Superdry, Essay Example

Superdry is a branding company dealing in clothes, accessories, and footwear. The company takes pride in its quality and unique designs that are a perfect fit for all of its consumers. Through the company’s commitment, innovation, and excellent customer service, it has been able to produce and sell products that beat competition yet affordable. The company has managed to address the concerns of its clients by engaging them, paying attention to the details provided, and being flexible in the design and production phase. Customer satisfaction led to an increase in customer retention and customer base.

The company employs several marketing strategies such as having a flexible and a variety of trading channels, and the use of technology to find sources, design, market, and sell its products. The company constantly assesses the skills and capabilities of its employees as well as the partners, and the expectations of the customers. Understanding the trends assist the company in ensuring its relevance and its ability to deliver. The company does not hesitate to grasp opportunities when a particular untapped market is established.

The wide customer base is seen in the many locations the company has been able to set up shop. Superdry penetrated the branded fashion industry especially in Eastern Europe, Northern America, and parts of Asia. The company is domiciled in over 40 countries with a cumulative number of 516 stores and 18 websites. The company credits the wide customer base to research on the shopping patterns of customers and having multiple trading channels to enhance the customer experience. The business approach should be tailored to the culture and development stage of the region and inform decisions regarding the trading channels and marketing strategies to be used.  Before the company sets up shop in a particular location, an assessment is done to determine the potential risks and benefits to come up with appropriate strategies.

The history of a business is important in defining the organizational design and culture of a company (Maclean, 2017, 457). The origin of Superdry goes way back to 1985 when Julian Dunkerton founders Cult Clothing with help from a former business partner. The first store was in Cheltenham and later grew to most of the towns hosting Universities with great demand. Seventeen years later, a collaboration was made between Julian Dunkerton of Cult Clothing and James Holder of Bench Branch to form the Superdry brand though under the Cult Clothing company. The next year, a third partner was introduced, Theo Karpathios. More collaborations were made to drive the brand farther, for example, the Benelux franchise and the CNC collections. In 2014, the company opened shops in Spain, Germany, and other European countries as part of the region’s economic growth strategy. With time and efforts, the company grew and built its reputation in Europe and even internationally with purchases from over 150 countries and even got featured on the London Stock Exchange.

The vision of the company needs to be very clear and all actions driven towards its achievement (Bloomberg, 2020, 130). Superdry has the vision to be the leading brand in the fashion industry providing quality clothing with a unique design. Superdry envisions itself embracing e-commerce more and being more innovative. The company’s mission is to make Superdry a creative and product-centered brand that encourages and provides its consumers with the contemporary fashion style. To achieve this, the company works on its goals and objectives with the core values in mind during the business operation.

An excellent company believes in transparency with its employees and customers among other core values (Bloomberg, 2020, 130) as depicted from the Superdry care labels namely; individuality, family, passion, fun, creativation, and quality. The company values the input of all and regards the stakeholders, partners, employees, and customers as one family. The team is passionate about this business and also have enjoyed doing it. Besides, the company promotes creativity, innovation,  and ensures delivery of quality unique brands. The company encourages teamwork, an excellent organizational culture, and expertise to guarantee financial growth through various platforms such as the digital platform for trading.

The company has been able to be consistent in its delivery of quality and unique brands and this has been facilitated through in-depth research. Superdry assessed the behaviors, attitude, and style of various age groups and cultures and concluded on nine groups of consumers with four types of rules. The research will enable the company to makes informed choices concerning the business approach. For a product to appeal to the customer, the product needs to be tailored to their style and needs. The customer needs to be engaged to provide their suggestions in design or deals. For instance, Superdry gives a feminine touch to the ladies wear and gifts customers in some circumstances.

The company is steering towards a new direction from applying a design-centered approach to the current customer-centered approach, as commented by the interim Chief Executive. The company has plans to orient itself back to the original Superdry that was very profitable, highly reputable, and with a wide loyal customer base. To achieve this, the original strategy is used with the company is maximizing its opportunities to cut irrelevant costs in the operations, job redundancies. The employees are working tirelessly in the labs with various trials to innovate products that are cost-effective and that promote the brand.

