Issues in Global Business Burberry 2012 Essay Example | Topics and Well Written Essays - 2000 words

Issues in Global Business Burberry 2012 - Essay ExampleSmall per centum of the study discusses the impact of Profit before Tax on strategic buyback decision of Burberry. The smart set needs to expand their global franchise act in order to decrease value chain cost. The study impart focus on globalization strategy of Burberry Group plc in terms of retail distribution network. Report shows that engage control strategy of the fraternity will help them to push total market capitalization in near future. mark matrix structure of Procter and Gamble has been recommended for future fruit Burberry Group. Hybrid matrix diagram will help the company to set up strategic vexation units in Asia and Latin America. Table of Contents Table of Contents 3 Case Statement 4 Strategy abbreviation 5 Financial location 5 Leverage Control 6 International Growth Strategy 8 SWOT Analysis 8 Porters Five Forces Analysis 9 Strategic Theme 11 Conclusion 11 Recommendation 12 Reference 14 Burberry Burberr y Group plc is a renowned global lavishness brand. The company is headquartered at London, England. Burberry Group plc was established by Thomas Burberry in the division 1856. The brand specializes in offering apparel and leather goods. Burberry Group plc offers products by means of modify distribution network complemented by retail channel, wholesale, licensing channel and digital platform. The company has achieved a total revenue growth of 7% in the category 2011. Burberry has created a digital platform named as Burberry World Live in order to enhance their web visibility. Intraday market capitalization of the London based company is $5.3 billion while they maintain a profit margin of 12.1 % on category sales (Yahoo Finance, 2012). Case Statement Burberry Group plc has recently announced that they will directly operate in cup of tea and fragrance category. The company has no plan to continue license relationship with their partner Interparfums SA. Fragrance and beauty has be en reason as fifth product division for Burberry Group. The other four categories are accessories, women apparel, men apparel and children apparel. Angela Ahrendts (Chief Executive Officer of Burberry Group plc) has stated that they took the decision of direct control in order to achieve greater control over product portfolio of fragrance and beauty category. The CEO believes that the company has significant opportunities to drive growth from fragrance and beauty products and the move will also leverage infrastructure & upward integration of value chain. Direct operation of the company for fragrance and beauty categories will start from 1 April 2013. Burberry Group took the decision for following strategic objectives. Achieving greater brand control Increase penetration in opening impairment point categories The company will pay all total Euro 181 million for ending license relationship and ?71m of total amount will be use for recognising exceptional items The London based company will earn a adjusted profit before tax or PBT in financial year 2013/14 and from FY 2014/15 the PBT will accelerate Retail and wholesale contribute 90% of total business for the company hence they will design diversified retail channels for their fifth product category (Burberry Group plc, 2012) Strategy Analysis Burberry has purchased the perfumes selling license from Interparfums SA by paying ?142m. Stock analysts believe that the company is pushing harder in the perfume and cosmetic segment in order to