Nomura Securities Retail Weekend Reading: Reviewing Global Organization Structures & Why It Matters
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Rating Summary:
4 Buy, 31 Hold, 1 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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Nomura Securities Retail Weekend Reading: How Retailers' Int'l Organizations are Structured
Analysts, Paul Lejuez, Aram Rubinson, said, "For softlines retailers, global expansion is not a quick or easy process. Most softlines retailers have senior management teams in place dedicated to their global ambitions (like Tiffany (NYSE: TIF) and Coach (NYSE: COH). Some retailers (like Limited (NYSE: LTD)) are preparing for global expansion. We believe this preparation will help LTD avoid some pitfalls once they ramp up their international store roll-out. In Hardlines, Staples (Nasdaq: SPLS) uses a channel-centric model internationally, but it is not a paragon for success. Rather than build out a separate international organization, Abercrombie & Fitch (NYSE: ANF) leverages its US infrastructure internationally. There is no “right” structure but we believe each is important to understand as retailers become more global."
"Amazon.com (Nasdaq: AMZN) is another ‘retailer’ with significant international operations. International represents 44% of its sales and 41% of profits, or CSOI. Amazon operates with a more geographic structure to its model. Most countries have their own manager. Amazon’s structure is geographic, but it too has seen declining International margins. They report up to the company’s SVP of International Retail, Diego Piacentini."
Analysts, Paul Lejuez, Aram Rubinson, said, "For softlines retailers, global expansion is not a quick or easy process. Most softlines retailers have senior management teams in place dedicated to their global ambitions (like Tiffany (NYSE: TIF) and Coach (NYSE: COH). Some retailers (like Limited (NYSE: LTD)) are preparing for global expansion. We believe this preparation will help LTD avoid some pitfalls once they ramp up their international store roll-out. In Hardlines, Staples (Nasdaq: SPLS) uses a channel-centric model internationally, but it is not a paragon for success. Rather than build out a separate international organization, Abercrombie & Fitch (NYSE: ANF) leverages its US infrastructure internationally. There is no “right” structure but we believe each is important to understand as retailers become more global."
"Amazon.com (Nasdaq: AMZN) is another ‘retailer’ with significant international operations. International represents 44% of its sales and 41% of profits, or CSOI. Amazon operates with a more geographic structure to its model. Most countries have their own manager. Amazon’s structure is geographic, but it too has seen declining International margins. They report up to the company’s SVP of International Retail, Diego Piacentini."
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