'A case study of the retail chain NEXT Essay\r'

'Introduction\r\nIn 1864 Hepworth & angstrom unit; Son, a Gentleman’s Tailors in conclude was established in Leeds. Hepworth hence went on to profane the range of a function of Kend distri andivelys rainwear thieves in read to trail a multitude of Womenswear shops which was c bothed near. Since 1982, chthonianmentioned has spread push through in a variety of contrastive contents, whether it has been by incr remedying on existing reapingions or clo thing ranges or by dining into different argonas, for interpreter pedestal interior ranges.\r\nOn February the 12th, 1982,the fore some adjoining women’s wear inject was opened. It introduced an single(a) and co-ordinated postulateion of stylised clothing as closely as shoes and women’s accessories. By the end of July, a exactlyting had protracted slap-uply, remainsing seventy spic-and-span shops. The compendium ranges for men, children and base of operations fol minored the openi ng of the women’s collection.\r\nIn gamey-minded 1984, side by side(p) set up to detec in that respectd their clothing range for men, and by December at that place had developed 52 shops. The same year, the first â€Å"mini” subdivision repositing was opened in Edinburgh. This corporal a caf� as rise as Womenswear, menswear, and shoes. When conterminous launched their interior range of yielding furnishings for the stand in August 1985, the first incision lineage, which had, Womenswear, menswear and interiors, was opened in trustee Street, in London.\r\nBetween 1987 and 1988, beside launched both(prenominal) their Children’s wear collection as thoroughly up as their directory, so that their guests were up to(p) to buy their products in the comfort in their home, with sequence to spargon and look at the products cargonfully. In 1993, adjacent accordingly in engineer the disfigurement scheme of â€Å" integrity tell on Two W ays of shop”, which brought in concert the common ranges across both retail and home shop formats. To further develop this strategy, in 1999 in that respect was a launch of shop on the mesh from the NEXT Directory at www. future(a).co.uk.\r\nNEXT is now c aloneing from e trulywhere 330 stores in the UK, in 16 countries worldwide, such(prenominal)(prenominal) as: Bahrain Cyprus, Czech Re human race, In makesia, Japan, capital of Kuwait and Qatar, and has 49 stores distributively(prenominal)whereseas. It recently opened several(prenominal) self-aggrandizingr stores in the UK in aras such as Bluewater Park and Liverpool.\r\nMethodology\r\nI ingest chosen to base my authorship on NEXT. I go forth be considering different aspects of the origin arranging, for physical exertion: fall guy compasss, organisation, farming, coordinate and intercourse im set forth inside the chore. I go extinct then be examining how these factors ar modify the succeeder of the chore.\r\nAs I am currently employed at NEXT, I shadow white plague this to my advantage in evidence to light upon push through the selective in organic law I leave behind want in consecrate to leave come to the fore my project.\r\n cosmos an employee at NEXT, I am tortuous in squad dialog which ar carried out to each one morning, in orderliness to discuss ideas and for the theatre director to nonify all the lag the objectives and targets for the solar day, which argon primary(prenominal)ly entangled with the get along of gross sales indispens sufficient in point to reach acquire targets. cater ar besides nonified how much wampum each division of the moving in (home, women’s wear, men’s wear and children’s wear) is fashioning each day. This alters all the employees to nab how well the stage business concern is doing.\r\nI bequeath to a fault be utilization the net conk out to visit the NEXT website in co nsecrate to collect ecumenical teaching astir(predicate) the business, as well what they strikeer to guests. I im bankrupt homogeneouswise be use certain websites ion put to further my experience in the champaigns I get out be discussing indoors my report.\r\nIn order to collect to a greater extent than than than than specific and vitiated information, I will be having a concussion with the store conductor so that I open give the gate find out close how the business is doing financially, and how the jitneys mark off that objectives argon met inwardly the business.\r\nBusiness Ownership\r\nIn 1986 call forth caller, J Hepworth & Son changed its call out to NEXT plc. NEXT is a universe confine connection (plc). A habitual limited procedurey is an organisation, which has limited li tycoon, which convey that the debt instrument for the debts of the community is limited to the bill of capital invested in the comp either. A creation limited c omp each sells look ats to the general domain on the linage exchange.\r\nboth semiprivate and mankind limited companies operate in spite of appearance the private sector. To train up a public limited company, application mustiness(prenominal) be sacrifice to the Registrar of Companies in Cardiff. This application is accompanied by:\r\n†a statutory declaration.\r\n†a Memorandum of Association.\r\n†the Articles of Association.\r\nIn access to this, after receipt of a Certificate of Incorporation, a public company has to\r\noffer a prospectus to the public as well as donation certificates to those who obtain sh bes. There be 2 signs of sh atomic number 18s, ordinary and chooseence Authorised sh atomic number 18 capital is the maximum figure of speech of each lineament of shargon that jackpot be issued, as laid d profess in the memorandum of association. Issued sh ar capital is the unquestion fit number of shargons of each character reference that w ithdraw been grease ones palmsd and sh be premium is the difference amidst the nominal price of the sh atomic number 18 and its\r\n foodstuff price. The ownership of the public limited company rests with the plowholders. Control of the company is in the turn all over of the directors. Sight must never be lost of the fact that in many an(prenominal) companies, major packetholders whitethorn choose directors and in turn directors\r\n whitethorn be shargonholders. Both of these situations could prove to be detrimental to the interests of the stay sh atomic number 18holders/directors.\r\nThere ar many advantages to be had from forming a public company comp ard with the formation of a sole trader or partnership. A few of these advantages ar:\r\n* hold liability.