INDEX

1. INTRODUCTION
The El Corte Inglés group can be considered the first group in charge of

distribution in Spain and number 40 in the world in terms of sales volume.

This company is considered the second family-owned company in Spain, its

shareholders being more or less distant relatives of Ramón Areces. This

company is the family business with the largest number of employees.

Its headquarters are located in Madrid, showing leadership in electronic

commerce in our country. This group obtained a net profit of 319.32 million

euros in 2010.

The El Corte Inglés group of companies is subdivided into the following areas of

activity:

 El Corte Inglés SA is the parent company, whose main activity is

distribution through large department stores.

 Hipercor , mainly dedicated to food distribution, although it also

has a part dedicated to bazaar.

 Bricor , dedicated to the distribution of decoration and DIY.

 Supercor , which is a medium-sized store in the format of a local

supermarket.

 Opencor , convenience stores.

 Superior Exprés , which consists of several nearby supermarkets

and limited space.

 Sfera , are young fashion and accessories stores that emerged as

a response to the competition that the Inditex company faced with

El Corte Inglés, SA.

 Optics2000 ; small surface for the distribution of both auditory and

optical components.

 Informática El Corte Inglés , in terms of information and

communication technologies, dedicated to offering computer

services.

 Telecor company that markets telecommunications services for

both consumers and companies.

 Grupo Viajes El Corte Inglés , dedicated mainly to tourism.

 Insurance Group

 Financiera El Corte Inglés , as a company that finances

purchases for customers.

In this work we are going to try to analyze the company El Corte Inglés, as well

as we are going to carry out an analysis of its strategic direction to be able to

analyze the weak and strong points of the company and see what possible

opportunities are presented to it as well as the possible threats that can be

obtained from other companies outside the group.

2. HISTORY

In 1935 , César Rodríguez González bought a tailoring shop called El Corte

Inglés, SL, created in Madrid in 1890 , a name he maintained because said

tailoring shop enjoyed great prestige in the Madrid of the time and in 1939 a

new phase began by acquiring Madrid a farm on Preciados street. The ground

floor, first floor and part of the second floor are for sale.
In 1945 , this small tailor shop moved to new premises to be expanded. In

1952 , El Corte Inglés, SL became a Public Limited Company, which is why it

was renamed El Corte Inglés, SA.

In 1962 , El Corte Inglés opened its second establishment, in Barcelona.

El Corte Inglés began to have great prestige in Madrid and Barcelona and in

1966 , Ramón Areces succeeded his uncle César Rodríguez as President of El

Corte Inglés. He opens a large warehouse on Goya Street in Madrid.

In 1968 , El Corte Inglés opened its second department store in Seville and in

1969 , the subsidiary of Viajes El Corte Inglés (Vecina) was created and opened

a new establishment in Bilbao and another in Madrid.

A new branch was opened in Valencia and a large warehouse in Muria, in 1971

and 1973 respectively.

In 1976 , the subsidiary Construction, Promotions and Installations was created.

In 1977 the El Corte Inglés chain was established in Las Palmas and in 1979 a

hypermarket subsidiary called Hipercor was created and a large warehouse

was built in the Andalusian city of Málaga.

The expansion of El Corte Inglés began in 1962 with the opening of its second

sales center, located in Barcelona , and continues to this day with the opening

of new centers, although already diversified in different formats of which the

second type was Hipercor , whose introduction It was held in Seville in 1980 .

In 1981 , one of the most important steps in the chain was taken; the acquisition

of the Harris department store in California (USA). In this same year, he also

opened a store in Zaragoza.

In 1982 , he acquired the company Correduría de Seguros and installed a

second large warehouse in Valencia and in 1983 he opened the Home and
Decoration Boutique in Madrid, a great step for his strategy of diversification

and specialization.

El Corte Inglés IT was created in 1986 , as well as a large warehouse in La

Coruña and a subsidiary of Hipercor in Barcelona.

In 1987 , one of the worst moments for El Corte Inglés occurred when a terrorist

attack by the Basque band ETA occurred, causing 21 deaths and 45 injuries in

a Hipercor in Barcelona. A fourth Hipercor is also opening, this time in Granada.

In 1988 , the Ramón Areces Study Center publishing house was established,

and the large warehouse in Valladolid and a Hipercor in Gerona also opened.

Upon the death of Ramón Areces in 1989 , his nephew Isidoro Álvarez Álvarez

took over the presidency, continuing the expansion process, always through

self-financing, opacity in management and prudence in investment. El Corte

Inglés is installed this same year in Alicante.

