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Liverpool John Moores University
5059BUSBM

Internal Factors of Debenhams Plc
Word count: 2390

Tuesday 23rd April

Contents
1

EXECUTIVE SUMMARY
...
2

3

INTERNAL FACTORS
...
1

RETAIL STRATEGY
...
2

GOODS AND SERVICES OFFERED
...
3

PRICING
...
4

PROMOTIONAL METHODS
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5

OPERATING PROCEDURES
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5
...
5

3
...
2

STORE LAYOUT
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5
...
5

3
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4

CUSTOMER SERVICES AND EMPLOYEES
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5
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6

3
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6

3
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7

3
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7

3
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7

3
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8

3
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1

STRENGTHS
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10
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8

3
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3

OPPORTUNITIES
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10
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9

4

CONCLUSION
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11

Page 1 of 12

1

EXECUTIVE SUMMARY

The internal environment of an organisation refers to events, factors, people, systems,
structures and conditions inside the organisation that are generally under control of
the company
...


2

INTRODUCTION

The internal business environment are factors within the company which impact the
success or failure and approach of operations
...
External factors that affect
the operations of Debenhams are their competitors, changes within the industry,
consumer spending, political, economic, legal, social, environmental and technological
impacts
...
The company originally only operated in a departmental stores format but
has since ventured into online sales (Debenhams, 2019)
...
, 2014)
...
1 Retail strategy
A retail strategy helps to build loyalty and implementation, it considers the market size,
retail sales, people’s income and where people live and explains how the business offer its
products and services
...
There are 4 pillars to this strategy:
×

Focusing on UK retail

×

Delivering a compelling customer proposition

×

Increasing choice and availability through multichannel

×

Expanding the brand internationally

(Debenhams, 2013)
...
Their new strategy prompts a new phase of the
department store where they aim to modernise the company and bring more customers to
the brand (Wightman-Stone, 2018)
...
Whilst we
have made real improvements to our stores and continue to improve our product offering,
we also want to signify overtly to customers that Debenhams is changing and give them
more reason to come in the store – our new brand identity is a way of signalling the change”
(Wightman-Stone, 2018)
...
2 Goods and services offered
Debenhams offer a wide range of products and services across all stores; they carry
product ranges appropriate for the size and location of the store
...
For

Page 3 of 12

Debenhams to deal with eroding market share, they are increasing the amount of exclusive
merchandise they offer and expanding the use of their multi-channel presence (Levy, et al
...


3
...
Debenhams previous CEO Michael Sharp said ‘A number of
changes would help to turnaround profits at Debenhams and improve its business’ (Fashion
United, 2014)
...
Debenhams need to look at their competitors pricing before considering
changing their own as it can damage the brand value of the company
...
Debenhams
always have a sale on or different offers, whereas their competitors only tend to have end
of season sales
...
4 Promotional methods
Retailers use a variety of demand stimulation tools to motivate customers to purchase
(Dunne et al
...
Consumer spending within Debenhams shown a drop-in footfall of
3% from 2017 to 2018 which was the third consecutive annual fall (Elliot, 2019), so
Debenhams use the different promotional methods whether it being, advertising, sales
promotion, personal selling or publicity
...

Direct marketing can target customers through computer technology, which enables
companies to record data, with given permission, this helps when it comes personalised
ads (Cox, et al
...
,
2018)
...
5 Operating procedures
Operating factors that affect sales projections can be either uncontrollable such as the
weather / climate, economic conditions and competitor activities; or can be in the
company’s control, for example, store locations, opening hours, store arrangement and
atmosphere
...
5
...
Whilst we have made real improvements to our stores and continue
to improve our product offering we also want to signify overtly to customers that Debenhams is
changing and give them more reasons to come in store – our new brand identity is a way of
signalling the change” – commented in a press statement (Wightman-Stone, 2018)
...
5
...
, 2014)
Store design provides both utilitarian and hedonic benefits; utilitarian benefits enables customers
to locate and purchase products in an efficient manner, hedonic benefits provide consumers with
an enjoyable shopping experience (Alhilou, 2019)
...