Superdry Market Value is high as depicted in the market value graph that stands at 111 m euros according to the London stock exchange. The revenue with EBIT margins has been steadily increasing with a record operating revenue of 1,023,512 Euros and the revenues before interest, taxes, depreciation, and amortization increasing to 185 compared to 130 of last year. The profit margin has also improved from 7.38 in 2018 to 9.68 in 2019. The returns on equity employed increased to 32.76 compared to that of 15.99 in the previous year. The returns on capital employed also show the value of capital with that of 23.03 compared to 14.07 of the year 2018. The company has a total amount of 593,340 euros as assets with returns on assets showing the value of the company assets with an amount of -16.69 compared to 10.63 in the previous year (Supedry, 2020, 1). All these measures indicate a highly profitable, effective, and valuable company. However, the gross margin has dropped from 58.6 in 2018 to 56.1 in 2019 and a drop in EBIT of 7.73 from 7.76 of 2018.

According to the revenue capture model, a valuable business has a high productivity rate that increases its operating margin (Karlson, 2015, 338). There has been drastic improvement in the amount of revenue and profits the 2010 to 2019 turnover rising from 200,000 Euros to the current approximately 1 million euros.

A valuable company captures all opportunities to increase revenue according to the revenue capture model (Karlson, 2015, 230). E-commerce is key in ensuring the business creates and captures opportunities for itself such as targeting customers or in trading  (Karlson, 2015, 255). The company maximizes its digital platforms to improve the business, to link customers to stores using the “Click and Collect” or the “Ikiosk” and to link the stores to those who want wholesale prices through the ”Zallando” (Superdry, 2020, 1).

All stakeholders in the supply chain should be involved in ensuring a profitable business that economizes its resources in all their transactions (Di Maio, 2017, 163). The company has succeeded in involving all the stakeholders such as the consumers, partners, suppliers, colleagues, and even the community. Superdry company has also been able to create and capture value by creating quality and unique designs that beat the competition. The company has also managed to have a wide customer base and captured their loyalty.

The concept of Corporate social responsibility creates a balance in the economic versus environmental sustainability in the company business operations and products. The company ensures it is running a responsible business by creating a positive impact on the communities surrounding and the environment while at the same time growing financially.

The corporate social responsibility strategy needs to be affected in all the business operations and along the supply chain for it to her to have a positive and sustainable impact (Ranängen, 2017, 15. The stakeholders under the social responsibility strategy in the company include business partners, suppliers, colleagues, the community, and the local and state authorities.

The corporate social responsibility strategy needs to be purposeful, with further stakeholders engaged and their needs and demands prioritized for its efficacy (Dal Maso, 2018, 322). The company has managed to prioritize the needs and demands of its stakeholders by identifying and addressing them as soon as possible. Social responsibility by the company is very important hence the prioritization of the strategy about the stakeholders. There are swift decision making and action implementation with previous mistakes in mind. For instance, there was a degree of urgency in the implementation of the modern slavery policy.

According to the stakeholder theory, the active engagement of the stakeholders allows good decision making regarding the proper risk assessment and disaster management strategies (Mojtahedi, 2017, 35). The company continually monitors and adjusts its policies and assesses risk, creates awareness by training employees and partners.

The company ensures corporate social responsibility addresses the needs and demands of all its stakeholders through the following policies and objectives.

The company also ensures that while designing, producing, and selling its products, the process promotes environmental sustainability. The products created by Superdry are of integrity and this gives the customers confidence when purchasing them.

The company respects all workers along the supply chain despite the position and input into the company. Superdry also ensures that the welfare of its employees is taken care of in terms of living and working conditions with equal rights. Besides, the company has a charity program run by employees to take care of their needs when necessary.

The company takes up on opportunities to support the communities that the company and employees interact with along the supply chain. The company has participated in charity programs or community support groups such as the Superdry 360. The prince’s trust is a charity program that takes care of the unemployed youth and the disadvantaged in the community such as the mentally ill and the disabled. The company has donated funds and some of its products. Through the Cheltenham design festivals, the company provides free education, focus group discussions, job shadowing, career fairs, internships expert advice/feedback as well as reading materials and resources. the company also donates to care international to take care of the company itself and its purpose of providing to the poor.