In 1995 , El Corte Inglés opened new shopping centers.

In 2001 , El Corte Inglés also acquired five new hypermarkets that the Carrefour

company had to divest from when the merger of Pryca with Continent . This

same year El Corte Inglés bought all the centers that the British department

store chain Marks & Spencer had on the peninsula (nine centers in total) due to

its abandonment of the Spanish market (although maintaining the centers in the

Canary Islands) to focus in its original market, the British.

SHOPPING CENTERS OF EL CORTE INGLÉS

The number of El Corte Inglés shopping centers by Community is distributed as

follows:

Andalusia: 23

Asturias: 4

Aragon: 3

Balearic Islands: 2

Canary Islands: 5

Cantabria: 1

Castilla-La Mancha: 2

Castilla-León: 8

Catalonia: 9

Community of Madrid 23

Valencian Community: 6

Galicia: 4
Extremadura 3

Murcia: 2

Basque Country: 4

El Corte Inglés is already present in Portugal. The new shopping center

consists of eight floors, with a total area dedicated to commerce of

approximately 47,000 square meters. With this new center, El Corte Inglés

opens a new stage that can be called internationalization of the company.

3. MISSION, VISION AND STRATEGIC OBJECTIVES

The mission of El Corte Inglés is to offer the public the best product and with

the best guarantees, and for customers to find in one place all the products and

services they need without having to travel and always receiving the best

possible service.

It gives meaning to the life of said organization by pointing out the course of

action that our case involves, consisting of the provision of multiple services and

the sale of all types of products at a national and international level around

values of quality and competitiveness highlighted in the current market. The

mission is, therefore, consistent with the institutional nature of the company.

As we have previously noted, El Corte Inglés is a customer-oriented company

that is the center of decisions, with which it establishes a commitment that

defines its trading style.

These principles that El Corte Inglés has defined throughout its history are:

 Maximum quality.

 Great assortment.

 Excellent service.

 Specialization of each department.

 Absolute guarantee.

The vision of El Corte Inglés is to increase market share as much as possible,

offering more and more products, through increasingly important diversification

and specialization.

El Corte Inglés is currently the first Spanish distribution group and one of the

world leaders in department stores, achieving a very high level of aspirations,

among which we can highlight the consolidation of the company in the

international arena.

El Corte Inglés is a company with more than 70 years of experience and has

maintained since its creation a policy of customer service and a constant

interest in approaching the tastes and needs demanded by customers.

 Strategic objectives

The priority objective of El Corte Inglés is its international expansion. To

achieve this priority objective, El Corte Inglés has the following strategic

objectives:
  Commit your work to the needs of clients.

 Obtain greater competitiveness.

 Specialize your products with customers.

 Motivate, satisfy and involve employees.

 Diversify the business set.

 Expand throughout the national territory.

 Meet the needs of your customers.

CORPORATE SOCIAL RESPONSIBILITY AND BUSINESS ETHICS

El Corte Inglés maintains a solid business model based on a series of ethical

and responsible principles, commitment to customers, respect for employees,

and links with the social and environmental environment. Based on these

pillars, the company has developed a Corporate Social Responsibility (CSR)

policy that is integrated into its own management strategy and is part of the

daily activity of the business.

It is a member of the United Nations Global Compact, which means assuming

as its own the ethical principles and respect for human, labor and environmental

rights that make up this international code.

The principles of organizational culture are:

- Ethics and responsibility:

Ethical and responsible behavior in all areas of the company's activities, which

generates trust and consolidates our reputation.

- Guarantee and customer service :

Guarantee, service and quality with a broad and differentiated commercial offer

that allows us to maintain the business growth of our business model.

- Relationship and connection with the environment:

Constant and fluid relationship with all our interest groups: clients, employees,

suppliers, shareholders, competitors, social organizations, public and private

institutions, and society in general.

- Respect for the environment:

Commitment to respect the environment that has an impact on the different

areas of our business activity.

1. Employees

91% of the Corte Inglés staff have a permanent contract.

Furthermore, the human resources policy is aimed at enhancing the

capabilities and abilities of each person. In 2011, the Equality Plans of

Seguros El Corte Inglés, Telecor and Financiera El Corte Inglés were

signed.