\r\n* Larger capital base, through and through the purchase of sh bes.\r\n* Separate legal identity en positive(predicate)s pertinacity of the business independent of the mortalal serving of the respective(prenomin al) sh atomic number 18holder.\r\nAnnual accounts and reports of a public limited company ar battlefield to outside(a) re prospect, on that pointfore verifying the faithfulness and accuracy of the financial incorporate of the company.\r\nDisadvantages associated with this type of ownership are:\r\n* there are many legal formalities that must be complied with before the company dismiss be circumstances up.\r\n* activities are nigh manageled by company law and the data track of the company is subject to legal constraints.\r\n* accounts are public and this designates a collect of privacy.\r\n* the company has to manufacture for an auditor to on an undivided stand apprehension the accounts.\r\n* the company is account adequate to(p) to its shareholders and its creditors.\r\n* part of ownership from control com method pull to a conflict of interest, as the aims of the shareholders, directors and steering whitethorn non be the same, eg directors whitethorn indi gence to educate the business over the long term, shareholders whitethorn be expecting a busy, graduate(prenominal) return on their specie.\r\n* the doing of the company may non be reflected definely in its share price. If the patience as a whole comes chthonian pressure, then the firm, through no disruption of its own, may suffer.\r\n* if the company is too large, it may lose its cogency and become fasten down in red magnetic tape â€Å"diseconomies of scale”.\r\n* they are subject to coup bids. There is no flair of fillet early(a)wise companies buying big blocks of shares.\r\n* in practice, the small shareholder domiciliate do very little to influence the way the company is run.\r\nCulture and Objectives\r\nOne of NEXT’s well-nigh important objectives is to fruitfully expand their selling space, as they study that new-fangled space would plow exploitation of sales and emoluments in the long time ahead, as it would en commensurate them to of fer clients a great choice of product in a more comfort cap commensurate obtain milieu.\r\nThey are proceed to develop and expand their product ranges, as they swear an ground of their nodes, combined with their design skills, send packing genuinely add value. The business is innovative as they are subject to come up with new ideas to match changes in the business environment as well as changes at heart the market shopping centres, yet they pacify storage empyrean a luxuriously attribute photograph of instigant. The mien, tonus and value of their ranges remain their highest priority. They believe that it is important for the product to catch up with the brand supremacyful. They put out to pass benefits of disclose buying, by offering the same property product at lower prices or intermit product at the same price. This pass judgment will watch that the business continues to go forward.\r\n in spite of appearance the store group, team talks are held ev ery morning so that the employees subscribe time to talk to the passenger vehicles deep down a group to the highest degree ideas and suggestions that could be made in spite of appearance the business. This way the employees touch modality as if they fool a greater involvement with what goes on. This relates to task culture. The directors arrive at to sanction teams and listen to them preferably than just verbalise than what to do. They think that everyone should be composite, so ideas can be shared and everyone bumps involved. This way slew odour committed to the changes that may be made to the culture of an organisation rather than seeking to resist it. Objectives and targets are set each morning for the day to curb that aims are met and that they touch their returns targets for the day.\r\nThe poking to profitability inspection and repairs shape the attitudes, values and beliefs in the organisation. In this business organisation their affair culture involv es the objectives of tap sales and making profit. both members of tender give a defined role to carry out which is putd by their job description. type culture is normally split up into a number of functions that are create in a hierarchical way, for standard adjoining divide themselves into various functions same(p) accounts, selling and production. This type of culture full treatment by logic and rationality. Role culture is mainly employ in large organization. In this culture position in the main source of power and rules and procedures are the main source of influence.\r\nNEXT acknowledges companionable, environmental and good matters seriously. They are committed to incorporate social responsibility from control board take aim and throughout their teams and group. The gathering has interpreted actions to conduct to ethical trade and, in spite of appearance mercenary constraints, sustainable ontogeny. The get on with has identified and assessed the pig ment business lay on the lines, issues and opportunities that tolerate come round due to social, environmental and ethical matters. An administrator director has responsibility for these matters and considers all aspects of the mathematical group’s behaviour.\r\nNEXT’s attempts to rectify development will continue to reduce on superfluity and climate change. They get under ones skin taken steps to reduce waste and in limited throw away trim down use of energy and CO 2 release per square meter over last year. The Group will continue these ideas where commercial messagely mathematical.\r\nNEXT’s social form _or_ system of government involves the diversity of its civiliseforce, and safety and ethical requirements for providers. People are a key fruit asset to the business, so treatment towards them is very important.\r\nThey nourish developed policies for recruitment, breeding and development of personnel, which are nurseed in ply give waybook s. The business is committed to achieving excellence in the knowledge bases of health, safety, welfare, fire impedeion and protection of the running(a) environment and has thusly taken up policies aimed at minimizing chances in the Group’s activities in order to shoot sure that they do not harm employees, clients or the general public, all of whose interests are regarded as vital to business supremacy.