Charming Charlie LLC Harvard Case Solution & Analysis

Company Overview

Charming Charlie, one of the finest jewelry and apparel retail stores, is providing its customers with lots of attractive choices. The stores of the company are brightly colored and provokes the fashion sense of their customers, providing them with ample of charming products to select. The offerings of the company vary widely in providing not only jewelry but also accessories that include handbags, necklaces, bracelets, clothing, earrings and other variety of items.

The target market of the company or the main audience is the females of all ages that get a chance to grab style either sophisticated or vintage.The stores of the company are not just organized, but also dunk the customers into an ornamental environment and are mostly located in shopping or outlet malls. There are around 330 retail stores present in around 42 states across the US and Canada.

The company started operating in the year 2004 and after ten years of its inception has grabbed around $500 million in sales, which is the proof of the rapid growth the company embraced during all these years. Charlie Pontchartrain, an MBA from the Columbia University started this business and has around 5000 employees and more than 600 employees are only in US.

The owner plans to increase its grip in the market by opening around 55 more stores in the preceding year and taking the chain up to 800 stores in 3 years. The aim of the company is to attract more customers by providing them a new or attractive environment and promising to lead them to the future.

It is important to view the company’s performance on the basis of the strengths that it created and what are the weaknesses in its internal environment. On the other hand, assessing the opportunities and threats of the company is also important. The company’s workforce is the major strength of the company which is highly skilled and helped throughout the company to build a strong retail network.

Besides that, the company has been constantly supported and helped in terms of money as seeking loans at the initial phases was easy. The company has been growing constantly and the financial performance is the major proof which is very strong. The profitability of the company is strong along with the revenues that are growing. Furthermore, the industry has high entry barriers which eventually provide strength to the company.

On the other hand, the company’s distribution network is also very strong as in a retail chain distribution is the backbone which helped the company grow rapidly. The company has extended its network leveraging its distribution network. Furthermore, the company is present for a long time now and has witnessed recession as well that has made the business units strong and experienced providing another strength to the company.

However, the cost factor is a concern and a major weakness which is very high and is expected to put a slug in the profitability. Furthermore, the company has been not that strong to compete with big retail outlets like Wal-Mart and Target. Any changes in the taxes can further put the company in trouble and make it difficult for the company to survive in the highly competitive environment and market.

Charming Charlie LLC Case Solution

Industry Overview

The apparel retail industry is on the verge of growth and generated around $300 billion in the year 2009 in revenues, which exhibits the strength of the industry and its contribution towards the GDP. Although the retail apparel is for everyone, but the most attractive segment comprised of the women that includes not just clothing but other accessories as well. This segment contributes more than 50% in the revenue generation and is considered as the most profitable segment. However, it is a seasonal business, but the holiday season is considered the most attractive.

Conditions Affecting the Company

The factors that are presentinghinder to the company or any other company in the industry are defined below.

  • The industry trends and the growing competition are the major factor.
  • The political and economic environment is also a concerning factor and as the company is motivated towards using digital mediums, technology is a mother factor that is restricting the company from repaying its commercial loans.
  • The tax regulations can be one of the factors to hinder the objective.
  • The cultural constraints that restrict the company from expanding globally. ............

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