1. Customers

The customer is the axis around which the entire commercial strategy

revolves and the actions carried out are directed towards him, from the
 increase in products aimed at minorities to the initiatives carried out within

the framework of security and guarantee. of the products they sell. The

ultimate objective is customer satisfaction and to achieve this, their needs

are identified, their proposals are listened to and a policy of continuous

adaptation to the new demands and tastes of society is maintained.

El Corte Inglés maintains five key commitments to its customers:

• Quality

•Service

•Assortment

•Specialization

•Warranty

The main objective of the El Corte Inglés Group is customer satisfaction.

For this reason, it has been equipped with a series of internal tools that allow

it to know its level of satisfaction and establish lines of continuous

improvement in order to achieve excellence. To do this, it has a semi-annual

barometer that is prepared based on surveys carried out on its clients.

2. Environment

As a distribution company, El Corte Inglés' activity demands a significant

consumption of packaging material and printing paper. In this sense, it works

to find alternatives that allow us to reduce the consumption of this type of

materials and achieve a progressive replacement of single-use packaging

with other reusable ones or ones made with easily recyclable materials.
3. Suppliers

Since 2008, El Corte Inglés has followed the BSCI (Business Social

Compliance Initiative) Code of Conduct, which requires a process of social

audits for direct suppliers from non-EU countries. The objective is that by the

end of 2012, those suppliers that present at least two-thirds of the

purchasing volume in said countries will have been audited.

4. Society

El Corte Inglés promotes a large number of actions that adapt to the needs

of the environment in which they take place and that cover all types of

programs and activities of a social, cultural, educational and sporting nature.

In the field of development aid, for example, it has long had a relationship

with organizations such as Children's Villages, Cáritas or the Red Cross.

 Ramón Areces Foundation

The Ramón Areces Foundation, established in 1976 by the then president of El

Corte Inglés, Mr. Ramón Areces, is a private, independent and non-profit

institution that remains linked to the company.

Since its creation, it has been oriented towards scientific patronage by

promoting research, contributing to the generation of human capital and the

dissemination of knowledge in three specific areas:

Life and Matter Sciences, Social Sciences and Humanities.

The Foundation publishes its own Activities Report, although, due to its broad

social projection, testimony of its activities is collected within this report. You

can also find information on their website.

www.fundacionareces.es .

In 2011, the Foundation financed 72 research projects: 41 in the field of Life and

Material Sciences, in which 246 scientists work, and 31 in the Social Sciences.

The financial resources allocated to these investigations exceed 5.4 million

euros. The funded projects in both areas have generated 200 articles in

prestigious scientific publications; 110 communications to national congresses

and 231 communications to international congresses.

In addition to its own activity, the Foundation carries out determined work of

institutional cooperation with prominent organizations concerned with the

development, innovation and recovery of artistic and cultural heritage.

The Foundation is oriented towards scientific patronage by promoting research,

contributing to the generation of human capital and the dissemination of

knowledge in three areas: Life and Material Sciences, Social Sciences and

Humanities.
4.ANALYSIS OF THE GENERIC ENVIRONMENT

At this point, we move on to analyze the generic environment of the company

analyzed. To do this, we analyze the external forces that affect El Corte Inglés.

These forces are:

Demographic environment: When taking into account the demographic

environment, El Corte Inglés considers changing family patterns and different

purchasing habits, so they must analyze the different segments of interest.

For the different subsidiaries of El Corte Inglés, such as Supercor, Hipercor,

Opencor, Viajes El Corte Inglés (travel offers for two people), it is very

important, for example, that fewer and fewer couples decide to have children

and that leads to another type of of needs, such as less food packaging, more

pre-cooked foods, etc.

Economic environment: El Corte Inglés is a company whose business model

can be defined as “the store where you can buy everything”; For this reason,

the market must be segmented around the different income levels of

consumers.

In the current period of crisis in which we have found ourselves since 2008, El

Corte Inglés carries out different types of discounts to facilitate the purchase for

customers, as well as interest-free installment payments.

Sociocultural environment: It is a company that covers different topics, so it

must pay attention to the cultural values of Spanish and Portuguese customers,

since El Corte Inglés has two centers in Portugal.

El Corte Inglés also identifies different cultures in order to anticipate their

purchasing needs.
Natural environment: El Corte Inglés is aware of the need to promote the

preservation of the environment to find itself within the framework of sustainable

development. To do this, it maintains an improvement in the management of the

resources it uses to produce its different products. This has led the company to

adopt different actions that are aimed at controlling the different impacts that

may be generated in the activity carried out, both by itself and by group

companies, such as Hipercor.