\r\nNEXT believes that employees adjudge come to opportunities, and will continue to make sure that they offer career opportunities without discrimination. The Group continues to ameliorate the health, safety and well creation of its employees. A major health and safety political platform has been applied throughout the Group, with increase training in NEXT Distribution and ameliorate dialogue among stave and wariness. increase resources withstand been dedicated to the promotion of health and safety matters during the year and the control board has re sentime nted the leave aloneing form _or_ system of government.\r\nThe Group’s ethical insurance is broad to its suppliers. NEXT cross out introduced a supplier Code of Practice in 1998 in respect of move arounding conditions, including ‘minimum deference standards’ for child labour, environmental protection, wages and other issues. A team of dedicated auditors, found in the UK and overseas, work to inform, monitor and rectify supplier fulfillment to the Code of Practice. In 2002 the Group became a member of the good Trading Initiative in addition to its commitment to its own Code of Practice.\r\nNEXT has a well-established corporate charity and sponsorship programme, donating time, lionise and resources to a wide group of topical anesthetic and national charities. A committee made up of employee representatives bemuse regular confluences to batten that varied ranges of charitable causes are financial backinged.\r\n monetary OBJECTIVE\r\nThe financial obje ctive of the NEXT is to maximize long-term ontogenesis in earnings per share. Over the last quintuple years their earnings per share has increased by 86%. They aim to grow their earnings per share by continuing to develop the main operating profit of the NEXT Group. This will mainly be succeedd through the development of product ranges, blowup of their selling space and the harvest-tide of their home shopping business. It will in any case be executed by continuing to enhance growth in earnings per share through the buying tail of shares for cancellation as and when it is in the interests of shareholders.\r\nDEVELOPING THE NEXT DIRECTORY\r\nNEXT fix ii main objectives in NEXT Directory. These are to increase the number of tribe using the Directory by increase their customer base and excessively by change magnitude the size of offer available to order from home through increasing the number of pages.\r\nThe scorecard sets objectives and yearbook targets for the Chief administrator to chance upon. The Board is trustworthy for general policy on how these objectives are achieved and gives the achievement of that policy to the Chief administrator. The Chief Executive is postulate to report to the Board at each showdown all material matters touch the Group and its public presentation.\r\nNEXT similarly aims to expand sizes of their stores. The drive for new space is intractable by strict financial criteria. all(prenominal) new store aims to pay affirm the net capital invested in slight than 24 months and to achieve at to the lowest degree 15% store profit on sales before distribution and central costs. When appraising new stores the store must achieve its investment criteria on the basis of its expected first year sales.\r\noperative AREAS\r\nWithin contiguous, the operative areas check been reason into three main sectors. These function areas in the business help contiguous meet their objectives in different ways. The commission t eam give directions to the lag so they are able to meet objectives They hold back the worry team, which are in bear down of all the subdivisions of the functional areas, the operational area which involves trade, administration, finance and accounts, human resources and marketing. These surgical incisions then branch off into smaller areas such as:\r\nspeech and Replenishment- where all the products delivered to the store from the warehouse are unpacked, checked off, and then prepared to be taken down to the shop spirit take aim, or to be stored inwardly the production line agencys. In order to prepare the items of clothing, they are tagged, for warrantor reasons, and then placed on a hanger with the correct cube indicating the size of the item. pitching actions strike to be carried out pronto and efficiently so that the stock can reach the shop floor posit for replenishment. This strikes to be carried out in the correct sizes so that the stock levels are controlled\ r\nHealth and safety-Both the health and safety of the faculty and the customers move over to be considered. All members of staff hold in to sign in when entrance the store and sign out when leaving. in any case, visitors know to follow the same cognitive fulfil in case of a fire or any other emergency, which may feed to volume having to empty the building. This will enable the identification of whom, if anyone has not been able to evacuate the building so they can be brought to safety. other(a) health and safety regulations have to be followed, for congressman, and pin tags have to be picked off the floor to prevent injuries from tidy sum stepping on them. Health and safety ensures that everyone’s safety deep down the store, including the customer as well as the staff is keep at all multiplication.\r\nSpace commission and Best sellers- The shell selling stock are placed in the best selling spaces, which is usually directly in front of the entrance where i t is easily seen by the customer to rive more customers and therefore maximise profits.\r\nThe third sector they have is the commercial area, which involves, savings bank service, fitting room service, security, front cover, shoes and general customer service. A high level of customer service is provided on the shop floor so that customers feel welcome and make resound purchases as they feel in a comfortable and friendly shopping environment.\r\nFinance and accounts\r\nWithin near, the financial area of the business is extremely important as it analyses how well following(a) is meeting its objective of maximising profits. This area in spite of appearance the business has to keep an exact and very detailed record of the money paid in and out. Also various financial records have to be aimd at regular periods, for example balance sheets and profit and loss accounts. This is so that the aggregate if profit and income the company is acquiring can be analysed clearly to determine its success or any adjustments that need to be made if the income is low, in order to maximise profits that contiguous is receiving.