Business Strategies Post Recession

1. Robust business strategy to guide
companies through a recessionary
period.
Neha Parashar & Vedika Saxena

2. NEED OF BUSINESS STRATEGY DURING RECESSION
CREDIT CRUNCH
RISK AVERSION
DECLINE IN SALES
LOWER PROFIT
STOCK FALL
DUMPING OF STOCKS BY INVESTORS

3. Strategic Framework

4. EXTERNAL, ENVIRONMENTAL FACTORS.
POSITION TO BE ACHIEVED IN LONG RUN.
MARKET TO COMPETE IN.
RESOURCES REQUIRED TO COMPETE.
MEANS TO PERFORM BETTER THAN THE COMPETITORS.
A
I
M
S
ARENAS
VEHICLES
DIFFERENTIATORS
STAGING
ECONOMIC LOGIC
ELEMENTS
PLAN
IMPLEMENTATION
EVALUATION
PROCESS
THE POSITIONING SCHOOL
THE RESOURCE BASED VIEW
F
O
C
U
S

5. Elements…. Contd..

6. BUSINESS STRATEGY AND ECONOMIC
RECESSION
RETRENCHMENT
STRATEGIES
INVESTMENT
STRATEGIES
AMBIDEXTROUS
STRATEGIES

7. COMPETITIVE STRATEGY IN RECESSION
ECONOMY: A CASE OF BIG BAZAAR IN INDIA
SANCHARAN ROY
Faculty, Management Studies, New Horizon College of Engineering,
Outer Ring Road, Panathur Post, Bangalore-560 087, India
International Journal of Economic Issues, Vol. 4, No. 2
(July-December, 2011) : 155-164
© International Science Press

8. Contents of the Research Paper
- PROBLEM STATEMENT- “How does a retailer utilize their competitive
strategy to increase their performance in recession economy?”
- PORTER’S GENERIC COMPETITIVE STRATEGIES
- RETAILER’S REACTIONS IN RECESSION ECONOMY
-METHODOLOGY USED
In -depth interviews were carried out with Area Managers, Sales Managers, and Store Managers. The
interviewees had been working for more than 2 years with Big Bazaar .
- IMPLICATIONS OF THE CASE
- CONCLUSION
P1: Retailers tend to exercise the
low cost focus Strategy
P2: Retailers tend to exercise the
differentiation focus strategy.

9. PORTER’S GENERIC COMPETITIVE STRATEGY

10. Implications of the Case
Source: Research Article
- Confirmed both the propositions
- Differentiation Focus in terms of
product strategy and promotion
strategy.
- Cost Focus through improving logistic
systems, reducing food wastes,
increasing employees’ effectiveness.

11. Problems/Inputs
- Declining
consumer
demand
- High operating
costs
- Meet
competition in
marketplace
- Low sales
growth
- Unprofitable
intermediaries
Reasons/Process
- Decline in
consumer
confidence
(consumer buying
behaviour)
- High cost of
operations
(Recession
economy)
- Low Purchasing
Power of
consumers.
- Slumped prices
Solutions
(Implemented by Big Bazaar)
- Everyday low pricing product.
- Improving logistic systems
- Reducing wastes
- Increasing effectiveness of the stores
- Withdrawing unprofitable products
- Differentiating product range
- Differentiating promotion program
Other Solutions
- Entering Foreign market
- Offering products directly to consumers.
- Eliminate unprofitable intermediaries in
distribution channel.
- Narrowing product lines
- Reallocation of scarce resources.
- Advertising campaigns emphasizing rational
motives- safety, reliability, and durability,
rather than image and status.
Impact/Results
- Market Share maintained without sacrifing
profit margins + Stimulation of Demand

12. Conclusion
- In particular, in recession period, retailers need to exercise a
combination of competitive strategies: low cost focus and
differentiation focus strategy.
- For focus strategy, firms need to pull unprofitable products from
the shelves, and focus on profit-driven product selection.
- In differentiation strategy, retailers need to be more selective in
which products to offer, and more creative in their promotion
strategy.