Currently, the population is very sensitive to environmental problems, which

strengthens El Corte Inglés' commitment to environmental protection. To this

end, El Corte Inglés bases its environmental protection policy on the

responsible consumption of resources, adequate waste management and public

awareness.

This policy has led El Corte Inglés to reinforce the use of renewable energy, to

include energy efficiency in decision-making and to promote responsible energy

consumption.

El Corte Inglés also uses returnable packaging, uses computer tools that allow

reducing paper consumption and the implementation of measures to reduce, for

example, water consumption, as well as trying to minimize any type of emission,

both physically and direct and indirect, Greenhouse Gas.

As important data, we can say that the Group's accumulated issuance has been

reduced by more than 24% in the period between 2008 and 2011.

To comply with the aforementioned, actions are used for waste management,

recycling, etc.

It is worth adding another series of actions carried out by the group in order to

promote the environment, such as the incorporation in many of its shopping

centers of specific parking spaces for electric vehicles with free charging points.

Technological environment: El Corte Inglés is the leading company in

electronic commerce in Spain, so it must consider the technological

environment in order to be up to date with technological trends, since if it were

not up to date it would leave ground for competence.

El Corte Inglés has a technological consultancy that is specialized and therefore

allows it to adapt to new business models.

Political-legal environment: The group of companies belonging to El Corte

Inglés have a series of policies that are established within the legal framework

of Spanish regulations.
 Strategic profile of the environment

STRATEGIC PROFILE OF THE ENVIRONMENT

M. N M.

KEY ENVIRONMENTAL FACTORS N. N D Q P.

POLITICAL DIMENSION

Political situation x

Fiscal policy x

Foreign trade x

ECONOMIC DIMENSION

Inflation x

Unemployment x

Consumer income x

SOCIOCULTURAL DIMENSION

Education level x

Lifestyle changes x

Social conflicts x

TECHNOLOGICAL DIMENSION

Scientific knowledge x

R&D policy x

New technologies x

ECOLOGICAL DIMENSION

Environmental policy x

Energy consumption x

LEGAL DIMENSION

Safety and hygiene x

Product Safety x

Labor legislation x
From the strategic profile of the environment analyzed above, we can observe

that the greatest strengths of the Corte Inglés are in terms of the political

situation, with the weakest points being those regarding consumer income,

since it is a company in which the majority of its consumers have a high income.

 Porter's diamond

LAFAYETTE

MARKET

LOCATION DEMANDING
CONSUMERS

CONSTRUCCIONE
S Y CONTRATAS,
SA

 Strategy, structure and rivalry between companies.

If we refer to department stores, there is no clear competition from Corte Inglés

within Spain. However, we find strong competitors such as Pull&Bear,

Mercadona, etc.
Abroad, you can find large companies that compete with you, such as Galeries

Lafayette in France.

 Factor conditions.

One of the main characteristics of Corte Ingles is the location and large size of

its centers, located in specific, very commercial areas.

Owning its own factories gives this large company greater flexibility and security

in different areas. One of the company's strong points is its brand image.

Since its creation, it has been growing and promoting very specific values both

for potential consumers and for those who have never purchased at its centers.

 Conditions of the claim.

Consumers are increasingly demanding, which is why the Corte Inglés group of

companies has had to follow a line of specialization in its products in order to

differentiate itself from its different competitors.

 Related and auxiliary sectors.

At this point we can highlight the company dedicated to construction,

Construcciones y Contratas, SA. This company has collaborated in the

construction of some of the El Corte Inglés centers.

5.ANALYSIS OF THE SPECIFIC ENVIRONMENT

Customers: El Corte Inglés has a very heterogeneous clientele, due to the high

rate of differentiation of its products that are offered in the different

establishments that are aimed at any segment of society.

The staff that makes up each center of the company is oriented towards

personal treatment and constant service to clients, betting at all times on

individualized attention. El Corte Inglés has a remuneration system to pay its

employees, in proportion to the sales they make, with the aim of promoting

greater involvement in the offer of merchandise to the consumer.

The success of El Corte Inglés lies in the ability to follow and incorporate the

latest developments and trends in the market into the company, which makes it

available to its customers who find in each shopping center the cutting-edge

and constant innovation of its products.

Competitors: According to the current Director of El Corte Inglés, the

company's true competitor is small businesses, which he describes as

“specialized or avant-garde businesses” that can offer quality or high-level

products.

