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Transcript of BSG Presentation
Kim Alvarado B Company B Company Lessons Learned Andy Vazquez
Kim Alvarado Our strategic vision for B Company is to create a culture of innovation, creativity, and diversity to improve the quality and accessibility of footwear globally via our competencies and resources, new technologies, and more in order to gain a competitive advantage, a desirable market positioning, and ultimately increasing shareholder value to become the benchmark in the footwear industry. Strategic Vision Maximize Production Ability
Maintain Low Rejection Rate by investing in
Best Practice Training Programs & TQM/Six-Sigma programs
Offer High Compensation Incentives for Employees Production Strategy
Compensation Strategy 1. Stick to the same strategy throughout the entire game.
2. Adapt to change and do not assume the industry will remain consistent every year.
3. Some debt is good.
4. Stay in focus. Do not be greedy and arrogant Earnings Per Share: YR 18 @ $11-12 YR 19 @ $13-14 Performance Targets
for the Next Two Years Initially, we aimed for a best-cost strategy hoping for a low-cost and high star quality shoe, but as the years progressed our strategy converted to low-cost strategy focusing less on differentiated footwear (quality) and more on lower costs.
Global Strategy Competitive Strategy
Branded Label Company B Strongest Competitors Improve S/Q Rating
Better utilize Celebrity Appeal
Offer better Rebates
Invest in More Retail Outlets
Continue to offer Free Shipping Leave Other Companies Behind YR 10-17 Dividend Strategy: Finance Strategy Financial & Strategic Performance ROE Investment: YR 18 @ 22-25% & YR19 @ 26-30% Credit Rating: Maintain A+ Image Rating: Maintain above 75 Global Market Share: Stock Price: Increase to $175.00 by YR 19 Debt vs Equity: Ever year we paid our loans and did not pursue any other financial opportunities
Stock Issued/Repurchases: Repurchased as much stock financially allowed, but never raised additional equity capital by issuing new shares of stock
Credit Rating: Maintained an "A" average credit rating by maintaining healthy debt-to-asset ratio, interest coverage ratio, and default risk ratio
Dividend Strategy: Our company overlooked a dividend strategy, causing our inability to efficiently maximize our financial opportunities Competitive Strategy
Private Label From Year Eleven to Year Seventeen our company maintained a low-cost strategy placing minimal emphasis on star quality. Finance Strategy YR 18-19 Dividend Strategy: To incorporate dividends for the following years we would:
Increase dividends by $0.50- 0.80 cents for year eighteen and
Increase dividends by $1.00-1.10 for year nineteen Corresponding with our EPS, we would increase to:
$11-12 by year eighteen
$13-14 by year nineteen Bid Price: 26.00
S/Q Rating: 5
Pairs Offered: 366
Pairs Sold: 366
Market Share: 44.9% Company E Bid Price: 40.00
S/Q Rating: 6
Pairs Offered: 450
Pairs Sold: 450
Market Share 55.1% Private Label in North America (YR 17) Branded Label in North America (YR 17) Company B Company E Internet Wholesale 12.0% 12..9% Market Share 15.0% 11.6% Company A 20.5 % 24.0% Acquire 1/4 of the market Total Annual Revenues EPS ROE Credit Rating Stock Price Image Rating Global Market Share Global Unit Sales Steps to Success....