1. The purpose of this presentation is to:
• Define the issues.
• Conclude on strategic options and their
barriers to success.
• Recommendation.

2. Todays presentation adresses 3
questions:
Which are the
strategic issues?
Which strategic
option should
be prioritized?
What is the
recommendation?

3. PRG should strive for a position among
the top 3 players in the market!
• Importent to frame the problem in order to identify
the strategic issues.
• Cornerstones in Company vision
- Building strong brand positions
- Presence in all Scandinavian countries
- Inspiring every day
• Problem definition:
What can be done in a 3-year period in order to
achieve a position among the top 3 players in the
market, and a EBITA margin of minimum 15%?

4. Players applying the generic strategy
Low cost & Wide Scope are the winners!
Low priced fashion retail, KSFs
• Fast product turnaround
• Flexibility in production
• Speed to market
• Only PL.
• High volume/low cost
• Own stores/franchise
• Scale
• Low priced fashion
Performance
• High profitability level
• Strong sales growth
• Increased market shares
• New store openings
• High stock turnover

5. Players applying the generic strategy
Low cost & Wide Scope are the winners!
Low priced grocery retail, KSFs
• High volumes
• Low cost
• Low price points
• Buying power
• Own stores
• Operational efficiency
Performance
• Significant growth in
market shares.
• Strong sales growth.

6. PRG apply the generic strategy
Wide Scope/Differentiation
Low/Medium priced suppliers,
KSFs
• The service concept
• Distribution level &
sales channel.
• Innovation
• Strong brand
• Heavy investments in
media.
Performance
• High Profitability
• Strong CAGR
• High Distribution level
• Successfull innovations
• High share of voice

7. Suppliers in Denmark are struggeling
Low priced suppliers,
performance
• Negative CAGR.
• Declining profitability.
High priced suppliers,
performance
• High Profitability level
• Negative CAGR
• High brand awareness
• Declining market shares

8. Matching O & T with S & W defines
possible issues
• Copy/Paste sales concept. SO
• Consider Acquisitions.
• Multi sales channel strategy, but
different offerings in each channel.
• Adjust sales concept & ST
add new value adding activities.
• Establish Danish subsidiary
• Offer different price levels that
meets custome demands.
Overcome weaknessess and WT
threats by:
• Consider Acquisitions.
• Consider Joint Ventures.
• Do not enter Denamark.
• Consider Acquisitions. WO
• Offer the service concept to the
grocery trade in DK.
• Consider wholesale of product
concept that adds value.
• Apply Multiple sales channel
strategy, but not the grocery.

9. Prioritizing the issues by matching them
with the problem definition
• Copy/Paste sales concept. SO
• Consider Acquisitions.
• Consider Acquisitions. WO
• Adjust sales concept and ST
add new value adding
activities.
Overcome weaknessess and WT
threats by:
• Consider Acquisitions.
• Consider Joint Ventures.

10. Conclusion
Which are the strategic issues?
Conclusion:
3 Strategic options
1. Enter DK on its own.
2. Enter DK by acquisition.
3. Enter DK by a JV.
Which strategic
option should
be prioritized?
What is the
recommendation?

11. Hypotheses 1
To reach the target on its own, the company needs initiatives
that at least enable a turnover of approx. $30 million in year 3.
• KSFs of PRG + external opportunities (market growth and
size) - Grocery channel best alternative.
• Full market entry required, i.e. preferred supplier to all the
major chains. 63% av the total accessible market is needed in
order to reach the target.
• To become preferred partner, PRG need to add
more/different values than competitors.

12. Conclusion - Hypotheses 1
PRG would probably not be able to enter DK on its own. The
barriers to success are high.
• PRG neither have the knowledge of the market, nor any
relations with key customers.
• This entry strategy is dependent on agreements with all
major customers, i.e. no/few agreements – no entry.
• If only some product concepts would be listed in each chain,
i.e. entering with a broad scope/nische strategy, would
significantly reduce the possibilities to build a strong brand.

13. Hypotheses 2
PRG can reach the targeted position in Denmark by an
acquisition.
• The targeted position, top 3, can be reached by aquiring
either Jbs, Hb Textil, Triumph or SOS Distribution (Bjorn
Borg).
Main barriers to success.
• The willingness to sell is crucial.
• Important the achieve synergies in order to reach the target.
• The evaluation of the company might differ between the
parties.
• The culture in Jbs might not fit with the culture of PRG.
• The core competencies, and resources that are available to
make the acquisition work, could cause problems.

14. Conclusion Hypotheses 2
PRG would be able to achieve the target by an acquisition of
Jbs, or Hb Textil.
• Jbs offers the best strategic fit, and are close to the required
level of profitability.

15. Hypotheses 3
PRG can reach the targeted position in Denmark by entering a
joint venture.
• A joint venture with Jbs, HB Textil or Triumph could solve the
problem.
Triumph win
Add. product categories.
Increased sales by
entering grocery channel.
Lower cost
PRG win
Access wide distribution
& to new channels.
Increased Know-How.
Low risk
HB Textil win
Suppl. price segments.
Higher sales & lower cost
More attractive supplier.
Increased profitability.
PRG win
Relations key customers.
Access to grocery channel
Assortment suppl. The
low priced of Hb Textil.
Lower cost/Less risk.
Jbs win
New prod. categories +
prod. for ladies/childr.
Opport. to expand to
other countries
PRG win
Relations key customers
Supplementing assort.
Opportunities in No, Swe
Access to channels.
Lower cost, less risk.

16. Conclusion Hypotheses 3
PRG would be able reach the targeted position in Denmark by
entering a joint venture with either Jbs, or HB Textil.
• Despite the Barriers to success
- process of partnering with other business can be complex.
- It might reduce focus from core business in Swe, No.
- Different objectives and cultures in each company might
cause problems.

17. Conclusion Hypotheses 3
PRG would be able reach the targeted position in Denmark by
entering a joint venture with either Jbs, or HB Textil.
HB Textil win
Suppl. price segments.
Higher sales & lower cost
More attractive supplier.
Increased profitability.
PRG win
Relations key customers.
Access to grocery channel
Assortment suppl. The
low priced of Hb Textil.
Lower cost/Less risk.
Jbs win
New prod. categories +
prod. for ladies/childr.
Opport. to expand to
other countries
PRG win
Relations key customers
Supplementing assort.
Opportunities in No, Swe
Access to channels.
Lower cost, less risk.

18. Conclusion - Which strategic option
should be prioritized?
Conclusion:
3 Strategic options
1. Enter DK on its own.
2. Enter DK by acquisition.
3. Enter DK by a JV.
Conclusion:
PRG should not enter on
its own.
Aquisition & Joint Venture
are both viable alternatives.
What is the
recommendation?

19. PRG should strive for an aquisition.
• Several key advantages
- Reduce its cost base
- Economies of scale
- Access to valuable skills
• Could vastly improve competitive position, and reduce any
learning curve, that otherwise would take years.
• Would remove one key competitor from market.
• Allow for entering in new sale channels in Swe and No.