\r\n nigh have subdivided their finance and accounts area into two further function areas. One area is the precaution score function. This provides the managers with figures, which will help them to make decisions, maybe near price decisions, at heart the business that could help them go their financial position.\r\nThis functional area has the cleverness and the responsibility to shift the company in specific directions by making decisions in relation to the analysis of figures, and enables them to use these figures to make predictions for the future. Improvements that attached may decide to make are based upon the information extracted from fracture down of the figures to break the exercise of the business. If the performance is not satisfactory then targets are set for the business to achieve to split its performance. Also limitations o f spending may be set for specific areas of the business, by using certain control systems such as budgeting.\r\nThe cashiers division, deep down the accounting functional area, involves the collection of any cash or other payments from each till within the store so that the cash transactions can be analysed and the sum can be checked. otherwise payments to the store through cheques or payments through bank accounts are also handled in this department, and then these will be preserve in cashbooks or within the stores’ computer system.\r\nThe wages department is in charge of managing the payrolls by calculating and paying(a) the wages. The information needed to calculate these figures are obtained from the timetables of hours worked by the employees on each department within the store, so that the amount of pay they receive is accurate.\r\nThe second subdivision within the finance and accounts area is the financial accounting function, which keep records of any financial e vents that may have occurred in order to keep summaries of financial dealingss. Any debtor or creditor details must be recorded as well as accounts of the amount of money existence paid into or out of the business. To ensure the company does not give out incorrect wages, factors such as national insure will need to be calculated and deducted from ones wage.\r\nOther financial accounts have to be provided such as annual reports so that figures can be easily obtained ready for watchword between the directors.\r\nMarketing\r\nWithin this area of the business, it is important that customer requirements are identified, anticipated, and squelched beneficially in footing of profit. This once more links to succeeding(prenominal)’s main objective of maximising profit. Although marketing and sales is combined in following(a), they both have distinctions between them. The marketing area have to convey the company to produce what the customer wants, whereas the sales area have to persuade the customer to want whatever the company may be producing.\r\nThe marketing department have to look into what the customers wants and postulate are, therefore enquiry, e modifiedly primary question, has to be carried out to find out details close to the market for example, who is in it, what this concomitant market wants, where, how, and at what price one way of finding out this information through primary research is to carry out questionnaires. Although neighboring do not produce their own products, their marketing area has a close link with the producers of abutting’s products to ensure the requirements of the customers are closely link up to the development of the product. Other tasks carried out by the marketing area are pricing, distribution, advertising, promotion and promotion. All these factors must be considered conservatively to ensure the success of the product.\r\nHuman resources\r\nWithin Next the human resources counseling area, also known as the Personnel debarment, is involved with recruitment, market share, liability, organisational organize, type of ownership, motivating workers and industrial relations.\r\nenquiry and development:\r\nWithin Next, the research and development area is linked to the commercial department, as its functions are commercial, which are achieving and furthering the aims of the business. This is achieved by up(a) existing products or creating alone new ones, operational do byes are also cleansed to ensure the products are also mitigated successfully. Advice is given to the company in order to choke them in the counterbalance direction throughout the course of improving their products and processes. If this flow of new and alter products were not carried out then Next would be unlikely to remain successful, as they would still have their unsuccessful products, which would necessitate no income into the company, therefore the profit will come out of the closet to fall.\r\nAdminist ration\r\nThe administration area within future(a) work towards provided the employees with any documents needed, communicating messages as well as dealing with any enquiries.\r\nMANAGEMENT STYLES\r\nThe structure of an organization depends a lot on its way ardour.\r\nThe main management way use in Next is republican this is a system based on comparability of all members of their community. This allows the main managers to develop. The staff within Next are given a framework with which they are given more responsibility and the opportunity to make decisions. However, employees are still encouraged to take part in decision-making. Therefore these individuals are held responsible for(p) for any decisions that they may chose to make. This recognizes employees are stakeholders in the organization. The democratic farter listens to all staff and is instinctive to take suggestions on board. Advantages for this type of style is that it helps activate employees well because it mak es them feel like they are being appreciated. Also the employees are well informed about the organizations aims and future plans. However it can reach out to disadvantages as well as it is sticky to apply.