FIVE YEAR STRATEGIC FOR SPORTS DIRECT

Introduction

Sports Direct International plc is, with 17,207 employees one of the largest sports retailer group in the United Kingdom, operating more than 660 stores worldwide. The company is publicly listed on the London Stock Exchange denoted with the ticker symbol SPD and was founded in 1982 by entrepreneur Mike Ashley; the current majority shareholder who as of today holds 61.7 percent of the outstanding shares.

Mike Ashley has been running Sports Direct business since 1982 just like a Victorian house. The business was started as a small enterprise and has gradually grown into a big chain company with 670 stores (Datamonitor (firm), 2000). However, the company is in the news for its lousy HR practices and policies. The company is neglecting its employee’s, mainly temporary staff. It is highly being criticized for its working practices because of the minimum wages paid to the temporary workers. The six strikes policy of the company is brutal in the much ways-instant dismissal of temporary employees, poor grievance, and disciplinary procedure. There is a big dispute regarding zero- hour’s contract and permanent contract employees because of the difference is shown by the management. There is no signed contract between the employment agencies and Sports Direct. Although the company is known as a high street retailer company, it is closer to a Victorian house because of the working practices followed by it. The company looked its employees as commodities in its stores rather than humans with rights, aspirations, and responsibilities (Farrell, 2018). With six-strikes-and-you’re-out policy, the company is sacking its employees with six black marks. For all these practices, the company is being highly criticized forcing the government to pass some serious legislation. Despite all these challenges, the company has continued to grow and still retain the number one spot when it comes to retail of sportswear. However, there are still some improvements that can be made to ensure that more success is realized. This paper will give out a five-year strategic plan for sports direct international plc highlighting the company’s aims or Objectives, explaining the cooperate and operational strategies and finally use the Gantt chart to show when things will happen over the next five years and key milestones.

Key findings from situational analysis

Sports direct international plc is the number one sports retailer in the entire United Kingdom, and it also has an online selling platform for the international market. The company has continued to enjoy continuous since 1982 making it a trustable brand. It has also tied up with legendary brands such as Reebok, Adidas, and Nike among others. The company also has a strong online presence making a significant portion of their sales using this platform. However, the sports industry market is quite competitive resulting in slow growth. There are however many opportunities that can be utilized to maximize profit. The rising cost of the raw materials a challenge that the company face and also the Tax changing policy that all affects functioning.

Company’s Aims and Objectives

Mission: the group’s mission is to be a leading lifestyle and sports retailer in the world as well as offer them sustainable growth to our shareholders from a medium to long-term through offering our customers an incomparable range of high-quality products that lead in the market.

Sports Direct Objectives

  • To make identification through acquisitions of our brand and property enhancement. Through this, they aim at gaining the attention of our customers and selling the best of the products to them. Boosting property will enable improvement of the brand’s name and the group’s name despite criticism that may be there. Sports direct is a major company in the world that deals with sportswear in retail needs to work on its terms and conditions that it uses on selling its products and maintaining the name high and their customers.
  • Protecting the existing products and facilities. They seek to protect sports, recreational buildings and the brand of sportswear used in the fields. They expect to see our sportsmen and women in the best wear possible to maintain even their confidence as they play. Having several fields to maintain too and protect together with some recreational buildings they expect to retain them or enhance them as part of a redevelopment unless there is a demonstration of an assessment indicating an excess provision and excess to requirements or clear evidence that supports relocation. Also, they aim at giving the customers what they are used to and not lowering the brand quality and by maintaining the level of marketing that they offer. Reducing it would lead to reduced number of customers who trust the company since they will have a fear of coming and miss the product they required (Hoye, Smith, Nicholson, and Stewart, 2015).
  • Enhancing accessibility and quality of our products. They have always wished to see the best use made of the existing sports products that they produce via improving the quality of the products their accessibility to our customers and the marketing part. We have developed a way to improve on the marketing and accessibility of this product that they are now aiming at offering free deliveries for those who buy large quantities of the products and opening some sub-branches in a different location. Aiming at school sites to advertise on our products is one way that they can maneuver through to reach our customers and enable them to get the products easily (Shank, and Lyberger, 2014).
  • Provision of new brands of sportswear to meet the customer’s demand. The customers have been suggesting that they sell even the unknown brands from different companies that are also pocket-friendly. Sports direct aims at coming meeting the demands of our customers and maintaining their trust in our company that they can provide all things that favor them.  They also look forward to expanding or increasing the numbers of the existing brands to continue meeting the older demands. That will increase the number of customers coming in, and the name of the company will continue trending (Shank, and Lyberger, 2014).

