This paper examines the business operations of Dillard's, Inc., one of the United States' leading national fashion apparel and department store retailers. It traces the company's founding in 1938 by William Dillard in Nashville, Arkansas, through its growth into a 29-state, nearly 300-store chain generating over $6.6 billion in annual revenue. The paper analyzes Dillard's product lines, mission statement, core competencies, and overall competitive strategy, which centers on offering branded and private-label merchandise at affordable prices. It also addresses the strategic challenges the company faces, including market saturation and declining sales in certain regions, and outlines the company's goals, objectives, and grand strategies for future growth.
With retail operations in more than half of the states, it is reasonable to suggest that most Americans are not only familiar with Dillard's, Inc. and its line of quality products, but have personally shopped there in the recent past. Founded 78 years ago, Dillard's has weathered economic downturns and changes in consumer preferences to emerge as a leading national retailer with a solid brand reputation for quality and customer service.
This paper provides the history and background of Dillard's, a description of its product lines and business, a brief description of the industry in which it operates, and an analysis of its vision and mission statements. An evaluation of Dillard's core competencies and firm strategy is followed by an assessment of its overall strategy. An analysis of potential alternatives available to Dillard's for the future is then followed by a discussion of its goals, objectives, and grand strategies. Finally, a summary of the research and important findings concerning Dillard's business operations is presented in the conclusion.
Today, Dillard's, Inc. (hereinafter alternatively "the company") is a leading national fashion apparel retailer (About Dillard's, 2016). The company's current sales revenues are more than $6.6 billion a year, based on its operation of 274 retail facilities and 23 clearance centers in 29 states, as well as its online store at dillards.com (Corporate profile, 2016).
Founded in 1938 by William Dillard — who died in February 2002 — with its first retail store in Nashville, Arkansas (Dillard's history, 2016), the company is currently headquartered in Little Rock, Arkansas (Corporate profile, 2016). Shortly after its founding, the company expanded its operations to include Texarkana, Texas and Tulsa, Oklahoma, and it opened its first retail mall outlet in 1964 (Dillard's history, 2016).
Besides fashion apparel, the company also features home furnishings, cosmetics, and a wide range of other merchandise including exclusive and national brands (About Dillard's, 2016). According to the company's corporate profile, "The company's stores offer a selection of merchandise, including fashion apparel for women, men, and children; accessories; cosmetics; home furnishings; and other consumer goods. Its merchandise selections include brand merchandise, such as Antonio Melani, Gianni Bini, GB, Roundtree & Yorke, and Daniel Cremieux" (Corporate profile, 2016, para. 3). In addition, the company also offers services including gift registries through its corporate website (Corporate profile, 2016).
Beyond the foregoing, the company operates a general contracting construction company, Little Rock-based CDI Contractors (About Dillard's, Inc., 2016), which provides construction and remodeling support for the company's nationwide chain of retail stores (Corporate profile, 2016). The company also owns and operates Acumen Brands, which provides online retailing — including scrubshopper.com for medical uniforms and countryoutfitter.com for Western wear — that further boosts its online sales (About Dillard's, Inc., 2016).
The company competes in the services sector within the department store industry, with its major competitors being Kohl's Corporation, J.C. Penney Corporation, and Macy's (Corporate profile, 2016).
The company does not maintain a formal vision statement, but its mission statement is highly congruent with its real-world business practices: "The Company focuses on delivering maximum fashion and value to its shoppers by offering compelling apparel and home selections complemented by exceptional customer care" (Dillard's mission statement, 2016, para. 3). The exceptional care offered by the company is reinforced through ongoing customer service training for Dillard's employees (Fields, 2009) and its focus on core competencies as discussed further below.
The company's core competencies relate to its ability to offer high-quality product lines — some of them exclusive to Dillard's — at the lowest prices possible within its niche market. According to one industry analyst, "Family-run retailer Dillard's has created substantial shareholder value over the past five years by sticking to its core competencies: offering branded and private-label merchandise at affordable prices, and limiting its operations to its Southern and Midwestern home base" (Hanley, 2013, para. 2). These core competencies have been supported by the company's broader strategy, which is discussed below.
Notwithstanding the company's nationwide operations, it has been the firm's strategy to consistently provide low pricing and high-quality merchandise as part of the national Dillard's brand (Dillard's history, 2016). In this regard, the company reports that, "Today, a major part of Dillard's marketing philosophy remains based on Mr. Dillard's sound selling methods, keen attention to day-to-day organizational details, alert selection of personnel and hard work. Presently, the chain consists of approximately 300 stores spanning 29 states, all operating under one name — Dillard's" (Dillard's history, 2016, para. 4). The company has enjoyed several straight years of sustained growth, due in large part to increased sales in its women's accessories lines, which represent about 15% of its annual sales (Hanley, 2013). Dillard's has also increased its sales revenues by offering private-label brands such as Roundtree & Yorke and Antonio Melani (Hanley, 2013).
"Branded merchandise strategy and competitive pressures"
"Family management, expansion goals, and grand strategy"
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