Signet Jewelers is the largest international retailer dealing with diamond jewelry. The success of the business is affected by various factors influencing the operations of companies in the global market. Political factors play a significant role in transforming the operations of Signet Jewelers in different countries. There are various political systems risks, and Signet Jewelers is required to analyze the market of the countries they are operating. Some of these political factors are political stability which determines peace in the nation, necessary for the business operations. The level of corruption such as regulation levels in the service sector is essential to decide whether or not it is worth for the business establishment. The anti-trust laws related to jewelry stores have to be learned. The economic factors necessary to be aware of are the inflation and interest rates, levels of skills in the jewelry stores business cycle and the efficiency of the financial markets. Economic factors are global affaection every segment of the economy.
International social factors that affect the business operations of Signet Jewelers are the class, hierarchy and power structure in the society. The culture of the people is important such as the social conventions and gender roles which will determine if the jewelry will be consumed. The attitudes of the nations which will be involved such as environmentally conscious are necessary since they will determine the consumption levels (Department). The entrepreneurial spirit, as well as the broader nature of the society, affects businesses. There are some societies which will support the operations of Signet Jewelers while others do not. Signet Jewelers has to ensure that the country they chose to conduct business in supports their products and appreciates them so that productivity is possible.
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Technology affects companies at the international levels. The most competitive companies have adopted technology advances. Signet Jewelers has been conducting research on the existing technologies related to their business and have adopted some approaches which have helped in creating a competitive advantage. Technology has been used in improving customer service. When the customers are satisfied, they become loyal to Signet Jewelers, thus maintaining its position as the largest jewellery company in the world. Technology has impacted the cost structure of Signet Jewelers by creating improvements on their operations thus improving the profitability of the company. Value chain structure in the service sector has improved. Signet Jewelers can conduct their operations online thus being able to reach a larger target market. Customer response has also been enabled through the use of the internet.
The international environmental factors that Signet Jewelers should consider are the water and air pollution regulations which Signet Jewelers should look out for in every company. The company should adhere to the pollution regulations to avoid any business implications. Weather and climate change are essential to consider since they determine the transport of the jewels to the customers. Signet Jewelers has to consider recycling regulations as a way of ensuring that they maintain the cleanliness of the society they are operating it (Department). The legal environment will affect Signet Jewelers operations. Intellectual property laws, patent and copyright laws in every nation the company will conduct their business. The employment laws, Signet Jewelers, have to ensure that the labor they acquire is compensated depending on the national laws. The production process has to ensure that health and safety laws are maintained for Signet Jewelers operations.
According to the first quarter financial results of Signet Jewelers in the fiscal year 2019, the financial position of the company has fallen in comparison to 2018. The operating income in the first quarterly has been 22.1 million dollars, in comparison to 2018, which was 76.9 million dollars. The large decrease with 71.3 % has been due to the selling the prime accounts receivables on the third quarter of the fiscal year 2018. The result was earning of less interest income from a low receivable portfolio. The loss in the first quarter, which was 38.8 % or 574.2 million of the sales in comparison to the previous first quarter, was caused by the various factors. The first one was impairment from the intangible and goodwill charge of 448.7 million dollars. The second reason was a loss of 143.1 million dollars in relation to marking the marking the non-prime receivables at a fair value after reclassification was done (Jewelers, 2017)). The third factor was the cost of the transformation plan known as Path to Brilliance, which cost 6.5 million dollars. The fourth reason was losing 69 million dollars to the expense of higher bad debt and finance charge income. These declines in the revenues of Signet Jewelers led to the transformation of the cost saving.
Signet Jewelers did not check on the factors in the international market that would affect their operations. It resulted in a loss, in comparison to the fiscal year 2018. Signet Jewelers may be the largest jewelry company in the world but without being careful on factors that affect their operations, it will not only their productivity but expansion as well.
References
Department, S. M. (n.d.). Signet Jewelers Limited PESTEL Analysis & Environment Analysis. Retrieved October 18, 2018, from http://fernfortuniversity.com/term-papers/pestel/nyse4/3147-signet-jewelers-limited.php
Jewelers, S. (2017). Signet Jewelers Reports First Quarter Fiscal 2019 Financial Results. Retrieved October 18, 2018, from https://www.signetjewelers.com/investors/news-releases/news-release-details/2018/Signet-Jewelers-Reports-First-Quarter-Fiscal-2019-Financial-Results/default.aspx
