Research A Weakness In A Case Study Sample

99 Cents Only Stores Weaknesses
99 Cents Only Stores is a chain of retail stores located in various States in America majorly selling name branded items at a cheap price of ninety nine cents per item. The stores started as a liquor shop in early 60s but so far, it has incorporated the sales of other consumer products at an affordable price to low income earners as well as provide these items in times during low seasons when they are not easily found in the market. The company has boasted of various success factors including their ability to expand from a family owned store to a series of retail stores which has enabled the company generate recommendable profit in their operations. The stores however, has several weaknesses that affect their performance both to the existing and the new market segments and this paper therefore, addresses some of the weaknesses facing 99 Only Stores in their quest for expansion and achievement of their strategic goals.
The company first has weak marketing skills especially when penetrating new market segments (p. 9). The company depends on pricing strategy as their main marketing tool to attract customers. As seen in the case of Texas market, the retail had not done extensive marketing to make the store known to low income earners in the neighborhood or attract the high income earners who have a believe that cheap products are likely to be of low quality. Instead, the management believes that keeping the stores clean and attractive is the key strategy that will attract the interest of customers to come and shop in the store.
There is also a weak distribution channel whereby the company only depends on their retail stores in selling their products to their customers (p 12). The current market requires a company to vibrant in making their products available to the customers who cannot access the retail stores due to various time factors which mostly involves online selling and home delivery methods. The stores lacks these attributes despite their wide range of customers including even high income earners who are attracted by the low prices offered by the stores. In addition, the company has only 219 stores located in four states as compared to their competitors who have thousand of stores located across the United States.
Another weakness affecting the development of 99 Only Stores is the poor implementation record since the time its early development idea was conceived (p2). The former CEO who was the founder of the store had post phoned the idea of opening new branches to expand the business until the retail market became flooded. This has made the stores have difficulty in conquering market that is dominated by their competitors such as Wal Mart. The primary reason is because; the company takes long time before implementing their ideas which could be reliable if implemented early enough.
Poor product quality is another weakness affecting the expected sales trend in the company. The goods that are sold in the company are bought from other companies’ inventory remains or goods that have been produced and do not meet customer demands (p2, 3). These have even affected the sale of other products sold in the retail shops even if they are of recommended quality and raised negative speculations from the customers whereby they prefer to buy similar products at a high cost as they believe they are of better quality.
The company has experience difficulties in their sales due to the weak market superstition created by the customers’ believe that cheap products are of low quality. This has caused the company to experience high relative cost due to low sales and increasing operations expenses (p 17). Internal operating problems between the management and the employees have also affected the operations of the stores hence leading to reduced profits. The internal conflicts has caused key employees such as the auditor to resign (p 15), contributes to low profits as this affect the internal control and operations of the stores.
The retail industry is the fastest growing industry and as a survival strategy, 99 Cents Only Stores need to come up with new strategies that incorporate the marketing mix and competitive strategies so as to overcome their weaknesses. Despite their strong capital management, the company needs to come with strategic plans that aim at strengthening their market as well as counter the existing competition from the leading retail stores.