Operating strategy: Current Strategies and Future Implications o The functional layout of the Bed Bath & Beyond stores allows for convenient navigation through the 11 specialty stores within each superstore. The racetrack layout showcas

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Executive Summary

Strategic Analysis:

* Business strategy: Bed Bath & Beyond's boutique superstore strategy of offering an extensive product line and superior customer service translates into a customer-friendly shopping experience at a store with a variety of quality products at reasonable prices.

o This is an effective strategy because customers can get everything in one place, while private label merchandise allows them to get a discount instead of having to pay a premium for the convenience.

o Also, although the size of the BBBY stores could easily create an impersonal environment, the company is making a conscious effort to design their stores and policies around the needs of the customer.

o Currently, BBBY has built a higher margin business and they need to be careful that in their future growth they do not sacrifice these margins to price wars.

* Operating strategy: Current Strategies and Future Implications

o The functional layout of the Bed Bath & Beyond stores allows for convenient navigation through the 11 "specialty stores" within each superstore. The "racetrack" layout showcases the merchandise and makes locating a particular product easier.

o Local responsiveness is one of BBBY's strengths. This strength comes in part from the policy of allowing local managers to determine the appropriate product mix to best fit the local market tastes.

o On the whole, management is one area BBBY needs to pay attention to as it expands. With BBBY's rapid growth, the demand for entrepreneurial, charismatic, trained and experienced managers might outstrip the supply to fulfill the current "promotion from within" policy. It will most likely become necessary for BBBY to look externally for qualified managers with other retail experience, which could lead to a dilution of the BBBY culture. Seasoned BBBY managers might need to be temporarily sent to new stores to help maintain a consistent store culture. Eventually, as more BBBY start to cluster in regions, the company should consider adding regional managers to supervise multiple stores in one region. This would create another layer of management to fill the gap between the founders and store managers.
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o In terms of advertising, if BBBY wants to increase same-store-sales as well as new-store-sales, the company will have to increase their advertising from just word of mouth and flyers with coupons. And as competition increases, BBBY could fall behind if it does not invest in advertising and promotion to distinguish itself.

* Growth strategy: BBBY is only operating in 12 states, and the market is certainly not yet satiated. There are definite continued expansion possibilities

o Again, flexibility of store size to fit the local market is to BBBY's advantage.

o Even with ...

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