Gap Inc. In 2010: Is The Turnaround Strategy Working?

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Gap Inc. in 2010: Is the Turnaround Strategy Working?

Family Clothing Store Industry
Internal Analysis

BUS800 - 101

Tuesday, February 10th, 2015

Internal Analysis Requirements:
1. Financial analysis (2 pages max). Conduct a thorough financial analysis. Details on what to include in your financial analysis can be found at the end of this document (begins on page 6).
2. How well is the company’s present strategy working (quantitative and qualitative analysis)? a. Identify Company’s Vision, Mission, Objectives (financial and strategic)
b. Identify company’s competitive approach (business and functional strategies)
c. Identify and analyze key performance indicators (will include indicators for both financial and strategic objectives; financial results should include a summary of relevant facts from your financial analysis)
3. Is the company able to seize market opportunities and nullify external threats (SWOT analysis)?5 4. Are the company’s cost structure and customer value proposition competitive (Value
Chain analysis)?
5. Is the company competitively stronger or weaker than key rivals (Representative weighted Competitive Strength Assessment)?
6. Identify “one” strategic issue you think merits front-burner managerial attention. The issues shoud be framed in a question format (How to…, What to do about ….., and
Whether to …. – see the second to last paragraph on page 132 of the text). Make sure you only identify one strategic issue. While there very well be more issues that deserve managerial attention the focus of your report is going to be based on supporting only the one issue you identified.
7. Identify all of the relevant facts from your appendix that led you to conclude that the issue you identified deserves managerial attention. List these facts in this section by including the relevant reference from your appendix. You only have to use the numbered heading like (1.1). Every fact that you feel is related to supporting your issue choice should be identified. This is simply a mapping exercise. This section will ultimately become an outline for the analysis section of your report. Your analysis section of the report should include text that would ultimately result in referenicng each of the facts identified in this section of the appendix.

3. Is the company able to seize market opportunities and nullify external threats (SWOT analysis)? Strengths
Expanding brand in foreign markets (p.167)
Leader in most number of stores in the industry (p. 167)
Socially responsible (p. 168-169)
Leading e-commerce websites in the retail industry (p. 164)
Decline in Sales (p. 156)
Diminishing market share within the U.S family clothing stores industry.(p. 161)
Not keeping up with latest fashion trends (p. 168)
Outsourcing to low cost manufacturing (p. 158)
Continuing their franchise expansion (p.169)
Growth of ecommerce sales (p. 161)
Implementations of sophisticated software infrastructure (p. 167)
Online Integration of Gap’s five brands using a single shopping cart (p. 158)
Quality control (p. 160)
Declining economy (p. 155)
Aggressive competition (p.161)
Supplier risk associated with oversea government policy and natural disaster affecting productions. (p.158)

From the SWOT analyses above, Gap have shown that is continuing to do well in regards to their strengths. Their current expansion into new markets have been doing well, which creates more opportunity for Gap to grow their brand presence by expanding their franchises to regions they have never been exposed to before. Also, by leading as a great example and being ranked the number one most socially responsible company among retailers (p.168), it have an amazing impact on the image on the company, allowing Gap to leverage their image in order to attract more customers that are conscious towards a better community where everyone is treated equally. With the massive investment towards the infrastructure of