El Corte Inglés' competitors currently focus on shopping centers that can rival

the group in the range and variety of products they offer.

Among its main competitors is “Carrefour”.

The “Inditex” group in fashion has been a tough obstacle for the distribution and

marketing of clothing in the company's shopping centers, which is why El Corte

Inglés launched a chain of stores called Sfera that is more similar to the

commerce model based in exclusive collections and trends in the textile sector.

In terms of food, El Corte Inglés faces competition from powerful national

supermarket chains such as Día, Mercadona, Lidl and Erosky.

To face this competition, El Corte Inglés strives to offer the best quality and the

best prices, working with fresh products and committed suppliers, with the

optimal treatment of merchandise, guaranteeing safety and customer

satisfaction.

In terms of computer products and household appliances we find companies

such as Media Mark and Worten.

The company itself: In this case it refers to the group of companies as a

whole, that is, both El Corte Inglés and the companies that make up the group,

Hipercor, Viajes El Corte Inglés, etc.

Suppliers: El Corte Inglés considers each of its suppliers as a collaborator with

whom it establishes a close relationship. With this, the constant search for the

quality of products and services is pursued, as well as adaptation to the

different demands of customers.

At the end of 2011. El Corte Inglés had 31,262 different suppliers who assumed

the ethical commitment implied by the Code of Conduct.

 Porter's 5 forces model

1. Threat of entry of new competitors: at this point we must take into account

whether we have new markets or participants that arrive with innovative

resources or capabilities to take over a portion of the market.

In this case, the entry of new competitors such as small businesses due to their

closeness to the customer and that tone of familiarity. And as major

competitors, there are other groups such as Lafayette, and Printemps (France)

or Harrods (Great Britain) that could confront “El Corte Inglés” although so far

they have not established themselves in Spain.

2. Rivalry between competitors: you should know that it will be easier for a

company to compete in a market where competitors are very well positioned,

there are numbers and fixed costs are high, because they will continually face

price wars. , advertising campaigns, promotions and new product entries.

The company's true opponent continues to be small businesses that can offer

quality or high-level products. The problem is that due to overcrowding, El Corte

Inglés merchandise does not stand out as much as in these commercial

establishments. This helps partly explain the growth in the number of its stores.

El Corte Inglés is trying to specialize as much as the competition.

However, testing your business strategy has shown that specialization, along

with diversification, is a formula that works. Furthermore, this is reflected in

shopping centers as a solution to competition.

The main competitors in terms of distribution groups are two: Firstly, Carrefour,

a French company that occupies the leading ranking both in the number of

hypermarkets and the surface area it owns. In second place is the French

company Alcampo, owned by the Auchan group. It restricts its activity to

hypermarkets.

3. Bargaining power of suppliers: A market will not be as attractive when

suppliers are organized as unions, have strong resources or can impose their

price and order size conditions. Furthermore, the situation will worsen if the

inputs they supply are key to our market, they have no substitutes or they are

few or of high costs.

El Corte Inglés considers each of its suppliers as a collaborator with whom a

close relationship is established for the exchange of ideas and proposals. With

this, we pursue the search for constant improvement in the quality of products

and services as well as their adaptation to the demands of our clients.

The El Corte Inglés Group has intensified its efforts to improve the supply chain,

implementing new processes and continuing with its commitment to raising both

the quality of its products and the degree of social compliance of its suppliers to

higher levels.

In this sense, at the end of 2011 there were 31,262 suppliers who had assumed

and signed the ethical commitment entailed by the Code of Conduct of BSCI

(Business Social Compliance Initiative), an organization to which the Group

belongs since March 2008. This initiative is added to the Business Principles of

the El Corte Inglés Group, which include an ethical code based on the principles

of the United Nations Global Compact, signed by the Group and its subsidiaries.

4. Bargaining power of buyers: The market will not be attractive when

customers are well organized, the product has many substitutes or is not

differentiated from others. Organized buyers are not advisable since the more

organization they have, the more their demands will be in terms of price

reductions, quality, services, among others.

El Corte Inglés has a heterogeneous clientele, since the high rate of

differentiation of the products it offers in its establishments is aimed at any

segment of society. The staff that makes up each center is oriented towards

personal treatment and constant customer service, betting at all times on

individualized attention. To this end, El Corte Inglés has a remuneration system

of commissions for its employees in proportion to the sales they make with the

aim of promoting greater involvement in the offer of merchandise to the

consumer. The success of El Corte Inglés lies in the ability to follow and

incorporate the latest developments and trends in the market into the company,

which makes it available to its customers who find in each shopping center the

cutting-edge and constant innovation of its products.