STRATEGIES

To achieve the above strategies, it is important to have proper strategies that will enable the company to progress even further. Strategies can be either cooperative strategies or operational strategies. Cooperative strategies are concerned with how big firms such as Sports direct international plc create value for various businesses. On the other hand, operational strategies are the methods that Sports direct international plc will use to attain the objectives it has for the next five years. The following are some of the strategies that the company will use to achieve the desired objectives and aims.

Creating a good reputation

Sports Direct has been under increasing pressure from the British press after it was unveiled that employees were subject to very poor working conditions in the company owned warehouses (Alberts, R.W., 2015, p. 180). Additionally, they have been caught underpaying staff against the national minimum wage rate of £6.70, by 20 pence per hour and forcing them to go through searches at the end of each shift, including underwear checks. Furthermore, a BBC investigation revealed that ambulances were called more than 70 times over a two year period to the headquarters, as staff became concerned that if they rang in sick, they risked losing their jobs. Therefore, it is the responsibility of the company to react and change this forever.

In the next five years, the company should aim at treating people with utmost respect and dignity. Also, the company opts to ensure that all the workers regardless of their impact have the opportunity to be empowered, motivated, stimulated and inspired. It is important for the company to realize that it takes the effort of every single member to drive performance or make a difference. Therefore, there should a well laid out procedure to make sure that all employees are rewarded appropriately to motivate them to join the company’s future goals.

Furthermore, a group approach should be made to ensure there is continuous development of employees. When employees have a continuous development, they are able to realize their full potential and in the process drive an institution towards its main objectives (n.d.). Additionally communication between the management and its employees should be enhanced. Proper communications should happen through briefing the managers directly, training programs, groups staff portal, emails, letters, the intranet and through staff app. Also, the HR department should be given more duties of ensuring that all the claims and welfare of employees are met. In five years, the company’s employees should have the best health care and compensation benefits in the country. This will be done by improving the welfare budget to cater for the employees just like a 21st-century business should do.

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Market Enlargement

The strategy of sports direct is mostly to invest in the people and the key third-party partners so that they may elevate their retail proposition to get new levels of merit across the multi-sport, multi-brand offering to our customers. However, the main strategies that sport directly have for the better of their company are:

  1. Local Sports Retail

Sports direct aims at offering a full multi-channel retail method across multiple fascias. They also have an aim of supplying their local customers with the broadest collection of leisure and sports equipment and attire from the leading brands in the world. The company also aims at operating on fitness gyms that will combine with sports retail destinations as they seek the elevation of their retail proposition that would include flagship style and new generation styles. The sports direct company aims at doing all that at key points in the United Kingdom and Ireland. Improving on local marketing is important as it is easy to maintain customers and attract others easily as they have the good name of the market (Shank, and Lyberger, 2014).

  • International Sports Retail

That includes all group’s sports stores that deal with retail sales, operations, and management outside the United Kingdom which includes places like Belgium and Austria which are their distribution centers. The company aims at expanding their span operations in the world in continents like Asia and the United States of America. That will enable them to offer a multi-channel retail line across many fascias that would increase the group’s ability to supply their customer with a wide range of sportswear and leisure equipment and other attires that are from the leading brands in the world (Mullin, Hardy, and Sutton, 2014).

  • Brands

The group aims at the brand division that would operate globally, a wholesale and distribution and licensing relationship that can work across the world. They also aim at owning brands that can be managed both centrally and individually in the brand division. That would leverage the expertise of the people and encourage them in innovation that would ensure brands consistency all over the world which is equally important (Davis, 2016). The group also targets at maintaining several UK-focused brands so they can preserve value so that they can be proud to have many high-profile entertainmentss and sporspersonalities. 

  • Premium Lifestyle

From the group’s premium lifestyle division, the group aims at offering a full multi-channel approach that is retail. They aim at offering a wide range of clothing, accessory, and footwear that will be used in sports and entertainment of brands that are leading globally.

E-Commerce Growth

Sports Direct International plc reported a 45 percent increase in online selling accounting for 16 percent of its cumulative retails (Sportsdirectplc.com. 2018). These sales were realized both locally and internationally. Locally being in the United Kingdom where its sales rose by 14.1 percent reaching to £ 990 million while internationally the profits grew up to 15.2 percent representing £ 150.5million by October 2017 (Sportsdirectplc.com. 2018). These means that the online sales still representa significant opportunity ffor the advancement of sales within the company and therefore there need to expand and utilize online sales appropriately.