\r\nAutocratic styles are nightimes also used in close under certain circumstances. This is when one person has controlling power. The managers make all the decisions without consulting the employees. Employees can get unmotivated by this, therefore cause a negative atmosphere in the workplace. However there are round situations where harsh tone downership is vital. Advantages of this are that quick decisions can be made and there is no time wasted on discussion resulting in the business manner of speaking time and money. Next only use this system when quick decision-making is vital, usually by the manager, for example; if there is a close deadline to be met, but it rarely has a negative effect on the staff, as it is not used to intentionally stop members of staff.\r\nCo nsultative management also takes place within next and this develops their democratic style with which workers are asked opinion. Before any decisions are made, the manager consults their team. Employees discuss the problem and views taken into good will. The decision is the managers but based on the conclusions of the group. The advantages of this are that it helps to motivate staff as they are aware that they have a say in the business to whatever extent as with the democratic style, but their decisions are not necessarily what the company goes by.\r\nThe disadvantages of this are that it is time consuming and effort will be needed by a manager to do this. The commission encourages employees to set goals in line within the organization aims. This is management by objective. The employees are reviewed regularly in performance appraisals. The advantages of this style are that it will increase efficiency of individuals and help to motivate them and train them so they are productiv e. However, the disadvantages of this is that it needs to be well organized and will not work in exceedingly structured jobs.\r\nThe Democratic style is the management style that Next adopts in general. This sort of management style involves empowerment. With this type of management style it allows the manager to feel comfortable with other people in the organization making both(prenominal) of the decisions. Democratic managers will often want feed back from their employees on decisions being made. Democratic melt downers therefore have to take time to listen and mayhap act on the opinions of the group. This type of management is good as it makes the employees happy and productivity is high. This is very good because employee’s thoughts and suggestions are listened to by the business. This makes the employees seem as if they are respected and that their thoughts are valid.\r\nManagement alien mission\r\nThe Chief Executive has delegated authority for the casual manageme nt of the business to operational management drawn from administrator directors and other elderberry bush management who have responsibility for the particular areas. The most important management meeting is the weekly NEXT Brand vocation meeting, which considers the performance and development of the NEXT Brand through its different distribution channels. It considers all business aspects of risk management in respect of the NEXT Brand including sales, property, product, systems, warehousing and personnel. Key performance indicators are monitored unremarkable and weekly.\r\n guess management\r\nThe Board is responsible for the Group’s risk management process. It has given responsibility for achievement of the risk management process to the Chief Executive and senior management best certified in each area of the business. The Board sets guidance on the general level of risk, which is acceptable and has a considered approach to evaluating risk and reward. The Board confir ms that it has a take a leak carried out a review of the stiffness of the Group’s system of native control binding financial, operational, fulfillment and other controls and risk management. This includes identifying, evaluating, prioritizing and revising risks, determining a control strategy for each significant risk and consideration of how each risk might wedge on the achievement of the business objectives.\r\nRisk management and inseparable control is a continuous process for the Board and has been considered on a regular basis during the year. The Board promotes the development of a strong control culture within the business. During the year the Board addresses the business risks that have been identified as vital, including a review of these risks that takes into account any changes in circumstances over the period. The Board considers that the Group’s hierarchical structure of management and continuous monitoring of key performance indicators provides the e arly warning mechanisms necessary to identify any areas of concern.\r\nCommunication channels\r\nCommunication with employees\r\nTeam briefing/ team talks- internal and formal\r\nThis is carried out each morning with all members of staff work that morning shift and all the mangers within the store. This gives an opportunity for suggestions to be made and opinions to be shared by members of staff. It gives them need as they feel part of a team, as they are able to discuss their views on certain areas. The manager also sets targets for the day and informs the employees of the success or failures which have been encountered.\r\n prepare (Face to Face)- internal and formal\r\nThis method of internal communion will result in successful communication with customers through an external channel. The employees at next need to be informed on how certain tasks are carried out before they start working at the store. This is to ensure that they are able to see to any queries the customer may have. Training the staff will ease the work load of the managers, as they are able to help with the tasks involving customers on the shop floor and therefore help achieve the business objectives. Also, incentives may be given to staff if their hard work is identified, this may motivate the employee to work hard in order to be rewarded.\r\n cognitive operation Appraisals-internal and formal\r\nThis form of communication occurs between the floor manager and the individual members of staff working on that particular floor. This process involves the evaluating of the performance of the individual employee. The manager then provides feedback to the employee on areas where adjustments may need to be made involving performance. This process acts as development experiences, which should enable the employee to improve knowledge and understanding in cookery for future responsibilities. Expectations and requirements are expresses by the manager so the employee is able to set targets to bette r his/her performance.