3
...
3

Store atmosphere

Store atmosphere is the physical characteristics of a store that is used to attract customers
...
Retailer must adapt
to the ever-increasing expectations of the customer and their changing tastes and preferences
(Debenhams, 2011)
...


Page 5 of 12

3
...
4

Customer services and employees

Employees are vital to an organisation
...

Traditionally, customer relationship management in retail focused on increasing customers; now,
retailers concentrate on developing customer loyalty and increasing share of wallet, they do so
through use of targeted and personalised merchandise (Alhilou, 2019)
One reason a customer’s leave a store without purchasing an item is due to having no sales help
or sales people being not knowledgeable (Sanders, 2017)
...
5
...
A good location is an asset
and will lead to high levels of sales and hence
...
, 2014)
...

Debenhams operate 182 stores in the UK, Republic of Ireland and Denmark and another 58
stores in 19 countries (Debenhams, 2019)
...
6 Management and leadership
Debenhams employ over 27,000 people globally (Debenhams, 2017) and are committed
to ensuring that colleagues are treated equally -regardless of age, race, gender, sexual
orientation, beliefs, disability (Debenhams, 2017)
...
Debenhams is now under new management yet
still facing implications with consumer confidence falling
...
Leadership style can impact the culture of both employees and
customers, good leaders motivate and inspire others to do well as well as improving overall
internal behaviour
...
Employees are more willing to work sufficiently if
they believe they are valued and cared about, happier employees are often more helpful
and wanting to serve customers
...
7 Social factors
Change in trends and social values impact what a retailer sells and what services they
provide
...
An effective way to attract customers away from competitors is to
offer something not only unique, but something that is missing from the market (Howell,
2018)
...
By offering an experience when visiting a store
whether it being to shop, use services or have a drink it creates an environment where
customers will want to come back (Debenhams, 2019)
...
8 Technological Factors
Online shopping accounted for 18
...

With the growth of online shopping arising over the past few years Debenhams have
embraced the change and went from click and collect to creating their own mobile app
...
However, people are often hesitant to shop online due to
different reasons, fear of fraud, lack of trust in the retailer; a customer may have had
previous issues so is tentative to shop online again, high shipping costs can be a problem
for some, however, Debenhams also offer a click & collect service
...

Recommendations to Debenhams are to save consumer data, with permission, as it will
make future shopping trips easier for consumers, indicate shipping fees, and on their
website, be upfront and clear about delivery options, offer tracking after shipment and state
return policy and privacy policy (Alhilou, 2019)
...
9 Environmental factors
With the rise in knowledge regarding global warming and the impacts have consumers are
more aware and understanding of the factors which contribute to it
...

Debenhams (2017) Annual Report & Accounts say, “We are committed to reducing carbon
footprint and improving the energy efficiency of our buildings and operations”, from 2016 to
2017, Debenhams had a 13% decrease in carbon footprint (Debenhams, 2017)
...
Environmentally friendly packaging which is promoted will
assist in their corporate social responsibility image which may attract consumers
...
10 SWOT Analysis

Swot analyses are commonly used in retail
...
Opportunities are external factors that can enable your
business to do well in the market and threats are beyond controlling ability of the
business that have can potentially put the whole business at threat (Studious Guy,
n
...

3
...
1

Strengths

Strengths addresses questions such as: What value do we bring to the customer? What do we
do well?
Debenhams are experienced in their market and have many loyal customers which makes them
a strong brand
...

International presence provides experience that other competitors may not have and again
creates a wide consumer base
...


