Dollar tree is a modern accessories selling business. The company manages stores that cross over 40 locations and sell assortments starting from kitchen ware to office supplies. In addition the company is also involved in food, candy, health and beauty and season and occasion supplies. A recent change to the discount variety stores is an announcement of Stephanie Stahl as the newly appointed independent director to the company’s board as at January 2018 (Dollar Tree Info, 2018). Recent financial standings for the company indicated that its diluted earnings per share have increased 221.3% and a consolidated earnings increase of about 12% (Dollar Tree, 2018). The company’s strategic position at the moment seems on a relatively positive trend.
Miles and Snow typology involving four distinct areas of company strategy place Dollar Tree at the Analyzers category (Barney & Griffin, 1992). The company is comprised of different stores offering different products for everyday use. In this way, the company constantly identifies the needs that people might be having and potential innovative ways to curb the already established market. Diversification of products is also evidence of analyzer strategy where the company introduces user accounts to make transactions and ordering easy. A third way the analyzer strategy has been used is through the company’s website design. The website expresses diversity for all types of users including businesses and investors.
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Companies operating in a similar market are bound to have similar business models. The similarity in business models creates the idea of strategic groups. The strategic groups contribute to the globalization of a sector through the sharing of characteristics. Dollar Tree could be put into the TESCO, ASDA and MORRISON strategic group (Marion, Heimforth and Bailey, 1991). The listed consist of retail businesses with similar combination of strategies. The strategic groups are created on the basis of products and services offered as well as pricing. In essence, the retail industry is different from the restaurant industry that is also divided into Fast food and fine dining. Consequently, the inherent division into time, pricing and presentation is clear (Rhodes & Amel, 2008). However, different companies become unique by maintaining their own principles and core foundation values (Budayan, 2008). In the same way, companies also consider the strategic groups they are in in order to plan expansion and marketing strategies accordingly.
Dollar Tree is operating in an industry that requires efficiency and customer satisfaction to thrive. Efficiency in operation and logistics ensures that stock and deliveries are sufficiently addressed (Bentler & Chou, 1987). In this way, the customers are encouraged to deal with the business owing to the extent of satisfaction they receive and the quality of service. Acquiring significant customer loyalty is one way the company can help maintain its market position (Capon, Farley & Hoenig, 1990). Mobile phone applications and real time deliveries will significantly increase competitive advantage because of the ease in buying and receiving products.
In conclusion, Dollar Tree should consider taking up a defensive strategy plan in order to secure the established market and to establish long term loyalty. Loyalty seems to be the result of customer satisfaction and efficient logistics and operation.
References
Amel. D. F., Rhoades. S. A. (1988). Strategic groups in banking. The Review of Economic and Statistics, 70(4), 685-689.
Barney.J.B & Griffin. R.G. (1992). The management of organizations: Strategy, structure, behavior. New York: Houghton Mifflin Publishers.
Benter. P. M., Chou. C. P. (1987). Practical issues in structural modeling. Sociological methods Research, 16(1), 78-117.
Budayan. C. (2008). Strategic group analysis: Strategic perspective, differentiation and performance in construction. Middle East Technical University Press.
Capon. N., Farley. J. U. & Hoenig. S. (1990). Determinants of financial performance: A meta-analysis. Management Science, 36(10), 1143-1159.
Dollar Tree.(2018). www.dollartree.com
Dollar Tree Info. (2018). www.dollartreeinfo.com
Marion. B. W., Heimforth. K., Bailey Wiltse. (1991). Strategic groups, competition and retail food prices. University of Wisconsin Press.
