Macy’s is a business organization based in United States of America. It has two headquarters located in the cities of Cincinnati, Ohio; and New York, New York. It was found in 1858 by Rowland Hussey Macy. The firm deals mainly on wide selection and merchandise of clothing and is also known for large stocks of highly competitive brands. Early this year it opened other regional branches in major urban centers.
Like any other prosperous organization, Macy’s has recently faced several challenges on its management and performance from its environment. These challenges seemed to have been aimed at downsizing its tremendous growth in most U.S urban centers. The management and stakeholders have had in recent months faced with a lot of uncontrollable factors influencing the firm’s decision making also known as macro-environmental factors. These have resulted in adverse effects on its performance and strategies therefore a lot of concerns have raised over the analysis of these challenges. Interestingly, they are clearly as a result of political, economical, social, and technological constraints also known as PEST under analytical macro-environmental research.
The factors caused Macy’s company actual results to differ materially from the expected results described in their underlying company’s forward statement. The political influences on Macy’s have recently emerged ranging from the newly imposed regulations to outside politics directed to its management. Clothing fall within ethical fitness in U.S therefore dress code has been the latest challenge facing the manufacturers. In the case of Macy’s, U.S government has been keen on observing the category of dressings sold by this company. The imposing of laws regulating the types of dresses manufactured and worn has negatively impacted on its sales. Another latest challenge from the government is the imposing of high taxes on extra expansion and opening of new branches all over urban centers, this has limited its expansion (Macy’s, Inc, 2009)
U.S has been on the highlight critics on its involvement in overseas military deployment. This has directly influenced Macy’s sales in the foreign countries leading to its economic recession. However, the adverse effect here is its ability to open new branches overseas which has also been limited. Due to the highly volatile political position of the USA on most of foreign countries like Iraq, Afghanistan among others there has been sidelining on government hence adversely affecting the US businessmen and women overseas together with the major multinational companies like the Macy’s. These companies have found it very hard to penetrate the developing and emerging markets which greatly depend on the political and economical positions of those affected.
On the economic analysis; these are changes, for example a recession creating increased activity at lower ends of product price ranges, fluctuation of exchange and interest rates and the worst of them is inflation rate. Last year, U.S economy was strong and nearly every part of it was growing well. However, things changed. Most economists loosely define a recession as two consecutive quarters of contraction, or negative GDP growth (Martinez,2009).This has been blamed U.S participation in military deployment in the intended destination of Macy’s products.
Social factors include changes in cultural practices, population growth rate, attitudes and lifestyles. These changes adversely affected Macy’s profit margins. As an example most citizens were impressed with new fashions of dressing which at then, Macy’s had not made stock (Volkmann, 2010). The recently ended Fifa World Cup greatly influenced the sales and attitudes of particular fashions of dressing. Most fans who earlier happened to be Macy’s customers changed their dressing styles to fit in the football euphoria. Finally the experienced family planning in most U.S states has resulted in low population growth limiting the potential market industrial products including Macy’s
The last factor is technological changes. These are changes in manufacturing, advertising, and product improvement. The recent development of internet and e-commerce has made Macy’s to change marketing strategies. Macy’s have recently involved itself in celebrity challenge, and restructuring of Macy’s annual parade which has became its new marketing strategies (Todé, 2009). Lastly the extension of automation on its processes has resulted on improved quality and quantity of its products.