3
...
2

Weaknesses

Weaknesses answers questions such as: What isn’t working? Or, what needs improving? Many
retail stores with similar strengths are also present in the market
...
Debenhams have 240 store destinations

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(Debenhams, 2019), a large physical store base means higher cost structure than solely online
competitors such as House of Fraser
...
10
...
Debenhams could introduce
specialist stores such as Debenhams café or Debenhams Beauty rather than following the
common department store model
Introduce loyalty scheme for general customers who don’t want to be a part of the Debenhams
bank but are interested in rewards, Debenhams currently offer a Beauty Club loyalty scheme that
rewards with points which add up for money off (Debenhams, 2019)
...
10
...

Weather conditions impact how a store operates, warm weather for longer means reduced prices
of winter clothing as stores have less time to sell these before new products need to come out
...


4

CONCLUSION

The internal influences on a business include strategy, product, price, leadership,
operating procedures, employees and social, technological and environmental factors
...

Building a sustainable competitive advantage is key to long term financial
performance, there are 3 approaches to doing so – building a strong relationship with
Page 9 of 12

customers; building a strong relationship with suppliers; and achieving efficient internal
operations (Levy et al
...

The Debenhams Redesigned Strategy that began in 2017 has made a huge impact
internally and although Debenhams cannot change external factors like the
environment, use of technology and social factors, they can still be proactive and
embrace changes and are only just starting to do so
...
and Evans, J
...
Retail Management, A Strategic Approach
...

USA: Pearson
...

Berman, B
...
R
...
(2018) Retail Management; A strategic
approach, 13th Edition, Pearson
...
(2019)
...
Available:
https://www
...
co
...
html
...

Cox, R
...
Retailing, An Introduction
...
Harlow: Pearson
...

Davies, G
...
M (1989)
...
London: Paul
Chapman Publishing
...

Debenhams
...
Annual
Report
&
Accounts
2018
...
debenhams
...

Last
accessed 21st April 2019
...
(2018)
...
Available:
https://ir
...
com/static-files/8f1ff5d2-d1cf-4f04-9afe-3549c844716f
...

Debenhams
...
Home
...
debenhams
...
Last accessed 22nd
April 2019
...
(2019)
...
Available: https://ir
...
com/storesown-operated
...

Debenhams
...
About Debenhams
...
Last accessed 22nd April 2019
...
debenhams
...
(2019)
...
Available:
https://www
...
com/business/2019/feb/07/bank-ofengland-holds-interest-rates-cuts-growth-forecast
...

Essential
Retail
...
Debenhams
revamps
store
strategy
...
essentialretail
...

Last
accessed 20th April 2019
...
(2014)
...
Available:
https://fashionunited
...
Last accessed 18th April 2019
...
(Unknown)
...
Available:
https://fleximize
...
Last accessed 20th April 2019
...
(Unknown)
...
Available:
https://smallbusiness
...
com/impact-leadership-style-retail-store-71921
...

Last
accessed 23rd April 2019
Kollewe, J and Butler, S
...
Debenhams profits slump 85% after being bitten by
'beast
from
the
east'
...
theguardian
...
Last accessed 20th April 2019
...
2019
...
Lecture
...
Liverpool John Moores University
...

Alhilou, M
...
Week 6, Retail Image and Own Brands
...
5059BUSBM
...
Delivered: Friday 1st March

Alhilou, M
...
Week 9, Financial Performance and Pricing
...
5059BSUBM
...
Delivered: Friday 29th March
Levy, M
...
A
...
Retailing Management
...
New York:
McGraw-Hill Education
...

Office for National Statistics
...
Internet sales as a percentage of total retail sales
(ratio)
(%)
...
ons
...
uk/businessindustryandtrade/retailindustry/timeseries/j4mc/drsi
...

Sanders, B
...
12 reasons people leave your store without buying
anything
...
bizjournals
...
html
...

Studious
Guy
...
SWOT
Analysis:
Definition,
Importance
&
Advantages
...
com/swot-analysis/
...

Wightman-Stone, D
...
Three UK department stores announce rebrands
...
uk/news/retail/three-uk-department-stores-announcerebrands/2018090438655
...


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