The Value Chain Of Nordstrom's Inc

Value chain is a set of activities a company performs in order to provide a valuable solution to their customer problem in their market space or industry. The value chain is made up of primary and support activities. Primary activities being research and development, production, marketing and sales and customer service. These are the primary steps that are required to get a product or service to market to solve the customer problems. Some of the secondary steps include company

Nordstrom’s product selection is probably the store’s most effective method of distinguishing itself from its competitors. The comprehensive categories of goods which the store supplies offers the initial disparateness from most other retailers in the market. Many stores offer a specific category of goods, such as food with grocery stores. Other retailers, such as Target or Walmart, offer a wide variety goods. Nordstrom’s has established itself as a retailer of clothing, shoes, and accessories. This over-all summation of the store

Effective value chain as a competitive advantage can contribute significantly to the prosperity of a firm in the competitive arena, but it can cause dire situations if not operated properly (Guy, 2011). However, there are conflicts among companies as to how stakeholders think they gain competitive advantage. Porter (1996) suggests: A company can outperform rivals only if it can establish a difference that it can preserve. It must deliver greater value to customers or create comparable value at lower cost or do both.

As one of the largest and most well known retailer worldwide, Nordstrom continues to be an iconic fashion influencer. The company is known based of their outstanding customer service, which is based out of their founding philosophy: offer the customer the best possible service, selection, quality, and value. Nordstrom is based off the idea to always serve the customer better than the competing retailers directly by forming long lasting, hart felt relationships with their customers. Providing an easy cross channel connection between their stores and online experience allows for customer to shop at their convenience.

Nordstrom’s and Topshop’s marketing strategy both target a specific segment of the market. While Nordstrom’s focuses on higher end/quality goods and competitive pricing, Topshop’s offers consumers the runway and street fashion at affordable prices. The companies are examples of niche marketing, which “allows the organization to create more narrowly focused marketing plans for its brands than segment marketing approaches.”(Finch, 2012)

Nordstrom has quickly become one of The United States’ best high-end fashion Specialty retailers. Among their store expansions and sales growth it is their strategy in targeting two market segments has placed them in an optimal marketing position. Within the business there is first the Nordstrom name brand, which sells

Value chain analysis looks at every step a business goes through, from raw materials to the eventual end-user. The goal is to deliver maximum value for the least possible total cost. It is a systematic approach to examining the development of competitive advantage. The most basic breakdown of primary functions includes inbound logistics, operations, outbound logistics, sales and marketing and service. People should use the other models and frameworks within this software to further differentiate between, and add to, these domains. Product Innovation is one area that is not normally included in the de jure model but is often included in the de facto model. Value Chain Analysis describes the activities that take place in

Nordstrom are famous for having a short and simple employee handbook. Its states, ‘Use your best judgement in all situations. There will be no other rules.’ Nordstrom’s connected structure and culture is designed around putting the customer above everything else. They treat employees like entrepreneurs, by allowing the decision-making process to be pushed down to the frontline. Nordstrom provides each salesperson in the company with the support and resources needed for this, and therefore can place this decision-making trust in their sales team.

Nordstrom has come a long way since its humble beginnings as a shoe retailer in the early part of the 20th century. Now with the 4th generation of Nordstroms at the helm, it has positioned itself for the future with its customer-centric focus and rich history of entrepreneurial spirit. This analysis will focus on the transformation of their core operations and the potential for future strategic movement in the world of retail sales.

Value chain of a business is the process of transforming raw materials in to product, which creates value for its customers. As defined in [1], the value that is created and captured by the company is the profit margin:

Value chain analysis is an influential instrument for executives to recognise the crucial actions within the company which create the value chain for that association, and have the potential of a maintainable competitive advantage for a business.

With help of the following value chain I analysed the activities of the company. It connects the company analyses and the strategy development – we can also see the strengths and weaknesses of the company which we can use to moderate a corporative strategy for the company profile.

Value chain is an approach to know how an item or activities create value for consumers. The most of value provides to consumers, the most of competitive advantage an organization build. In this analysis, value chain model has separated into primary and support activities. Primary activities are included in the physical creation of the item and service. On the other hand, support activities give the inputs and infrastructure that enable the primary activities to happen. This value chain model can be refer to below figure 5.

Porter´s value chain model shaped our way of understanding and analyzing industries for the past 30 years. It explores the links between the activities to be undertaken in order to commercialize a product in the market and how these activities add value to the final delivery (Peppard and Rylander, 2006). It focus on the value creation processes within the firms, not on the inter firms links in the value chain (Kothandaraman and Wilson, 2001) and how the different links influence the competitiveness of the industries (Peppard and Rylander, 2006).

A value chain is nothing but a set of activities that a firm operates to deliver a much valuable and quality product or services in the market. The term comes from Business management and was firstly coined by Mr. Michael Porter in his best seller.