoats, not the otherhigh profit margin accessories. In 2002, Great Universal store floated one thirdof Burberry, on stock market, raising £275 million and by 2005 Burberry was setindependent (Marketing 2002).A4036664 Madhumalesh Prakash Page 3
  4. 4. 2011 Strategic Development at Burberry 1.3. Leadership and culture at BurberryAtkinson explains organisational culture as reflecting and underlyingassumptions about the way work is performed; what is acceptable and notacceptable and what behaviour actions are encouraged and not encouraged(Mullins 2005). Burberry‟s culture is defined by core values like: to protect,explore and inspire, Democratic and meritocratic ethos, collaboration andconnectedness, contributing to its communities through Burberry foundation.According to Drucker, leadership is the most important factor which determineswhether a group or organisation will be successful (Rollinson 2008). Due toAsian crisis in Mid 1990s, Burberry started experiencing profit fall. It reported a£37 million drop in profits to £24.7 million in 1997, which prompted managerialrethinking and appointment of Rose Marie Bravo as new chief executive. Shewas responsible in transforming Burberry into £2 billion ultra-fashionable globalbrand. Her transformation of Burberry had become a text book example of howto transform a business that other luxury brands are sometimes said to be“doing a Burberry” (Financial Times 2004). In 2005 Angela Ahrendts, replacedBravo as Chief Executive who made changes to Burberry product line by makingchecks more stable and by focusing more on higher-margin products likehandbags and perfumes (Friedman 2011). 1.4. Strategies deployedAlfred Chandler(1963) defines strategy as „ the determination of the long-rungoals and objectives of an enterprise and the adoption of courses of action of anenterprise and the adoption of courses of action and the allocation of resourcesnecessary for carrying out these goals’. And Michael porter(1996) sees it as„Competitive strategy is about being different. It means deliberately choosingdifferent set of activities to deliver a unique mix of value’.Developing or making a strategy for a management is very complex in nature. Itneeds to be made in the uncertainty situations and may also affect theoperational decisions. New strategy developed may also involve the change inpresent culture of an organisation which is difficult and may adversely affect theperformance of the organisation. Strategies usually exist at a number of levels inan organisation. Let‟s distinguish different levels of strategies and analyse itusing Burberry‟s strategies. The strategic themes of Burberry are: Leveragingthe franchise, Intensifying non-apparel development, Accelerating retail-ledgrowth, Investing in under-penetrated markets, Pursuing operational excellence.Product and excellence underpin this brand momentum (Burberry.com).A4036664 Madhumalesh Prakash Page 4
  5. 5. 2011 Strategic Development at Burberry  Corporate level strategy: This is concerned with the overall purpose and scope of an organisation and how value can be created or added to different parts of the business (Jhonson et al 2006). This includes decisions of geographical coverage, mergers and acquisitions, and how resources are allocated to different parts of an organisation. In contrast with Burberry, Bravo adopted the strategy of International expansion to bring success in Burberry. New stores were opened including flagship stores in London, New York and Barcelona. Besides USA and Spain, Bravo also targeted Japan since it was an enormous market for company already. The results were profits soaring to £162 million by 2005, a six times increase since she took over (Jobber 2010). In regime of Ahrendts, Burberry opened stores in emerging markets such as India, China, Russia and Middle East. In 2010, the company acquires 50 stores across 30 cities, which was owned by its Hongs Kong based franchisee. The company continues to expand in emerging markets like India, Sao Paulo and Dubai either by opening new stores or establishment of regional offices. And recently, through franchise partners Burberry opened new stores in Armenia, Egypt, Israel and Mongolia (Burberry.com).  Business level strategy: This is about how to compete successfully in particular markets. This level of strategy deals with which products should be developed in which market and how to gain advantage over the competitors (Johnson et al 2006). Burberry having a single product line of fashion it has to concentrate more on this level strategy. Strategies like leveraging the franchise, intensifying non apparel development and accelerating retail-led growth can be seen as business level strategies. Ahrendts‟s digital strategy made Burberry the first luxury brand to live- stream a fashion show in 3D, to allow the customers to order products directly from the catwalk. She introduced social networking site to deepen the relation between customers and attract new devotees. Ahrendts, in a video interview claims that word-0f-mouthspreads through social networking and continues to be a positive conversation and its very powerful (Edgar 2009). As a result of all these Burberry overcame the recession and reported a profit of more than £5 billion in 2009.  