E-Commerce Proposal Enhancement

Sports Direct has a good customer oriented webpage and user-friendly customer navigation in products browsing. However, there are still improvements to be made that could enhance the marketability of e-commerce. Following suggestions and proposal will be considered good and will enhance Sports Direct e-commerce practice.

Amazing Testimonials:  it has been proven that Potential customers will be more likely to purchase online if there are testimonials from other previous buyers are more as this guarantees them security. Sports Direct international pl’s website should be upgraded to ensure that it includes credible and honest testimonials, and also the name of the individuals are but on the website to create more assurance. These testimonials can be obtained through customer’s email that is after requesting the willing customers to do a review of their experiences regarding shopping with the company.

Instant Chat: upgrading to an instant chat is a modern way of ensuring that a connection is made between the customer and the sales representative of the company. When a customer finds a representative already waiting for them, it is easy for them to remain in the website and if they are searching for something more specific, they can get help rather than just walking away. Instant chats are more efficient as compared to emails, which can take several hours and in the process the customer looking for other options (Singh, 2016). Instant chats are more convenient as they can allow the company to cross-sell or up-sell with ease.

Incentives upon Register: when a website requests the customers to register with them before making the order, they are more likely to experience unfinished orders as compared to those, which do not ask. Majority of the internet and online purchasers are more reluctant to register as members to those particular websites. However, with the help of incentives, the situation could work into Sports Direct favor. When customers are offered discounts during registration that is during the first purchase that will serve as motivation for them to register and consequently make an order. Within no time, more customers will register with the company, and they will keep coming back whenever they want they want to make a purchase.

Implementation and Control

Activity/objectiveJan- June 2018July- Dec 2018Jan- June 2019July- Dec 2019Jan- June 2020July- Dec 2020Jan- June 2021July- Dec 2021Jan- June 2022July- Dec 2021Oct- Dec 2020
Incentives upon Register and instant chats           
International Sport Retail expansion             
Creating a good reputation           
Brands development           
Premium lifestyle           
Complete E-Commerce Growth           

When it comes to implementation and control, Gantt Chart will be used to describe the activities will unfold. According to Mohammad et al. (2016), a Gantt chart is a “visual representation of a project schedule.”

Conclusion

Sports direct international plc is certainly one of the best retails shops that deal with sportswear in the United Kingdom. The company has done tremendously well in the few decades, but it is still necessary to develop strategies to ensure that it can compete in the modern competitive market. Sports direct international plc stores should employ a business strategy that will help it fend off competition from other players in the market. It should concentrate on customer experience and improve the standards of its stores. The company ought to also engage in vigorous marketing for its products to increase its sales. The company should hire competent staff that will push its agenda as per its mission and vision. This will ensure that the company operates professionally, and attracts big sports brands to supply them with their products.

References

(n.d.). Sports Direct International Plc SWOT Analysis. Paul # 011 44 161 238 4056, Datamonitor Plc. http://search.ebscohost.com/direct.asp?db=buh&jid=%22AWTU%22&scope=site.

Alberts, R.W., 2015. The timeous enforcement of trade mark rights. De Jure, 48(1), pp.172-181.

Datamonitor (firm). (2000). Sports Direct International Plc. New York, NY, Datamonitor. http://search.epnet.com/login.aspx?direct=true&db=buh&jid=AWTU.

Davis, L.R., 2016. Swimsuit Issue and Sport, The: Hegemonic Masculinity in Sports Illustrated. SUNY Press.

Farrell, S. (2018). Sports Direct bows to pressure and agrees to independent review. [online] the Guardian. Available at: https://www.theguardian.com/business/2016/sep/20/sports-direct-bows-to-pressure-and-agrees-to-independent-review [Accessed 15 Jan. 2018].

Hoye, R., Smith, A.C., Nicholson, M. and Stewart, B., 2015. Sport management: principles and applications. Routledge.

Mohammad, I., van den Broek, H., Boots, M.L. and Wong, R., Oracle International Corporation, 2016. Showing relationships between tasks in a Gantt chart. U.S. Patent 9,336,502.

Mullin, B.J., Hardy, S. and Sutton, W., 2014. Sport Marketing 4th Edition. Human Kinetics.

Shank, M.D. and Lyberger, M.R., 2014. Sports marketing: A strategic perspective. Routledge.

Singh, A., Li, M., Kavouspour, D., Ebrahimi, F. and Yang, T., Verizon Patent and Licensing Inc., 2016. System and method for providing managed instant communication (or chat)-based helpdesk services. U.S. Patent 9,443,216.

Sportsdirectplc.com. (2018). Home – Sports Direct International plc. [online] Available at: http://www.sportsdirectplc.com/ [Accessed 15 Jan. 2018].