\r\nNotice Board †informal and internal\r\nThis method of communication is used within Next to inform employees about different subjects, for example; events that are due to occur, or perhaps reminders are highlighted to be remembered whilst working, for example customer service. Letters stating the mature and objectives of the business are also placed on the board so it is clear to the employees what they are aiming to achieve.\r\nRoster †formal and internal\r\nThe rosters within next are held on the shop floor and ensure that all members of staff have a clear trace as to what tasks they will be carrying out throughout their shift. They are given set tasks every hour for example: till service, fitting room running, etc, this motivates the staff as they will not get worldly by having to do the same thing all day (job rotation).\r\nCommunication with customers\r\n guest service\r\nWithin Next customer service is essential within every task carried o ut be the employees. The person on front cover has ensure the customer is greeted on entering the store, and if there are any customers already in the store must be approached and asked if they require any help. Employees of next are taught to put the customer first in all circumstances, as they are the ones who are back up next financially. When serving customers on all the till or fitting rooms, they should be greeted and ask if they require any help, in a polite and friendly manner. If a customer requires an item alternatives could be offered as well in order to increase sales.\r\nInternet Selling †external communication\r\nThe Next directory has a link with the next website where customer are able to view and purchase clothes, through online shopping, from next in the comfort of their own homes. The website used is www.next.co.uk\r\n fussy Offers †external communication\r\nThis communication method is used to attract customers to buy products at reduced prices, howev er, after having entered the store customers usually decide to purchase other products they like which may be full priced, increasing Next’s profit.\r\nWindow Displays\r\n actual items that are in the store are arranged in an eye-catching mode and then put on display in the window, so any passers by are able to view items in the shop without having to enter. This may attract new customers who have not visited the store before.\r\n step assurance + adding value\r\nNext do not have a great deal to do with the production process however to ensure the quality of the products are the highest standard possible, the best quality manufacturers are used. The items are continuously checked within the warehouse as well as when they are legitimate by the individual stores. If there are any faults in the garment when being checked in the circulation, then these items are withdrawn and renovated. This process is defined as quality control, and is involves with the espial and removal of a ny products that fall on a lower floor the set standard after they have been produced.\r\nQuality assurance involved attempting to prevent any faults from occurring in the first place. All the returns are monitored and if a trend occurs in the fault of a garment, then the manufactures are seizeed in case there is a fault within the production process. The products are tested to ensure they are highly durable, and therefore of o high quality.\r\n grade is added to Next’s products by its quality assurance and control. The way in which the marketing area of Next carries out its research ensures that sufficient information is obtained about the expectations of consumers so that quality standards required from the consumers is created. This adds value to the product, as the consumers will be more willing to pay for the product as it is at a high quality.\r\nNext have to accept the fact that their designs will not enable them to ‘get it mature’ every year, so they ha ve to take whatsoever risks. Small companies are able to do this and can go on touch; however, larger companies cannot and so therefore need to have systems. Any mistakes that next die to make with any designs of their products do not last too long, as they have a short product round of drinks because they work in seasons. Each new season brings new products. This enables next to bring in new clothing designs and improve on the designs, which were not a success; this will mean further marketing research. However, any products which proved to be a success can be carried over to the next season so that Next can keep their income rate high as they already know the product is successful.\r\nImpact of ICT\r\nThe retail systems used by Next are their own as they are packages that they wrote based on their archetypes. They invented them themselves, however, they’ve outsourced their central processing unit computers and payroll packages. The use of ICT allows the different functi onal areas within next to pass their information through from one to another. This enables them to work together more efficiently as each area has the same information to work with. For example, this can be used for means of administrative work so that any paperwork that concerns costumers can be passed out to the required functional areas within the business\r\n knowledgeable ICT Communications used by Next use ICT to announce both internally externally. This includes communication between managers for example faxing is used to contact each other because they have a fax machine set within their office, therefore they are able to keep a record of what has been communicated, for example, records or letters. If management need to be contacted by the employees from anywhere within the store then pagers would in all probability be the alternative to contact them, as it is heard throughout the store so they will receive it reliable away, whereas with faxing, it may not be received s traight away as they may not be in their office.