All business operations should abide by the standards and legislation of the local and international authorities (LeBaron, 2017, 15) such as the production stage, the recruitment process, and the health and safety of the workers. The company runs all its businesses from tier 1, 2, and 3 as per the ethics by respecting human rights and condemning slavery and human trafficking during the business operations or along the supply chain as dictated by the modern slavery policy. The company employs the; ethical trading code of practice as per the international standards; the migrant and contract worker policy and guidelines that protect the recruitment accommodation and communication capacity of the workers; and the subcontractor policy that monitors the standards and mapping of the supply base. These policies are constantly under development, adjustments, and oversight.

In the event of an actual or suspected breach of the modern slavery policy, the factories and the victims are relegated to the collaboration of the government, non-governmental organizations, other brands, and the company partners. The company reports the issued to the local authorities end Poppins and investigation identification and prosecution of those that breached the policy or were accomplices.

The company ensure resource sustainability through the sustainable development goals of climate action and ensuring there’s clean and affordable energy. The company’s environmental policy dictates that all business operations should ensure there is a reduction in the emission of greenhouse gases. There is also less water consumption in the production stage. The company reduces energy consumption by minimizing electricity use for lighting and air conditioning and also monitoring the controlled metering. The company reduces waste generation by recycling waste from textiles or reusing them for car insulation and cleaning purposes and minimizes land use by limiting the company’s physical size to the required minimum. The company has the vision to use and produce products that are a hundred percent Cotton and the company has already started on this mission of ensuring the supply chain has organic processes.

The strengths of the company are being able to achieve a number of its targets from the previous to the next financial year. The company was able to extend the migrant worker assessment, the monitoring program the gender empowerment assessment and review, and the factory resiliency and ethical training to India and Turkey. The company was able to re-launch these programs and also the seeking approval and ethical training program and due diligence process in factories in South East Asia and China. Nonetheless, the weaknesses of the company are that gender empowerment, the due diligence process, and the global risk assessment has not been achieved in other factories.

By taking the course I have gained knowledge of various theories such as organizational theory, the stakeholder theory, and the revenue recapture model. I have become knowledgeable about various key concepts in the running of a company such as corporate social responsibility and the importance of having a common vision and mission and running other companies under its core values to attain its goals and objectives. I have also learned the importance of a company being consistent, having a clear direction, and operating within ethical standards.

I have learned and how the company exercises shoulder responsibility by taking care of the environment, its employees, and the communities surrounding it. With the example of Superdry, I have learned that a company should not only focus on making profits but also on other factors that will eventually affect the business.

I have been able to gain an understanding of various frameworks applied in businesses such as financial reporting and financial measurements such as return on equity, return on capital employed, return on assets and the interpretation of the profitability and efficiency of a company.

However, I encountered several challenges especially in analyzing the financial report and relating it to the current status of the company. I was able to overcome the challenges by taking examples such as the Superdry financial reports and using it to learn the concepts and frameworks used. The continuous practice has enabled me to gain skills and techniques to do a financial analysis of companies.

References

Bloomberg, J., 2020. Organisational theory: Management and leadership analysis. Sage. pp. 130-210.

Dal Maso, L., Mazzi, F., Soscia, M. and Terzani, S., 2018. The moderating role of stakeholder management and societal characteristics in the relationship between corporate environmental and financial performance. Journal of environmental management, 218, pp.322-332.

Di Maio, F., Rem, P.C., Baldé, K. and Polder, M., 2017. Measuring resource efficiency and circular economy: A market value approach. Resources, Conservation and Recycling, 122, pp.163-171.

Fjeldstad, Ø.D., and Snow, C.C., 2018. Business models and organization design. Long Range Planning, 51(1), pp.32-39.

Karlson, L. C., 2015. Corporate value creations: An operations framework for non-financial managers. John Wiley and sons. pp. 230-340.

LeBaron, G. and Rühmkorf, A., 2017. Steering CSR through home state regulation: A comparison of the impact of the UK bribery act and modern slavery act on global supply chain governance. Global Policy, 8, pp.15-28.

Maclean, M., Harvey, C. and Clegg, S.R., 2017. Organization theory in business and management history: Present status and future prospects. Business History Review, 91(3), pp.457-481.

Mojtahedi, M. and Oo, B.L., 2017. Critical attributes for proactive engagement of stakeholders in disaster risk management. International Journal of Disaster Risk Reduction, 21, pp.35-43.

Ranängen, H., 2017. Stakeholder management theory meets CSR practice in Swedish mining. Mineral Economics, 30(1), pp.15-29.