Organisational strategies: This level is concerned with how different parts of organisations deliver effective corporate and business level strategies by proper allocation of resources, people and processes (Johnson et al 2006). Pursuing operational excellence can be seen as organisational strategy. This level includes steps like introducing new IT systems like SAP, where a single SAP HR database can hold information of 6500 employees in 25 countries and replacing 21 scattered distribution centres with three regional hubs in the USA (Jobber 2010).A4036664 Madhumalesh Prakash Page 5
  6. 6. 2011 Strategic Development at Burberry 2. The Strategic PositionThis part of the report is concerned with the impact of external environment,Organisation‟s resources, capabilities and core competences on the strategy ofan organisation. According to John Kay, “The subject of the strategy analysesthe firm’s relationship with its environment, and a business-strategy is a schemefor handling these relationships” (Dransfield 2001). 2.1. Macro-EnvironmentOrganisation needs to be in tune with the environment. Therefore there is aneed of market scanning to make appropriate strategic responses, which can bedone by Pestle analysis. Pestle analysis looks at political, economic, social,technology, legal and environmental factors which affect the organisation(Dransfield 2001).  Political: Political factors include Government stability, taxation policy, foreign trade regulation and social welfare policies. Burberry needs to consider the trade regulations and taxation policy when sourcing or marketing products to parts outside Europe. Burberry, sources 60% of its raw materials from Europe, which makes the group strongly unaffected by Chinese imports impacts of Yuan/dollar de-pegging (Zekaria 2010).  Economic: This may contains factors like Inflation, unemployment, interest rates and money supply. Economic deceleration, in UK, began in 2008 when GDP contracted by 0.1% and the economy contracted by 4.9% by 2009 because of the slowdown in the global economy. Though the economy recovered in 2010, this slowdown has adversely affected the creation of jobs in the country. Nearly 2.5 million were unemployed in 2010 (UK Country profile 2011). Burberry needs to monitor the inflation rates as it may directly effect on the buying capacity. For example, when recession hit UK, stocks stumbled to £1.60, and pressurised Ahrendts to cut costs by £50m and staff by about 10 percent (Friedman 2011).  Socio cultural: Factors like population demographics, income distribution, lifestyle, consumerism and social mobility comes under Socio-cultural factors. The brand is defined by: Britishness, Democratic luxury positioning, Authentic outwear heritage and historic icons, which makes it so popular among the people. As we saw before investing in under- penetrated markets is one of the strategies of Burberry. So, it has to explore the socio-cultural factors of the emerging markets. As said by Christopher Bailey about India, “it‟s a country we are so excited by. They have huge appreciation for luxury and Britishness”. This implicates thatA4036664 Madhumalesh Prakash Page 6
  7. 7. 2011 Strategic Development at Burberry Indians have appreciation towards British lifestyle, which brings success to Burberry in India.  Technological: This includes factors like new discoveries/developments, speed of technology transfer and rates of obsolescence. As we saw before Burberry was the first luxury brand to live stream a fashion show in 3D, where consumers could buy products directly from the catwalk. And introduction of social networking sites and websites like artofthetrench.com where customers like customize their products are few examples of the technologic usage in Burberry.  Environmental: Any organisation should consider these factors like environmental protection laws, waste disposal and energy consumption. Burberry renewed focus on diverting waste from landfill. Burberry‟s recycling partner has converted over 130 tonnes of samples and raw material waste into car door insulation (Burberry.com).  