贝恩Bain-零售行业分析课件

bcCompiler:Reviewer:RetailCo.Created:August26,1999SevaRozanovThomasShannonRetailCo212可编辑BackgroundApproachConclusionImplementationResultsAgenda3可编辑

RetailCois$10+B“specialityretail”conglomeratewhosefinancialperformancehasdeterioratedsince1990Background4可编辑Achievetopquartileperformancemarket/bookvalue:2.8xreturnonequity:17-18%annualearningsgrowth:10-12%DivestbusinessesthatarepoorfitsPreparethecompanytoweatherchallengingindustryconditionsCreateacompellingvisionandgrowthstrategyFinancialObjectivesStrategicObjectivesBackgroundRetailCoObjectives5可编辑AgendaBackgroundApproachConclusionImplementationResults6可编辑Approach7可编辑ComponentsofSuccessfulStrategyDoable:EvolvesfromcurrentbusinessmixFitsRetailCo’scorecompetenciesIsfundableDevelopssignificantcompetitiveadvantagesCapitalizesonthevolatilityofretailcyclesUnderstandable:CommunicatesaclearandcompellingapproachtothebusinessWillbefullyvaluedbyanalystsandshareholdersDesirable:Createscleareconomicvalueandtop-quartilefinancialresultsbuildsaportfolioofhigh-potentialbusinessesmakesbusinessunitsmorevaluabletoRetailCothantoothersAvoidexcessivelayers,overheads,anddecisionprocessesIsattractivetokeymanagersintargetedbusinessesandfunctionsApproach8可编辑

MarketsizeMarketgrowthSegmentreturnsSegmentprofitabilitytrendsCompetitiveintensitySupplierpowerSegmentstabilityMarketAttractivenessMarketshareMarketsharetrendGeographiccoverageCurrentprofitability/EVAEarningstrendManagementteamRetailbrandequityInfrastructureandsystemsCustomervaluepropositionStrategicPositionCorporateexperience,skills,

andvaluesCorporatefunctionalsupportCorporateportfoliodevelopmentCross-divisionalsharingFitRetailCobusinesseswereevaluatedalongthreegroupsofcriteriaApproachRevisingtheMixofBusinesses9可编辑FactBaseHowstructurallyattractiveisthismarket

segment?(projected)industrysizeindustrygrowthindustryprofitabilitycompetitiveintensitybuyerconcentration/powersupplierconcentration/powercommittedcapitalrequirementsstageinmarketevolutionacquisitionopportunitiesHowdoesthestockmarketvaluethissegment?industryvolatilitymarketvaluationmultipleandtimingvaluetransparencytostockmarketDowehaveastrongpositiontoday?marketshare(local/regional)marketsharegrowthtrendsprofitabilityrelativecostpositionbrandequityconditionofassetsDowehavethekeysuccessfactorstoachieveastrongpositiontomorrow?

(orcanweacquire/buildthem)functionalprocesscapabilitiescoststructurenewproduct/conceptdevelopmenthumanresources/peopleskillscapitalresourcesHowdoesthisbusinessfitwithotherRetailCodivisionsandcapabilities?cashflowgenerations/requirementscommonfunctionalprocessescommoncustomerprofileslinkagetocentralresourcesuniquepeopleskillsThefivequestionsapproachwasusedtobuildfactbaseoneverybusinessofRetailCoApproach10可编辑AgendaBackgroundApproachConclusionImplementationResults11可编辑BusinessUnitEvaluations(1of2)

DivisionConclusionStrategicPositionMarketAttractivenessFitNorthLargemarketreadyforconsolidation,goodprofitability,verystrongpositionHollandLargepotentialmarketwithopportunitytoboostgrowthandprofitabilitythroughacquisitionsandimprovedoperatingefficiencyItalyRapidlygrowingchannelwithhighreturns.NeedtoinvesttocapturemarketshareandimproveoperatingefficiencyHongKongLargeoverallmarketwithslowgrowth.CashprovidercapableoffundinggrowthbusinessesLuxembourgReevaluategrowthplans.EconomiesofscalenotyetachievedbutsegmentextremelyprofitableConclusion12可编辑BusinessUnitEvaluations(2of2)

