Hudson's Bay

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CASE STUDY HUDSON BAY

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Executive Summary

• This report had the main core objective of analyzing the case” Hudson’s Bay to Buy German Department Store Chain Galeria Kaufhof from Metro.” Hudson’s Bay (HBC) is a successful Canadian company. In 2015, the company started to expand the market to German and Europe. Entering into an entirely new market is very challenging for HBC. The entire report will cover the following information:

• The primary problem is that: the expansion of HBC in German.
• There are five alternative solutions in this report:

• Meeting customers’ need
• Paying attention to competition
• Understanding the business environment
• Strategic alliance with McKinsey & Company
• Expanding stores in German

• I recommend expanding in Germany and open 60 retail stores by the end of 2020. I think it is realistic and growing should start from the major cities in German. I also recommend looking for a strategic alliance, here, I recommend McKinsey & Company, a management consulting company. This company can assist to develop suitable strategies when HBC first enters into Germany market and not familiar with the business environment here. Lastly, I recommend a constantly changing product choice is essential for HBC expanding the market in German. When facing competition, HBC needs to continually meet customers’ need. While a changing product choice can always attract numerous clients. It is imperative for HBC because it wants to expand the market in German and Europe.

Primary Problem

The primary problem is that: the expansion of HBC in German.

“Hudson’s Bay Co. investors might be forgiven for feeling a bit nervous about its bold, potentially high-risk decision to enter the German department-store market.” (For HBC shareholders, a risky move in Germany)

To enter into a new global market, international strategy is essential to compete in the international environment. Because HBC should cut off cost to compete with a local competitor and customize its products, a transnational strategy is necessary. Moreover, the objective is to open 60 retail stores by the end of 2020. It is a realistic goal, and HBC should look to expand in the main big cities first.

Secondary Problem

“Europe represents a mature retail market with challenges galore for aging department-store players such as Galeria that are struggling to compare effectively against malls and online shopping.” (Hudson’s Bay’s International Expansion)

Online shopping is very competitive because they can cut cost. Most of the young people prefer to go online shopping because of a low price. Hudson’s Bay benefits from real estate holdings; it is hard to compete because online retail do not possess any property.