Legal: Legal laws like competition law, employment law and product safety should be considered by an organisation to develop or protect the strategy. Burberry faced a problem of copycats, which infringed its trademark. Burberry claimed to spend £2 million a year to fight these counterfeits. It uses an Internet-monitoring service to help pick up the discussion and it also works with custom officials and local police to seize and sue fakes (Jobber 2010). 2.2. Industry and market structure and competitive conditionsThe industry structure defines the levels and roles in an organisation. There arenumber of discrete structural forms like: entrepreneur, functional, divisional,holding company and matrix structures. According to Roy Watts, Chairman,Thames Water, “Autonomy is what you take, not what you are given”(Thompson 1997). Burberry‟s industry structure can be seen as entrepreneurialstructure or functional structure. Entrepreneurial structure as the organisation isorganised wholly around the chief executive, Ahrendts. Functional structure, likeall the functions such as production, finance, marketing and HR is controlled bychief executive. And, Christopher Bailey as creative head responsible for theproduction. Advantages of these structures are: they are centralised, relativelyless overheads and simple lines of control (Thompson 1997).As we saw before, Burberry sells its products to its end customers through retail,wholesale to different parts of the world. Let us see the revenue from differentmarkets and different channels (Burberry.com):  Americas: constitutes to 27% of the total revenue which includes business in US, Canada, Central and South America.  Europe: this includes the operation in Europe excluding the Spanish operation and accounts for 34% of total revenue.A4036664 Madhumalesh Prakash Page 7
  8. 8. 2011 Strategic Development at Burberry  Asia-Pacific: including operations in China and Japan this market is growing rapidly constituting for 33% of the revenue for Burberry.  Rest of world: this includes operations in India and Middle East which constitutes for 6% for its total revenue.  Retail: This channel accounted for 64% of its total revenue including 174 stores, 199 concessions with departmental stores and 44 outlets, as well as digital commerce across the world.  Wholesale: 29% of revenue for Burberry comes from this channel. This includes sales to departmental stores and its franchises mainly in emerging markets.  Licensing: Remaining 7 % of revenue comes from licensing, including royalty income received from licenses in Japan, its global licenses for fragrance, eyewear and timepieces, and a small European childrenswear license.Competitive conditions can be analysed by porter‟s five forces framework whichhelps in identifying the sources of competition (Johnson et al 2006).  The threat of substitutesThere are lot of luxury brands which have established their names in the fashionindustry.  The threat of new entrantsFashion industry is ever growing and there may be threat of new and cheaperbrands entering the market.  The power of suppliersNeed to have good relation with the raw material suppliers and need to havemany suppliers. Relying on one supplier may be a risk if supplier fails to deliverat time.  The power of buyersThe inflation or economic downturn affects the buying power of the customers.More customers are likely to become price sensitive.  Competitive rivalryThere is danger of intense competition from the rivalries like Mulberry and Guccias one they attempt to gain competition over other.2.3. Strategic capability, Resources and CompetencesThe resource-based view of strategy: The competitive advantage of an organisation is explained by an organisation is explained by the distinctiveness of its capabilities.A4036664 Madhumalesh Prakash Page 8
  9. 9. 2011 Strategic Development at Burberry 2.3.1. Strategic capability The ability to perform at the level required to survive and prosper. It isunderpinned by the resources and competences of the organisation (Johnson etal 2006). Its well reputed brand name, britishness, democratic luxury positioningand its appeal to customers make it able to survive and prosper rapidly.Burberry‟s capability can be measured by facts like; Kate Middleton wore aBurberry trenchcoat during her coming out phase of Princess-to-be (Friedman2011). 2.3.2. Resources Resources can be of two types- tangible and intangible resources. Tangibleassets consists of physical assets of an organisation such as plant, labour andfinance, whereas, non-physical assets such as information, reputation andknowledge forms the intangible assets of an organisation (Johnson et al 2006).Burberry has a list of rich intangible resources from its 154 years past history.At present Burberry is one of the leading British luxury brands. Going to thehistory, Burberry was awarded Royal warrant two times in 1955 by QueenElizabeth and Prince of Wales in 1989. And Burberry won many awards for itsdesign and innovation like 2010 British Fashion awards (Friedman 2010) whichbuilds up their reputation. 