BritainModeratesizesegmentwithgoodprofitabilitybutstrongcompetition;decliningmarketshare,lowrelativeoperatingmarginsIrelandDecliningmarketsegment,poorposition,littleopportunityforsale,potentialforsavingsbyfoldingintoHongKongFranceOvercapacityinsegment,losingmarketshare,belowaverageprofitabilitySwedenLargeoverallmarketbutrequiressubstantialinvestmenttodevelopnewproductsandachievescaletoimprovecostposition;businesshaspoorfitwithRetailCoskillsSpainSmallsegment,lowgrowth,highvolatility,andseasonalityDivisionConclusionStrategicPositionMarketAttractivenessFitConclusion13可编辑BusinessUnitRecommendations

DivisionStrategicPositionMarketAttractivenessFitGrow

(SpinOff)North*

Holland

Italy

HongKong

Luxembourg

Hold

Britain

Divest

Ireland

France

Sweden

Spain

*SpinOffConclusion14可编辑StrategicAlternatives

Long-termvision:Corporateprofile:TheleaderinselectedbusinesslineschaindrugapparelfootwearhometoysBusinesslinecompetenciesCostandexperiencesharinginthegroupsAcquisitionstoachievebusinesslinedominanceGroup-basedorganisationAbalancedportfolioofspecialityretailersResourceallocationcompetenciesLeancorporatestructureDecentralisedmanagementGrowandkeepsuccessfulbusinesses.DivesttheunsuccessfulAleadingdeveloperoftargetedgrowth-stageretailersSelectionandexpansioncompetenciesCorporateexpertiseincriticalgrowthfunctionsbusinessdevelopment

(R&Dandresearch)realestatesystemslogisticsCostandexperiencesharinginkeyactivitiesacrossallbusinessesAcquireandgrowpromisingconcepts.Divestwhenvalue-addedpeaksConclusionGroupSpecialistRetailConglomeratesGrowth-stagegreenhouse

(RetailCo.“Classic”)15可编辑RevisethemixofbusinessesintheportfolioallowNorthtopursueanindependentstrategysellFrance,SpainandSwedenattherightpriceandtimeEnsureremainingbusinessesaddressthemostimportantstrategicissuesestablishclearstrategiesforgrowthbusinesses

(Holland,Luxembourg,HongKong,Italy)finaliseturnaroundplansforbusinesseswhichcan'tbe

soldatreasonablepricestakewrite-offsasrequiredConsideracquisitionsReducecorporateexpensesAddvaluetothebusinessesintheportfoliobuildR&DcapabilitiesleveragecostsupgradetheorganisationConclusionActionRecommendations16可编辑Chaindrugindustryisconsolidatingeconomiesofscaleinsystemsinvestmentsrelationshipswiththird-partypayersAnindependentNorthgeneratessignificantlymoreshareholdervalueasitparticipatesintheevolutionoftheindustryNorthmakesminimaluseofcorporatefunctions;thereislittlecost-sharingamongNorthandtheotherdivisionsMarkettimingisattractiveNorth'svalueisnotbeingfullyrecognizedinthemarketplaceConclusionExample:RationaleForanIndependentNorth17可编辑ConclusionExample:RationalefortheSaleofFrance18可编辑IfthesaleofFrancetakeslongerthananticipated,severalactionswillbetakentoimproveFrance'sperformance:ConclusionExample:France-StrategicImperatives19可编辑Vision:FinancialGoals:ToreachandmaintainROIClevelsof20%Togrowsalesby5%peryearandnetearningsby10%peryear1998salesobjective:$1,225MM1998netearningsobjective:$47MMStrategySummary(1of2)Conclusion20可编辑KeyImperativesInitiativesDevelopournewconcept,WidgetFactory,intothesecond-largestnon-mallbasedwidgetretailerRetailCoRealEstateauditofpotentialnewsitesWidgetFactoryrapiddeploymentinitiative(openingof30newstoresperyearClosenon-performingstoresClosingofthe10worstperformingmaturestores(bothXYZandWidgetFactory)eachyearImprovemarginsbychangingmixandreducingcostsMixchangebasedonGMROIapproachImplementationof4-WallssystemRedesignoflogisticsflowbasedonRetailCostudyImprovedensityofmarketsbybackfilllingfivemarketsModifyourimageintheeyesofthecustomerAssortmentredesignbasedondemandandprofitabilitySalesforcetraininginitiativeoncustomerserviceLaunchofanewadvertisingcampaignFocusnewstoresinSoutherngeographiesAcquireandintegrateSouthernWidgetbyendof1996RetailCoRealEstateauditofpotentialnewsitesProposedpartnershipwithSouthernMalls,Inc.StrategySummary(2of2)Conclusion21可编辑ConclusionCriteriaforAcquisition22可编辑CorporateCostReductionOpportunities