5. Threat of entry of substitute products : it is not attractive if there are real

or potential substitute products. Even more so if they are at lower costs or

technologically advanced.

In “El Corte Inglés” being a company that is not specialized in any specific

product, the substitute products are within the same company, so they do not

represent a loss for the company.

So we can conclude the following threats and opportunities:

THREATS

 Entry of new competitors with lower costs.

 Increase in sales of substitute products.

 Current economic crisis

 Slow market growth

 Change in consumer needs and tastes.

 Increased barriers and costly regulatory requirements.

 Increasing bargaining power of clients and/or suppliers

OPPORTUNITIES

 Specialize and diversify, creating new companies to compete with the

leaders of each sector (for example, Bricor, to compete with Leroy

Merlin).

 Loyal clientele

 New markets (Globalization)

 Industry segmentation

“El Corte Inglés” segments its market by creating different lines of business,

responding to the different needs of its customers. The Corte Ingles Group has

the following business lines:

 El Corte Inglés is today one of the world leaders in department stores

with a strong presence in the Spanish market and a presence in

Portugal. Since the founder of the company, Ramón Areces, acquired a

tailoring shop called El Corte Inglés in 1935, the company has

maintained continuous growth. The El Corte Inglés Group is the first

distribution group in Spain and number 40 in the world by volume of

sales. It is the European leader by sales volume and the second or third,

according to sources, worldwide behind Sears and very close to Macy's.

El Corte Inglés is considered the second family business in Spain and

the 66th in the world.

 Hipercor was born in Seville in the early eighties in response to a new

consumer demand. Since then it has established itself as one of the

Group's large chains.

 Bricor . The growth dynamics of the group and its adaptation to the new

needs of society have driven the creation of a new DIY chain called

Bricor. Bricor emerges as a large specialized store in which, in addition

to an abundant assortment and a very large number of references, all the

singularities of the El Corte Inglés group are offered, that is, the

guarantee of quality, customer service and attention personalized. It is,

therefore, an establishment where both the specialized professional

(plumber, painter, electrician,...) and the DIY enthusiast or the beginner

with little knowledge can go.

 Travel agency conceived in its beginnings as a division to provide

internal service to the group, Viajes El Corte Inglés has evolved to

become a subsidiary with a presence in different parts of the world.

Viajes El Corte Inglés has various types of agencies: specific for

companies, which offer a comprehensive service for business trips;

mixed (they serve companies and individual clients); implants (offices

that are located at the headquarters of the company or entity to which

they provide their services); and specialized agencies (congresses,

conventions and incentives), quality assurance in each event they

organize.
 Supercor supermarkets are conceived as a proximity format, with

business hours appropriate to customer needs and with the experience

and quality of El Corte Inglés. This business line emerges with the aim of

extending the food offering of El Corte Inglés supermarkets through a

specific format that includes perfumery and drugstore items. There are

also small sections of stationery, gardening, photography or telephony in

those establishments that meet the conditions for this.

 OpenCor is a chain of Convenience Stores, which means opening 365

days a year for 18 hours. OpenCor was launched on May 18, 2000, with

the inauguration of the first establishment in Majadahonda (Madrid).

Since then it has experienced rapid growth with the opening of stores

distributed throughout Spain.

 Sfera was born in November 2001 as a fashion chain that is committed

to quality, constant renewal and variety in its collections. Sfera is

conceived as a chain of stores specialized in fashion and accessories,

with a wide range of clothing for men, women and children, presented in

lines of formal fashion, sport-city fashion, and clothing for the weekend

and leisure. It also has its own collections of women's lingerie, men's

underwear and a special line for babies.

 Optics 2000 . The optical chain sells the main fashion brands that design

frames and sunglasses, in addition to offering a wide variety of services.

This company, dedicated to the marketing of products and services

related to vision and hearing, carries out its activities through its own

stores located within the El Corte Inglés and Hipercor shopping centers,

and in independent establishments. OPTICA 2000, which is present in

Spain and Portugal, was established with the philosophy of offering the

most professional service and the highest optical quality through the

marketing of leading brands. Within the OPTICA 2000 stores are the

main fashion brands that design optical collections (frames and

sunglasses). One of the characteristics of these establishments is the

wide variety of models they offer to the consumer, always in line with the

latest fashion trends.