2.3.3. CompetencesThese are the activities and processes through which an organisation deploys itsresources effectively (Johnson et al 2006). Burberry‟s new and core competenceis the digital innovation. This is driven by the desire to “connect customersdirectly to the brand”. It can be either the live-stream of fashion show in 3D orthe artoftrech.com website where customers can customize their own design.Other competence was to endorse the brand through advertisements featuringcelebrities such as Beckhams, Elizabeth Jagger and Nicole Appleton. 2.4. Financial situation of BurberryIn this section let us see the current financial situation, as a result of strategiesdeployed as discussed before. This is done by few ratios derived from thebalance sheet and income statement of the company. Ratios are used formeasurement of the organisation‟s performance, comparison of one year withanother for detecting improving or deteriorating trends, for forecasting cashA4036664 Madhumalesh Prakash Page 9
  10. 10. 2011 Strategic Development at Burberryflows and efficiency of resource usage. Let us briefly see some key ratios whichexplain the present financial situation of Burberry.Table1: Ratios calculated. (See Appendix)  ROE: This measures the return from profit after interest and tax have been deducted to shareholders capital. As calculated it is 28.2%, which means for every £100 investment you will get back £28.2 which is very good.  Gross profit: This measures the profit after direct unit costs as %sales. As seen in the above table gross profit for 2011 is 67% which is a good sign for Burberry and its shareholders.  Current ratio: This measures the cash position of an organisation. If the ratio is more than one, it means company can pay its liabilities from its assets. Current ratio of Burberry is 1.63 which means they can not only clear the liabilities, they can even invest for new diversifications.Some other ratios like ROCE, ROS and Gross gearing ratios can also becalculated for determination of a company‟s situation. 3. Strategic choiceStrategic choice involves understanding the underlying bases for future strategyat both the business and corporate level and the options for developing strategyin terms of both the directions and methods of development (Johnson et al2006).The variables for determining strategic choice are: Economic or technologicalsector choices, value network position choices, product/market sector choices,resource and capability choices, generic strategies and development routes.A4036664 Page Madhumalesh Prakash 10
  11. 11. 2011 Strategic Development at Burberry 3.1. Business level strategic choiceAs discussed before this strategy is about how business units competesuccessfully in markets to meet the needs of their customers. This is consideredby examining the generic choices of the bases of competitive strategies know asthe „strategy clock‟ (Johnson et al 2006). The options in the strategy clock are:no frills, low price, hybrid, differentiation, focused differentiation, increasedprice/standard value, increased price/low value, low value/standard price.Precisely, these options can also be seen as:  Price based strategies- seeks to achieve lower price than competitors with same quality of products,  Differentiation strategies- seeks to provide products different from those of competitors and that are widely valued by buyers,  Hybrid strategy- seeks to achieve both price and differentiation strategy,  Focused differentiation strategy-seeks to provide high perceived product, justifying a substantial price premium, failure strategy- does not provide value for money nor perceived products. 3.2. Corporate level strategic choiceIn this level, developing strategy for future comes with an option ofdiversification. It is a strategy that takes an organisation into both new marketsand new products. Diversification can be of two types  Related diversification- involves in strategy development beyond the current products and market but within the capabilities and values of an organisation. Related diversification takes different forms like: Vertical integration- is forward or backwards integration into adjacent activities in value network, horizontal integration- is development into activities which are complimentary to value network.  Unrelated diversification-means strategy development beyond current capabilities and value of the organisation. 3.3. Direction and methodsFor better understanding of development of strategic options for growth can beanalysed by Igor Ansoff‟s matrix of strategic options (Johnson et al 2006). Thismatrix compares the alternative of developing new products and markets.A4036664 Page Madhumalesh Prakash 11
