Yogesh Chauhan's Blog

RBV Framework and closing of big brands

in Miscellaneous on June 6, 2020

Using the RBV framework, I feel like these are the 3 firms that are most likely to close post COVID-19…

J. C. Penny

JC Penny provides Buy Online Pick Up In-Store (BOPIS) which is really VALUABLE. Also, they are pushing for hospitality industry as well, which is their competitive advantage if we consider the retailing market. But BOPIS is NOT RARE. Many stores are doing to the same and in fact Walmart is way ahead of all. It is NOT INIMITABLE as others can easily copy. Also, they are NOT ORGANIZED as they could have done so much better when they implemented the BOPIS, but they failed at doing so and now most of their store are closing.

Kmart

For Kmart we can say, they spent in IT in smart manner. They have just in time inventories and low prices. Which makes the resources VALUABLE but are they RARE? Of course NOT. Walmart and Target are spending far more and doing far better than them. It is NOT INIMITABLE as others can easily copy, in fact Walmart does it even better. K-mart’s relations with the suppliers gave them hard times and they had financial difficulties as well. So, the resources were NOT properly EXPLOITED BY THE ORGANIZATION.

Sears

K-mart and Sears go together, even to downfall. Once there was a time when Sears was in US customers heart and their brand was so popular. We can consider it a big resource. It WAS VALUABLE but not anymore. It WAS RARE but not anymore. They have declined in last 20 years and they are going down even further. They are NOT INIMITABLE as Walmart has replaced them in 1990. The resources were NOT properly EXPLOITED BY THE ORGANIZATION. Many analysts blame to the management for the fall of the Sears.

Using the RBV framework, I feel like these are the 2 firms that are most likely to survive post COVID-19…

Newell Brands

Newell Brands have core brands like Oster, Elmer’s, Sunbeam, Sharpie, Yankee Candle, Paper Mate, Mr. Coffee, and Coleman. They all are their useful resources and the Newell Brands itself is a household brand name for many.  So, the resources they have are VALUABLE and RARE as well, in terms of the brand-building for many core brands.  They are INIMITABLE as to create that kind of brand-positioning and brand reputation in the market can take years. I feel like the resources were properly EXPLOITED BY THE ORGANIZATION because they just released their 2020 quarter 1 financial earnings and it’s not too bad considering how hard the company and other businesses are hit by COVID-19.

H&M

Their main resource would be providing high fashion at low cost and they have a very good customer base as well. Their strong brand awareness is another resource they have which is VALUABLE as well. Now the thing with clothing industry is people like to follow their icons for e.g. specific sports person or actress etc. So, it is debatable that the resources they have are RATE or not, but I would say for their customers – for a niche market – it is RARE, and it is hard to copy a brand. You can copy the clothing style, but you cannot copy the brand impact it makes on people. So, it is INIMITABLE.  I feel like, after all these years the resources were properly EXPLOITED BY THE ORGANIZATION. Because the way they managed to climb the ladder in the fashion industry is remarkable achievement and we see many companies fail every quarter trying to get to the top in fashion market. Now if we talk about COVID-19 then yes they are hit hard by it but they are talking appropriate measure to keep the company running and I am sure they will come out of in few months.


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