 Information and communications technologies IT El Corte Inglés,

Investrónica and Telecor are the companies of the El Corte Inglés

Group that carry out their activity in the Information and Communications

Technologies sector. All three pursue the same objectives in terms of the

quality of management and service, as well as the permanent

improvement efforts that characterize their commercial and technical

activity.

 Insurance Brokerage, Insurance and Financial Company . The

subsidiary, which has an extensive distribution network, offers products

 such as life and accident insurance, savings, temporary and annuity

insurance, as well as pension plans.

 Other notable participations are the following: Most of the operations are

computerized through terminals that plant employees constantly use to

carry out sales, credits, adjustments, size returns and other sales

processes. Different Corte Inglés centers must necessarily be

communicated and connected through computerized technology. Corte

Inglés has a sophisticated and studied transport network that makes

possible great mobility in terms of all the products it offers in each of the

centers. Security of the centers: Surveillance cameras responsible for

transmitting problems and thefts that occur in the centers to a central

control body. So we could conclude that it offers security to the client.

6.INTERNAL ANALYSIS

6.1. SWOT MATRIX:

A. Internal analisis:

Weaknesses:

 Their prices are usually higher than the competition.

Strengths:

 They have a very wide variety of products and services.

 It is a very recognized brand.

 Advertising is excellent.

 Excellent customer service.

 Great quality of products and services offered.

 They have qualified personnel.

 Collect different products for different tastes in a single establishment.

 Return policy.

 Experience.
B. External analysis:

Threats:

 The existence of stores specialized in a single product or service.

 Due to the crisis, people buy cheaper products even if they are of poorer

quality.

Opportunities:

 They can specialize and diversify by creating new companies to be able

to face competition more directly.

 Being able to maintain a loyal clientele that trusts the brand is an

opportunity in the market and this gives the company confidence to be

able to try new products.

 Enhance brand positioning

 Expansion of the company, through the continuous opening of

establishments.

 Use of new technologies, website, internet sales, etc.

 MATRIZ DAFO
Debilidades Amenazas

Mayores precios Tiendas especializadas

Crisis

Fortalezas Oportunidades

Variedad productos y Especializarse

servicios Diversificarse
Calidad Clientela fiel a la marca
Publicidad Posicionamiento marca
Atención al cliente Continua expansión
Personal cualificado Nuevas tecnologias

 Resources, capabilities and strategic potential of the company.

TO. Resources:

We can divide resources into two groups: on the one hand, tangible resources,

which are the easiest to identify and measure, and on the other hand, intangible

resources, which are those that have no physical existence.

Within tangible resources we can subdivide them into physical and financial

resources at the same time. The physical assets that El Corte Inglés owns are

many. Firstly, it has a large number of buildings, strategically located and of

enormous dimensions. These buildings, in addition to their location and

dimensions, have a special, attractive and striking design, which encourages

customers to enter the establishment. They also have several transport vehicles

for their own products.

They have a huge number of products and services to sell, the business lines

that El Corte Inglés has are the following:

- Department store

- Hipercor Hypermarkets

- Supercor Supermarkets

- Opencor convenience stores

- Sphere

- Optics 2000

- DIY Bricor

- El Corte Inglés Travel Group

- Information technology and communications

- Insurance Brokerage and Insurance Company

- Financial

- Editorial Ramón Areces Study Center

 - Management of points of sale GESPEVESA, SA

Therefore, it has food products, fashion, optics, DIY, the latest technologies,

machinery, furniture, and offers travel, insurance, financing, etc. products.

As for financial assets, it has a large amount of monetary resources due to the

economic dimension of the company, the evolution of the turnover of the last

four years is reflected in the following graphs, and although we can see that it

has decreased, We see that even so the company's profit is very high (€15,778

million in 2011)

We can also subdivide intangible resources into two subgroups. On the one

hand we have humans, where we include the knowledge, training, experience,

etc. of the company's staff. As we have already said, one of the strengths that

El Corte Inglés has is the training of its employees and the experience that the

company has. Furthermore, if you go to an El Corte Inglés establishment you

can see for yourself the motivation of the employees, this is mainly due to the

fact that the greater the sale they have made per month, the greater the
commissions and therefore the greater the salary received, in addition to the

good work environment in which they are.