  12. 12. 2011 Strategic Development at Burberry Fig 1. Ansoff‟s matrix  Market penetration- This involves in selling of same products to same customers or market segment using excellent marketing skills or by increasing the market share or by developing competitive advantage or by growing the total market size.  Product development- This option involves in developing new products for the existing customers in order to satisfy their changing lifestyle.  Market development- This involves in creation of new customers which is more difficult than creating new products. But for brand like Burberry with global approach it is not difficult to create a new market.  Diversification-This involves in developing both in terms of product and markets. This is often done through acquisitions, because of the difficulty of developing both new products and market.The above section showed the direction for the development and now let us seesthe available methods for this development and their advantages anddisadvantages in brief. The methods include:  Organic or internal development- where strategies are developed by developing organisation‟s own capabilities. These have advantages of enhancing knowledge and learning and no need of searching suitable conditions available for mergers or acquisitions.  Mergers and acquisition- strategies are developed by taking over ownership of another organisation.  Equity Alliance- two or more organisations share resources to develop a strategy. These have advantages of financial risk which is shared with partners and combination of resources which may helps in development of unique product. This method also has difficulties in identifying the appropriate partner and maintaining proper relationship with the partners.A4036664 Page Madhumalesh Prakash 12
  13. 13. 2011 Strategic Development at Burberry  Franchise- a contractual relationship with some businesses operating under the organisation name and guidance with an exchange of fee. This is a form of non-equity alliance.  Licensing- permission to engage in certain activity by authority of an organisation. This is also a form of non equity alliance.According to Claudio Aspesi and Dev Vardhan, “The best strategy for anycompany is a strategy it can implement. Before you choose one, think aboutwhat your company already does well” (Dransfield 2001).Having the strategicoptions, direction and methods it‟s necessary and important to analyse thesuccess criteria of the planned options. There are three main success criteria:Suitability: These concerns whether the strategies planned fit the situation. Toolssuch as Pestle analysis give a clear picture about the relationship between theinternal organisation and external environment. And, it needs to look at whetherthat strategic option provides a suitable use of resources in given environment.Accessibility: This is concerned with whether that strategy is acceptable by theorganisation and its stakeholders. These depend on three main types: return,risk and shareholders reaction.Feasibility: this is about whether the strategy planned can be implemented inreal practise. These criteria can be accessed by analysing the organisation‟sstrategic capabilities. 3.4. RecommendationsHaving studied all the options, directions and methods of strategy developmentlet us recommend and discuss some strategic choice for Burberry.In business level, Burberry cannot adopt price-based strategy because ofdisadvantages like margin reduction and inability to reinvest. And, Burberry hasdeveloped its brand name as a Royal luxury brand which will be affected if itfollows price-based strategy and will lose high class customers. Burberry canadopt focus differentiation by providing high perceived goods with superiorquality and new designs, which justifies the premium price. Market penetrationand product development discussed in Ansoff matrix comes under this level.Market penetration can be done by increasing the market share or by developingcompetitive advantage or by growing the total market size. This can be doneorganic method of development by increasing the number of retail shops in theexisting markets. Product development can be done by appointing new youngdesigners and adding value to the new products by famous celebrityendorsements. Product development can be done by organic method or licensingfor new accessories.A4036664 Page Madhumalesh Prakash 13
