Adairs: A Vertically Integrated Success in Retail

Current Position

As a leading retailer of household textiles and furnishings in Australia, Adairs has 143 stores across the country. The five physical formats, consisting of Adairs, Adairs Homemaker, Adairs Kids, Urban Home Republic and Adairs Outlets are highly successful across the nation. The business has significantly more control over their range, supply chain, and quality than some traditional retailers and have the ability to earn a higher profit margin as they are vertically integrated (Mellor E,2015). This is due to the vertically integrated nature of Adairs, as this enables them to develop, design, source, distribute, merchandises and sell their own products (Adairs Prospectus, 2015). During the 2015 Financial year, the business

Adairs currently takes foreign exchange cover to reduce this risk, however managing the exposure to the foreign exchange rate is difficult.

• The popularity of Adair’s also needs to be considered when comparing it to its international competitors. There is a high level of uncertainty when thinking of how the business will actually perform against its competitors in an international market, here there is a constant risk. Effective marketing strategies need to be put in place to generate awareness of the brand and create a positive reputation around the business. This can be done through advertising both physically and online.

• Adairs needs to always be aware of the current consumer wants, trends and relevant products to ensure that satisfaction and interest is always there.

Conclusion

Adairs is in a highly suitable position to grow and expand their business to attractive international consumer markets. The business has made significant changes to constantly differentiate and diversify their products. Adairs is financially stable to proceed with expanding internationally and will succeed if the recommendations that have been advised are