On the other hand, there are non-humans, among them we include the

technological ones where we highlight the company's website, and the excellent

sales they make online, trying to ensure that the distribution is carried out in the

minimum possible time and in the best conditions. to always satisfy customer

needs. And the organizational resources where we highlight the prestige of the

brand, product and services offered by the company, and the reputation it has.

B. Capacities:

The capabilities that the company possesses are the result of the combination

and coordination of its resources.

As functional capabilities, we highlight the customer service offered by El Corte

Inglés, the quality control that its products and services undergo, the financing

services offered by the company to facilitate purchases, the product return

policy and assistance. technique it offers. The distribution and marketing of your

products and services.

As cultural capabilities, we highlight the employees, who are the most valuable

resources of El Corte Inglés, for their capacity, commitment and desire to

improve. The ability to innovate and thus be able to improve productivity,

increase profitability and face competition, for this they develop innovation

programs. And the most important of all is marketing. The advertising

campaigns of El Corte Inglés are known to everyone, they are carried out

through all possible media and a high percentage of the profits obtained are

allocated to them.
C. Strategic potential:

Once we have defined what the resources and capabilities of El Corte Inglés

are, we can know what its strategic potential is.

El Corte Inglés has been expanding in different sectors and different

subsidiaries have emerged, through mergers or the creation of new companies.

This great growth has been produced in order to reduce risks and maximize

benefits, the wide variety of sectors in which it works, its efficiency and the trust

generated by a large prestigious company like El Corte Inglés have made it

possible.

He wanted to show a little the key to his success. To do this, they have

allocated a large part of their budget to expensive advertising campaigns, which

have always been very effective since, in addition to selling the product, they

sell the trust of the brand.

Another characteristic that distinguishes El Corte Inglés is the importance that

the customer has for them; The company takes great care to satisfy the client

and provide them with all the possible comforts. For this, it offers great

guarantees, numerous payment methods, different customer information

centers, easy accessibility, etc.

El Corte Inglés has never wanted to be left behind, which is why it has currently

entered a new market: online sales. You have created a page where your

customers can find all your products and services without leaving home.

7.COMPETITIVE ADVANTAGE AND COMPETITIVE STRATEGY

Once the internal analysis has been carried out, we proceed to continue with

the analysis of the competitive advantage that the company has and from there,

what competitive strategy it uses.

 Competitive advantage

We can say, with everything analyzed above, that the company has a

competitive advantage in product differentiation, since the products and

services they offer are perceived as unique to customers due to the quality they

present, and therefore customers They are willing to pay a higher price.

A. Sources of product differentiation:

A company can differentiate its offering to customers in a large number of ways:

-Product characteristics: El Corte Inglés offers products that its competitors also

offer but differentiates them in terms of post-sale and pre-sale services,

availability of products and services, forms of financing, delivery, etc.

-Market characteristics: We highlight the personalized touch that the company

gives to its products regarding the way they are presented, the placement of the

products in the establishments, and the packaging. The location and design of

its establishments is also a source of differentiation.

-Characteristics of the company: it is a source of differentiation for El Corte

Inglés in that it highlights the way in which it relates to customers since

satisfying their needs is one of its basic objectives.

b. Competitive conditions in which it operates:

Competitive conditions are favorable for El Corte Inglés because customers

attach great importance to the company, knowing how to recognize that they

offer superior quality to other companies that are part of the same sector, and

with this they have earned customer loyalty.

Furthermore, it is difficult for other companies to imitate El Corte Inglés, since it

is already a company known for the quality it offers in its products and services,

and the prestige and value of its brand is very difficult to achieve, if not

impossible. since it carries out large advertising campaigns and this makes its

brand highly recognized.

c. Risks of differentiation advantage:

The main risk of the differentiation advantage is the price, this risk has been

increased by the time of crisis that we are experiencing in Spain. Some

customers have had to stop buying certain products at El Corte Inglés because

their purchasing power has decreased.

It can also reduce the appreciation of the product or service it offers and for this

El Corte Inglés is continually carrying out advertising campaigns. Competitors

with a segmentation or differentiation strategy can be a risk for El Corte Ingles

because they offer specific products and perhaps customers looking for a

certain product turn to those competitors.

 Competitive strategy

Once we know that the competitive advantage that El Corte Inglés has is

product differentiation, we can say that the competitive strategy carried out by

this company is oriented towards differentiation .

It is characterized by high or medium prices, higher than those of other

competitors. Specifically, the differentiation is broad, and what El Corte Inglés

seeks is to create a high added value that customers perceive, even if the price

of its products and services is somewhat higher.