  14. 14. 2011 Strategic Development at BurberryIn corporate level, as we saw before strategic choice is diversification. The twostrategic directions: market development and diversification in Ansoff matrixcomes under this level. The vertical integration can be done by acquisition of thetextile industries supplying raw materials or by acquisition of rival companies likeGucci. The acquisition again should be done after analysing the criteria seenbefore. Methods of Joint venture/ Alliance can be used for horizontal integrationby contractual relationship with high end sports car brand for the production ofits merchandises. For example, Puma produces clothing and other merchandiselike bags, wallets for Ferrari and Ducati. 4. ConclusionBurberry, a must-have fashion brand in Britain started in 1856 produced coatsfor army officials. In just few years it lost its old cultural status and developednew cutting-edge trends to become a modern luxury brand. With a key strategyof brand extension and it‟s very British image it soon became popular in US andAsian markets. As we saw in the report, the leadership skills of Bravo andAhrendts played an important role in developing and execution of strategies forthe development of its unique resources and core competences. Burberry‟sadoption of related diversification had led to its success. It operates in only onevalue network of fashion which makes it to concentrate more on it and growradically through franchises and licensing. The studies also shows the strategyshould be adopted in proper times by a lot of analysis like PESTLE and thesuccess criteria needs to be analysed before executing any strategy. It is alsoseen that strategies deployed by Burberry have resulted in good financialsituation. In simple words, “All is well in Burberry” because of its past andpresent strategies. 5. Appendix Return on Equity(ROE) = (Net profit after tax/ Shareholder‟s Equity)*100 ROE of Burberry: (212.5/733.3)*100 = 28.2% Current ratio = Current assets / Current liabilities Current ratio of Burberry: 870.1/534.3 = 1.63 Gross profit margin = Gross profit/ Sales revenue Gross profit margin of Burberry: 1009.7/1501.3 = 67%A4036664 Page Madhumalesh Prakash 14
  15. 15. 2011 Strategic Development at Burberry 6. ReferencesAnnual Report (2011). Burberry: Annual report 2011, [online]. Available at:http://201011.annualreport.burberry.com/ (Accessed on 1/11/2011)Annual Review (2010). Burberry: Annual review 2009-2010, [online]. Availableat : http://annualreview2009-10.burberry.com/pdf/burberry_group_overview.pdf (Accessed on 1/11/2011)BBC news (2002). Business: Burberry‟s journey through fashion, [online].Available at: http://news.bbc.co.uk/1/hi/business/2015039.stm (Accessed on1/11/2011)Chandler, A.D. (1963). “Strategy and Structure: Chapters in the History ofAmerican Enterprise”, MIT Press, 1963, p 13.Porter, M.E. (1996). “What is Strategy?”, Harvard Business Review, 1996,November-December, p 60.Dransfield, R. (2001). Scanning the environment: Corporate strategy.Heinemann Educational: Oxford.Edgar, R. (2009). Burberry targets the Facebook generation with social network,Financial times, [online]. Available at: http://www.ft.com/cms/s/0/e7de1d54-a321-11de-ba74-00144feabdc0.html#axzz1c55heSJw (Accessed on 1/11/2011)Financial times (2004). Rose Marie Bravo Chief Executive, Burberry, [online].Available at: http://www.ft.com/cms/s/0/831be07c-1348-11d9-b869-00000e2511c8.html#axzz1c55heSJw (Accessed on 1/11/2011)Friedman, V. (2011). Woman in the new: Angela Ahrendts, Financial Times,[online]. Available at: http://cachef.ft.com/cms/s/0/e2f598ea-6d13-11e0-83fe-00144feab49a.html#axzz1c9fL22j7 (Accessed on 1/11/2011)Johnson, G., Scholes, K. and Whittington, R. (2006). “The Environment”,Exploring Corporate Strategy, 7th edition. Prentice Hall: United Kingdom.Marketing (2002). Great British brands: Burberry- Fashionable from the 1920s,Burberry declined with deferential society but is new born, [online]. Available at:http://www.marketingmagazine.co.uk/news/154758/ (Accessed on 1/11/2011)Mullins, L.J. (2005). Organisational development: Management andorganisational behaviour, 7th edition.A4036664 Page Madhumalesh Prakash 15
  16. 16. 2011 Strategic Development at BurberryRollinson, D. (2008). Attitudes and emotions: Organisational behaviour andanalysis-An Integrated approach, 4th edition. Pearson education: UnitedKingdom.The telegraph (2011). Burberry: a history, [online]. Available at:http://www.telegraph.co.uk/finance/newsbysector/retailandconsumer/8455689/Burberry-a-history.html (Accessed on 1/11/2011)Thompson, J.L. (1997). Strategic Management: Awareness and Change, 3rdedition. Thompson Business press: United Kingdom.UK country profile (2011). The UK: In depth PESTLE insights. (Cover story), p1-81.Zekaria, S. (2010). “Burberry has Reasons to be Bullish”, The Wall StreetJournal,[online]. Available at: http://blogs.wsj.com/source/2010/07/13/why-burberry-has-reasons-to-be-bullish/ (Accessed on 1/11/2011)Figure 1: Ansoff‟s Matrix, Available at: http://www.paramountlearning.co.uk/wp-content/uploads/2010/02/ansoff-matrix.jpg (Accessed on 1/11/2011)A4036664 Page Madhumalesh Prakash 16

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