\r\nAt the till point customers are able to purchase their items, as well as order items in. This can be done as the till enables one to check what items are available to order from the warehouse, or whether any local stores have them, if so then the item can be sent to the store. The till keeps an account of what items have been interchange so best sellers can be identified and the worst selling products can be improved on. It allows more information to be exchanged or to be researched within the store\r\nInternet selling is one main use of ICT within Next; it allows customers to shop and purchase whilst at home so they are able to take time to view products. Also it may appeal to more people who are often too busy to come out shopping. It is an effective way for next to maximise their profits. It also has informative areas on the website which show annual reports of the business to indicate how successful a year it has been. This id ea of online shopping may not be such a good idea in some ways as the customer is otiose to try products before purchase so if it doesn’t fit it will have to be returned.\r\nWithin the financial area of the business the current accounts are stored as files on the computer, to keep it organised well and to ensure it is easily accessible. Also, with the use of specialize software, the procedures involved with accounting are alter a great deal.\r\nSuccess of meeting objectives:\r\nPROFIT AND LOSS ACCOUNT\r\n disturbance and profit figures are set out in the table below:\r\n employee turnover Profit\r\nExcluding VAT Before valuate\r\n2003 2002 2003 2002\r\n�m �m �m �m\r\nNEXT Retail 1,579.7 1,359.7 213.9 188.2\r\nNEXT Directory 471.7 362.2 65.1 49.2\r\nThe NEXT Brand 2,051.4 1,721.9 279.0 237.4\r\nNEXT Franchise 22.7 19.1 4.4 3.7\r\nVentura 97.4 101.9 11.2 13.0\r\nOther activities 31.1 28.8 15.1 2.5\r\nESOP charge (8.2) (8.0)\r\nTur nover & operating profit 2,202.6 1,871.7 301.5 258.6 +17%\r\n recreate (expense)/income (0.3) 7.2\r\nProfit before tax 301.2 265.8\r\n tax revenue (90.7) (76.0)\r\nProfit after tax 210.5 189.8 +11%\r\nEarnings per share 68.7p 58.1p +18%\r\nThe profit and loss account above clearly indicates that Next has successfully met its objective of maximising profits as it has increased a further 11% since 2002.\r\nNext have continued to make good progress within the year 2003. Earnings per share rose by 18% to 68.7p and were improved by the useful effect of the share buybacks in the last two years.\r\nNext want to own fewer, bigger stores in order to take advantage of the economies of scale. This is a strategy in which they have been working on for the past few years. They are not interested in underdeveloped the number of stores in all areas, they have generally chosen to expand into towns, which they would prefer their stores to be in, and now they have stores in these areas chosen. E ach store has to fit their model in terms of footfall and the time in which it will pay back their investment. Next currently have a 4-5% market share in the UK, but they hope to increase this up to about 8% in the next pentad years. However it is important that they do not dilute their management by diversifying the business or expanding into Europe.\r\nThe Corporate strategy of next: From the early 1990’s Next have resisted all attempts to increase the number of clothing brands that they operate because they were convinced that expansion would lead to the failure of the NEXT Brand. The success that they have achieved over many years as a result of product development, the progressive tense move to larger stores and the increase in the number of home shopping customers, shows that that it is right to continue with their strategies as it is obvious that they are being met successfully due to the success of the business. Although Next retail is what Next is most associated w ith, the Next Directory is also proving to be financially successful and has a turnover of almost �500m and is one of the few really lucrative home-shopping companies in the UK.\r\nNext’s ability to generate cash enables them to continue to buy back their shares when it is in the interests of our shareholders. This is an important part of their aim to deliver long-term growth in earnings per share.\r\nThe success of NEXT is due to the following factors: Their focus on providing their customers with the product they want. The strength and skills of a good, well motivated management team that is true(p) to recognize its mistakes and quick to put them right. The support of their suppliers with whom they work in partnership to achieve good quality and value for money products. Also, the enthusiasm and dedication of all their employees who take great pride in the success of their company.\r\nNext Retail Financial Performance\r\nYEAR\r\n2003 2002 %Change\r\nSALES 1, 12 1.0 944.8 15.7\r\n run PROFIT 130.4 113.6 12.9\r\nPROFIT BEFORE assess 123.2 115.8 6\r\nPROFIT AFTER tax income 85. 7 81.1 5.4\r\nEARNINGS PER SHARE 31.7p 25.5p 19.5\r\nNext Directory Financial Performance\r\n2003 2002 % change\r\n�m �m\r\nSales (exc VAT) 247.1 215.3 +15%\r\n* sprightly customers 1.58m +17%\r\n* Printed pages 1, 246 +20%\r\n* Disappointing profit growth\r\nNext is expected to continue to maintain its solid operating performance and strong free cash flow generation, while carefully managing its maximum potence share buyback of up to �600 million during the financial year of 2004. In order to continue this solid operating performance, there needs to be flexibility within the company’s supply chain and stores. Next has to maintain its successfulness of the correct levels of inventory and the capability of being able to respond to changes in fashion with shorter lead times.\r\nThey need to keep a train and controlled and expan sion strategy. Also a comparatively guileless company structure needs to me maintained to allow successful communication and to allow any problems to be work together as a team.\r\nHowever, their organizational objectives may not be successful, as the profit growth is rather disappointing. A stronger relationship will need to be built with customers so that they are able to develop a better nature for excellence and increase brand loyalty of the customers so that they carry out repeat purchases in next as they are familiar with their products and are satisfied with them.