Business Case Study: Mr Price Group Limited

Executive Summary

Mr Price Group Limited has a series of different divisions. Ranging from home ware, sportswear and apparel. Apparel is how Mr Price Group Limited was initially started and it continues to be the leading sales category, with a 59% sale split. The goal of Mr Price was initially, and still is to “Offer on-trend and differentiated merchandise at exceptional value to ladies, men and children.”

In order to keep doing so Mr Price has to keep this division relevant and be on the same level or ahead of competitors, included in this business report is the Porters Five Force Model, a SWOT analysis and a PESTLE analysis. These can be used to analyse the challenges of the Micro, Market and Macro environments.

Background of Mr Price Group

In 1998 Mr Price Group Limited launched the Mr Price Home. In 2000 Mr Price Group Limited expanded its stores outside of South Africa, to Botswana and Namibia. In 2005 Mr Price reached the amazing achievement of selling over 100 million units. Two years after that Mr Price Sport was launched. In 2008 Mr Price was not only voted “the most loved and most frequented apparel brand” but Mr Price Home was voted “the most loved and most frequented homeware retailer.” Since that huge accomplishment Mr Price has launched more African stores, launched an online store, and has launched two more division MrPMobile and MrPInsurance. As of 2009 Mr Price runs 954 stores in South Africa and 17 stores in Africa and the Middle

 Customer goodwill may be lost if they have to go to competitors.

 Transport issues may occur- leading to a loss in profits

Power of Buyers:

Buyers can be final customers, or intermediaries. If a business sells directly to the final buyer it is important for them to know who their target market is and what they desire. If the desires or needs are not met, the buyer will not be satisfied and will turn to alternatives. This translates to the business having a financial loss.

Impact on the business:

 Plays the biggest role on the business

 Price sensitivity – in some instances buyers may be happy to pay more for a product or service if it is delivered, has a guarantee or is conveniently available etc.

Strategy:

 Mr Price will have to do extensive market research to insure maximum sales

PESTLE Analysis

A PESTLE Analysis is a tool used by companies to scan the macro environment. It gives the business a broad view of the external environment where they do not have any control or influence. It is important for the business to know what is happening in this environment so that they can adapt to any changes.