Why Is John Lewis Successful

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International Marketing Introduction John Lewis is a well-known high-quality British chain of department stores, with 43 shops established throughout Great Britain. John Lewis employ 90,000 staff members, who are all also partners within the company. At the end of every financial year all workers are entitled to a ‘bonus’ which is a percentage of the company’s annual gross sales. Globalization has allowed John Lewis to offer international shopping and deliveries of a limited amount of small products to 33 countries across the world. Brazil is one country that is missing from the exports list. As brazil has a population of 201.03 million people, which is more than 3 times more than the UK population which currently stands at 63.9million.…show more content…
One problem that John Lewis might have is that they lose control of their business concept because it’s run by licensees that weren’t previously a part of the business. The return they get on the licensing won’t be spectacular either because the licensing fees won’t be a large sum of money. Franchising would be a better option of entry mode for John Lewis as they would be in charge of supplying the franchisee with their company ‘package’ that they must use and follow to set up the business e.g. McDonalds sell franchises in order to have every McDonalds the same worldwide. Selling a franchise can be costly as John Lewis would have to carefully create a package and find a suitable franchisee to implement it, this part could be time consuming and expensive, but in the long-run could also bring in great returns as they could get a quick development in the market as the franchisees will already know and understand how to deal within that market. By expanding the company through franchises, John Lewis could benefit from economies of scale, as the business grows they can bulk buy materials and goods to save money whilst reaching out to more people as well. The best market entry mode for John Lewis to adopt whilst moving into Brazil…show more content…
If they expand they will benefit economies of scale which in turn will reduce their costs and make the business more efficient, which is what they are aiming for. John Lewis should try to target to a large market from 15-65 year olds by being competitively priced and promoted. By concentrating on the 7P’s (Product, Place, price, promotion, people, process, physical environment) they can place themselves in the Brazilian market as they have done in the UK. Appendix A John Lewis Pestle Political • Globalization can be both challenging and beneficial to John Lewis. Because of globalization, countries of the world can easily exchange their goods around the world, meaning that there will be more competitors. These competitors might even have better products than John Lewis and be threatening to the company. • The benefits of globalization on John Lewis is that they’re able to sell and deliver their products around the globe without any barriers, this makes it easier for them to establish themselves in other countries. • The corporation tax in the UK is currently 26% for companies that earn over £300,000 in profits. In 2014 John Lewis earned £10.2bn in profits (before paying out the partnership bonuses to the employees, tax and exceptional item)

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