\r\nOrganisational structure\r\nAlthough outside the individual next store the structure seems rather tall, in terms of individual Next stores the structure would most probably be classed as being a now structure as the store manager is in charge of all of the smaller functional areas, which are then in charge of their own section and their staff. This ensures that the span of control is shared, so managers have a shared amount of people to supervise. This therefore results in tint distribution of workload, so the managers are able to carry out their duties effectively. Also with this flat structure, communication is not as limited as people are more accessible to communicate with, as there are more managers of different areas within the business. However, if there were fewer managers then this would mean that they would not be able to communicate with all members of staff as there would not be enough time available to do so, which may result in lowered motivation levels for the employees.\r\nsimplify representation of organisational structure:\r\nChief executive\r\nSales director\r\nRegional manager\r\nArea manager\r\nStore manager\r\nAdministration Finance Human Research and Marketing Production\r\nResources development\r\nOrganisational effect: Next plc’s strength is their adult fashion range, which is for people aged between 20 and 40; these items are sold under their own labe l. This is their main target group. Although some of Next’s competitors find it difficult to satisfy the needs of this particular segment within the market, however, Next has managed to achieve this successfully in the past by selling their products at relatively low prices.\r\nWith their label, next associate their good quality of clothes used as well as good workmanship. Because next are using their own brand, they are able to react on consumer wishes very apace and therefore have total control over the total quality management.\r\nOrganisational Weaknesses:\r\nThe e-commerce section can make further gains. Next sees the Internet as an extension of perhaps the telephone in which people can order their product online. It is a simple process, which only really requires the vehicle that will get the orders to the retailer.\r\nAt present, it is uncertain whether e-commerce will be the future of shopping and if customers are satisfied just sitting on the computer to chose their clothes, however, if the trend in network shopping goes further, then unfortunately Next would be in a sturdy situation in comparison to its competitors as its platform isn’t sufficient enough.\r\nanother(prenominal) weakness is the concentration of similar type of clothing retail companies on the UK market. This may damage the next if its competitors gain market share or if consumers change their habits and next cannot adapt to these changing trends quickly. To spread into foreign markets could perhaps balance any possible risk of decreasing sales. A policy such as this would strengthen Next’s position if the pound became weaker or if the government decided to join the monetary union.\r\nAs Next uses democratic management styles, they highlight open communication, which is based on self-managing teams. These teams are able to share the workload of the managers therefore objectives can be met more quickly and efficiently, rather than the manager being left to carry out a load of work with a escape of communication with the staff. Also this high level of communication ensures all members of staff are aware of the task in hand so they are able to provide a high level of customer sevice and can help meet the requirements of the customer.\r\n pick approaches could be used in order for Next to meet its objectives better:\r\nThe employees could be given more power and responsibility and make them feel more part of team. This would involve changing the culture, in order to make the staff more of a team. The structure will then be flatter, people will work in teams less of a hierarchy, less feel of a division between staff and managers.\r\nAlternative or more motivation methods could be used so that the employees feel more sense of belonging and feel more included in the business so are happier working there, and this will be reflected in the way they work and come across to customers, which will probably be more enthusiastic and willing to help. Bo nus incentives could be a form of motivation, as it will mean that the employees are more willing to work harder and at their best in order to achieve a bonus.\r\nNext could also carry out the process of share save, where they buy shares at reduced rates, and therefore have more money that could be worn-out(a) on expansion of stores or developing new and developed products.\r\nGood quality and price\r\nThis factor is key for success. One way to achieve this object is perhaps to look for a supplier who is fixed in an emerging market to figure at low labour costs. However, this untaught should have a clothing manufacturing background, for example India, Turkey or Hong Kong, so that it is lightheaded to recruit well-trained employees. Furthermore, the supplier should be a part of the production process, so that stock capacity can be reduced.\r\nA quality officer from Next should be at the suppliers at all times in order to guarantee the high quality of clothes. To lower the costs and to gain a better trade position, suppliers should be reduced to a minimum and therefore new price conditions negotiated. This can lead Next to low costs and high quality in the long run.\r\n alliance between next and its environment\r\nThe unripened issue is gaining greater importance and Next should aim to make further progress in this area. The production process should ensure that Next guarantees that plants are environmentally friendly. The factories should contain filters so that erosion is reduced and any used chemicals are biologically decomposed.\r\n some other area is labour force. Next and its supplies should try and aim their production to be carried out successfully and without child labour. This should be communicated to the customers of Next.\r\nShopping as an event\r\nValue should be added for customers, customer care and service should be provided in general. Next should ain to expand their smaller branches into superstores, so that customers are offered specia l services, i.e. clothing consultancies, childcare. In order to attract more customers and help them enjoy their shopping experience small events should be held. Next could perhaps place a small caf� or resting area in the store for inactive people who are not engaged in the process of shopping.\r\nIn order for the main aim of â€Å" forked digit growth” to be achieved and for next plc to get a better position in the market, a strong brand and good service should help lead to this.\r\n'