*ExcludinginterestConclusion23可编辑

PrimaryLevers:CorporateRoles:CorporateportfoliodevelopmentKeepawareofmarketandcustomertrendsdrivingpotentialopportunitiesDevelopcriteriaforscreeningacquisitionsandpartnershipsoralliancesIdentifyandevaluatenewconceptsandconsolidationopportunitiesDevelopanetworkofdealcontactsStructure,negotiateandclosedealsCoordinateeffectiveintegrationplanningEvaluateopportunitiestospin-off/exitbusinessesFinancialcontrolsDefineprimarymeasuresoffinancialperformanceSetspecificfinancialreturnandearningsgrowthtargetsDevelopfinancialplanningandcontrolsystemsAllocatecapitalandotherresourcesBusinessoversightDefinemanagementdecision-makingprocessesCoachdivisionalmanagementfocusmanagersonmeasurableresultsquestionassumptionsandchallengethinkingProvideleadershiponcriticalissues(e.g.,divisionstrategy,valuedisciplines,andpriorityandresourceconflicts)IdentifyopportunitiestoimproveoperationsandsetspecificimprovementgoalsPrimaryLeversAvailabletoAddValue(1of2)Conclusion24可编辑

PrimaryLevers:CorporateRoles:ExpertisesharingandoperationalimprovementInstillcompanywidecommitmenttospreadingbestpracticescoordinateregularexperiencesharingatalllevelsfacilitatecommunicationamongdivisionsandfunctionsDrivevaluedisciplinestoimproveoperationsacrossallprocesses,functionsanddivisionsProvideleadershipandexpertisetosupportimprovementsinperformanceManagementallocationanddevelopmentAttract,motivateandretainthebestmanagementrecruittoptiercandidatesrewardbasedonperformancepromotebasedonabilityProvidestrong,profit-relatedincentiveslinkedtocorporateobjectivesRotatemanagersacrossfunctionsanddivisionsDevelopformaltrainingprogramsStrategydevelopmentPerformanalysistosupportstrategicdecision-making(corporateanddivisional)DefinecorporatestrategicdirectionAssessmarketattractiveness,performance,positionandfitofdivisionsworkwithdivisionstobuildhigh-quality,fact-basedstrategicplansIntegratedivisionplanswithcorporatestrategyCentralservices

andinfrastructuresharingProvidescaleservicesandfunctionstoachievelowercostandhigherqualityLeverageinfrastructureacrossbusinessesPrimaryLeversAvailabletoAddValue(2of2)Conclusion25可编辑ProjectedEarnings

NorthNewRetailCo*FromMonteCarloanalysisNote:EarningsequalsnetincomeaftertaxesandinterestConclusion26可编辑*With$300MMsharerepurchaseGapvs.SBPProjectionsGapvs.RealisticROEtarget:ROE*:(Gap)/surplus:11.1%12.0%$10.8MM15.9%19.2%$35.6MM17.0%21.6%$61.3MM11.1%9.4%($22.4MM)15.9%13.4%($28.6MM)17.0%14.9%($30.2MM)ConclusionGapAnalysis27可编辑AgendaBackgroundApproachConclusionImplementationResults28可编辑CorporateGovernanceThedecisionsoftheBoardwillbeevaluatedunderthetraditionalbusinessjudgementrulestandardThedistributionofNorthshouldnotrequireshareholderapprovalthedistributionisadividendwhichrequiresonlyboardapprovalAT&TprecedentThepotentialdivestituresshouldnotbeconsideredasaleofsubstantiallyallofRetailCoremainingassetsNewRetailCowillbeasubstantialentitywithestimatedsalesof$4.2B,netincomeofapproximately$119,andassetsof$2.1BImplementation29可编辑Note:DistributeNorthstockdividendatappropriatetime3Q954Q951Q962Q963Q964Q961997ApproveallcomponentsofStrategicReviewCloseFrancetransactionCloseSpaintransactionCloseSwedentransactionReorganizeCorporateoffi