Martha Stewart Discussion Questions
1. What are the external factors impacting Macy’s in the retailing business and Martha Stewart Living Omnimedia? Macy’s philosophy is to have as many unique brands as possible, adding to the customer experience and shareholder value. Macy’s has exclusive contracts with Tommy Hilfiger, Sean John, Rachel Ray, and Martha Stewart, this allows Macy’s to be unique in the retail space. The external factors MSLO and Macy’s deal with are the same as many other companies, such as; competition, social, legal, economic and technological changes. Strategic goals and objectives are the two external factors that led to the lawsuit between these two companies. The executives at Macy’s and Martha Stewart experienced a break down in communications as well as their relationship that led to the law suit filed by Macy’s against Martha Stewart. I was surprised Martha Stewart didn’t understand the exclusivity Macy’s wanted with the product line. From a legal stand point, the only way Martha Stewart could have the contract voided is if Macy’s wasn’t fulfilling their end of the contract from a sales standpoint. After reading this paper we can only assume Macy’s was meeting or exceeding the performance objectives outlined in the contract. The lawyer’s working for Martha Stewart should have been savvy enough to advise against signing a contract with J.C. Penney that violated Macy’s exclusivity clause.
2. Does Macy’s have the right resources and capabilities for their current strategy? Why or why not? Macy’s does have the right resources and capabilities for their current strategies outlined in the paper, but they are also a part of the retail space and retail has a long history of being sluggish and cyclical at times. The August 13, 2014 Bizjournals.com site has a report of Macy’s operating income being 571 million or 9.1% of sales. The second quarter of 2014 produced 6.27 billion in sales, up 3.3 percent from 2nd quarter...
References: 1. http://www.bizjournals.com/cincinnati/news/2014/08/13/macy-s-profit-rises-but-misses-wall-street-s.html
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