Vera Bradley Business Model

This type of business model that focuses on women accessories has witness a successful growth in recent years. Companies that adopted this type of business model have registered strong comparable sales growth numbers. The company has attracted investors by combining with the expansion of the store base, thus, showing a strong market base growth, which translates to huge sales of their products. However, this type of business model has recently experienced a great deal of pressure that results from online competition, subdued consumer spending due to hard economic times, and poor traffic trends. Moreover, this type of business model has been affected by the fiscal policy that has resulted to its poor sales over the recent years leading to low profits.

The placement of its products in several outlets such as malls, stores, and retail shops besides magazine ads have made the company’s products popular. The company send special offers such as 20% discount for its members for their next purchases, a coupon. Moreover, it also allows members to get a sneak peek at their own colors. The company also sends monthly booklets to their previous customers that shows off some of their products through personalized emails, thus, creating a sense of familiarity and association. The company has resorted into expanding its outlet stores across the United States besides availing its products to other smaller bouquet type stores located in several parts of the world. However, if the company deliberate on adopting a strong IT system it will save on operational cost as well as enhancing flexibility besides promoting a scalable operating structure.

For instance e-commerce will enhance the company’s marketing approach and will require less human resource, thus, saving on the operational cost. What degree of opportunity or threat do each of these two factors create? Explain what the impact (positive or negative) might be on the business. Economic factors Vera Bradley should contemplate on using the country’s economic factors such as inflation, consumer spending, industry’s economic indicators like textile- accessories and apparel footwear industry rate of growth, and economic growth rate, which will enable it to forecast the growth trajectory of both the organization and its industrial sector. This will only come about after the company has looked into the following factors in the PESTEL analysis. Which industry force has the biggest impact on the future of the success of this company? Describe the impact it has.

Vera Bradley has lately received a stiff competition from its chief rivals such as Coach, Inc. , Michael Kors holding, and Kate Spade & company. These companies have developed strategies that will enable them to remain relevant in the ever changing consumer market for luxury product brands, thus driving down the prices of products due to the availability of multiple luxury products in the market. This aspect serves to decrease the overall profitability of the Textile-Apparel Footwear & accessories industry. The company’s new and unique strategic plan is a rare resource since it cannot be accessed by the competitors. This will help the firm to compete with its chief rivals in the production of unique products in the market. Vera Bradley’s unique strategic plans have been adopted to help the company in developing unique luxurious product assortment by focusing on its core designs besides utilizing a tightly integrated multichannel distribution strategy that includes all departments and retailers of the company’s products.