Final Payless Presentation
- 1. GNS Consulting: Payless ShoeSource By: Elizabeth George, Natalie Neal & Shirley Sanchez
- 2. Executive Summary Founded in 1956 by Louis and Shaoi Pozes Based in Topeka, Kansas In October 1997, the first international Payless store opened in the Toronto area. By 2000 they expanded to a total of 236 international stores Payless Shoe Commercial
- 3. Executive Summary Owned by Collective brands, which also owns Sperry, Stride Rite, and Keds. Currently Payless has over 4,000 stores Payless has had to close over 400 stores to help cut costs for their struggling business Stock has dropped from $24 to $12 within the past year
- 4. SWOT Strengths Weaknesses •4,500 stores nationwide •Disorganized stores •Use of designer collaborative •Hard to find merchandise products •Limited product assortment •Payless’s variety of products •Lack of motivation from their •Inexpensive footwear employees Opportunities •Opportunity to dominate the Threats •Competitors such as, Wal-Mart, value-priced shoe segment Target, Kmart, Sears, Kohl’s and •Collaborations give Payless an J.C. Penney edge • Brand image has caused them to •Improving their market share, close 475 stores and report a loss, brand image and positioning within which mainly reflects the declining the consumers’ mind. of value in Payless stores
- 5. Competitor Analysis Brown Shoe Company: In business for 130 years. Their claim, “To inspire people to feel good and live better… feet first” DSW, Inc.: Began in 1991 and are a leading footwear brand and accessories retailer that offers a wide selection of brand name designer footwear and accessories for men, women and children. Operates 319 stores in 39 states. The company’s core focus, “is to create a distinctive shopping experience that satisfies both the rational and emotional shopping needs
- 6. Competitor Analysis Target Corp.: Opened first store in 1962 . Their mission is to, “make Target the preferred shopping destination for our guests by delivering outstanding value, continuous innovation and an exceptional guest experience…” J.C. Penney Inc.: one of the top retailers in America and have over 1,100 stores throughout the United States and Puerto Rico. Their vision is to be “America’s shopping destination for discovering great styles at compelling prices”
- 7. Problem #1: Inefficient Sourcing The company runs mainly out of one central distribution center in Topeka, Kansas, which has started to create a decline in the company’s ability to stay on top of trends (Cullin, 2007). Strategies: Modernize the Distribution Center: Equipment-based & Modernize the Distribution Center: Process-based Objective 1: To invest in distribution efficiency by the end of the fiscal 2012 year with the goal of decreasing unnecessary spending by five percent a year through 2017
- 8. Smart Cart
- 11. Problem #1: Inefficient Sourcing The company runs mainly out of one central distribution center in Topeka, Kansas, which has started to create a decline in the company’s ability to stay on top of trends (Cullin, 2007). Strategies: Give distribution employees incentives to respond quickly to regional store’s inventory needs. To better understand employee happiness versus employee motivation and implement a distribution environment that will encourage efficiency. Objective 2: To reallocate the five percent savings on spending in the first objective by the end of 2013, and distribute the savings among distribution center employees as an incentive program.
- 12. Problem #2: A broad, underperforming brand portfolio Currently, Payless needs to examine and consolidate their large brand portfolio to decrease fixed distribution and factory costs associated with owning this large number of brands, which will eventually result in an increase in profits. Strategies: To consolidate underperforming brands in the Payless portfolio Objective 2: As an attempt to decrease licensing costs and increase efficiency, Payless will undergo a strategic portfolio review and consolidate underperforming brands by the end of the 2012 fiscal year.
- 13. Problem #2: A broad, underperforming brand portfolio Currently, Payless needs to examine and consolidate their large brand portfolio to decrease fixed distribution and factory costs associated with owning this large number of brands, which will eventually result in an increase in profits. Strategies: To define a position in the market for each brand to create value in different categories amid the footwear industry. Objective 2: Realign Payless’ portfolio based on the current industry trends and analysts’ research to determine a market for each brand.
- 14. Evaluation # 1 Goal is to decrease unnecessary spending by 5% Payless should be able to increase their response to industry trends Payless should be able to distribute the savings among distribution center employees as an incentive program A way to measure the success of the employees’ incentive program is by evaluating the performance of their employees
- 15. Evaluation # 2 The first objective is to tailor the list of brands Second objective is to realign the portfolio based on Payless’ current market position and analysts’ research To measure this strategy, profit levels will be compared from previous years The company will notice a decrease in fixed distribution and factory costs Payless will address and solve problems quicker and easier
- 16. Conclusion Payless has over 4,000 stores with a presence in the United States, South America, Canada and Central America Payless has the opportunity to dominate the value-priced shoe segment They will have to attract and retain consumers by providing faster distribution of fashionable shoes and building a relationship with its consumer base
- 17. Conclusion The idea is to rebuild the Payless name of, “democratizing fashion and design in footwear and accessories to the world and inspiring fun fashion possibilities for the family” (Payless Shoesource, 2011)
- 18. Check this out! Bush and Payless
- 19. Questions? Comments? Thank You for your attention!
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