1. MACRO ENVIRONMENT
Social Forces
Two publicly controversial issues in the modelling industry are slenderness and racial exclusion. Models do much more than promote the sale of fashion. The model look promotes and distributes ideas about how women and men should look. Models “do gender” professionally in ways that connect with social positions such as race, ethnicity and class, and there are many critiques of fashion models and their gendered and racial meanings. Modelling succeeds on the criticism of the female body and the gap between promoted beauty ideals and reality. As women gain political and social ground, beauty ideals are held to higher extremes of slenderness and perfection. Another social force for clients is they face uncertainty of changing consumer desires as they are highlighting the importance of healthy lifestyles and body types.
Demographics

For fashion models age is a very strong factor in the selection process. Models are usually discovered between the ages of 12 to 20 by agents or scouts. High fashion modeling agencies often demand height and body shape requirements and have strong preferences for standards. With cultural diversification of the Western world, ethnic diversity is becoming an important factor for all people in the modeling industry. Moreover, various races and backgrounds are becoming progressively noticeable. Anita Norris needs to be aware of the changing demographic trends in the modeling industry

Technological Factors

With the internet and digital technology, global networks of scouts and agencies have unlimited access to clients and models around the world. Agents are able to snap pictures and videos on digital cameras, and they can email these as virtual casting packages to clients anywhere around the globe. The modeling industry has benefited considerably from the start of the internet. Many of an agency’s typical costs, such as mailing headshots, booking models and paying for photo shoots had been considerably reduced, and, as a result, agents and models both experienced increases in income.

Global forces
Global networks of scouts and agencies have unprecedented access to clients and models around the world.
With globalization, flexible manufacturing enables clothing to be quickly and cheaply produced in global commodity chains—fashion brand corporations start to outsource manufacturing overseas to decentralize production networks in developing countries.

1. MOST RELEVANT CONCLUSIONS FROM THE SWOT
Internal Strengths
-Anita Norris career as a scout at Wilhelmina agency-she honed her ability to identify and develop young quality talent and has been doing so for the past 11 years (proprietary knowledge)
-Has collected a roster of supermodel clients with strong agent-model relationships (loyal model/talent base)
-Obtains a strong track record with major fashion designer connections
-wide business lines to support revenue during the growth stage of the agency

Internal Weaknesses
-Small geographical reach with only one office-her size can make her less credible
-Workshop price point is quite high compared to competition (50%)
-Domestic models place a large strain of finances-fees total $6000
External Opportunities
-ANMM is a small modeling agency that is very new to the industry-workshop revenues projected to build synergy through growth to one-city expansion.
-ANMM has the ability to focus on the untapped potential within Southwestern Ontario-needs to focus on a particular segment by focusing further within her niche market or market segment to become a specialist. As she is a small fashion model business she would have greater credibility as a specialist and there is the advantage that she will develop a very deep knowledge and expertise within her market.
-Structure a deal with another agency as a shareholder and operate as a local agency with control. Larger agencies depend on smaller to expand geographically.
External Threats
-Strong competition within its modeling workshop revenue stream. Elegance Schools (ESI) is well established and provides top quality instructors for young models. ESI’s course offerings are 50% cheaper than those of ANMM.
-Hiring instructors may dilute her brand image
-Risk of poaching

2. If you were Anita, what would you do? a.) Vision and mission statement
ANMM’s mission is to become a leading Southwestern Ontario full service agency with a focus on ethical representation of a diverse cross-section of models who have received specialized training.

ANMM intends to grow from a small established London agency into a Southwestern Ontario firm. It will utilize a cascaded entry strategy of dominating the existing market within the next 2 years and then expanding into Kitchener-Waterloo-Cambridge in the 3rd year.

b.) Craft a set of corporate values
Quality-ensure satisfied model/client relationships
Empowerment-quality candidates to take initiative and provide the best
Diversity-anticipate trends and changing demographics in the modeling industry
Commitment-to identify and develop young talent (to the ANMM brand)
Collaboration-working to obtain greater resources, recognition and reward
Fun-having fun and celebrating small successes
Passion-putting the heart and the mind into the agency to get the best results
Leadership-to lead from the beginning and shape the future of the agency
Ownership-taking ownership of the agency and model success

c.) Craft and justify i. Short term strategic objectives
-Fully exploit the existing London market by attracting potential models and not losing them to competition
-Market workshops as a “specialized” service to make up for the high price point
- Set up a training program and hire professional specialized instructors to teach bi-weekly workshops to increase revenue stream
-Obtain higher levels of client/model satisfaction than rivals with a strong reputation
-Hire administrative clerk and 2 interns (no charge) at the London office to help manage commission line. Within the next two months at $16.05/hour.
-Hire a freelance photographer at $8,000 and market her model development from 100 to 150 people throughout London, thereby, increasing her revenue for the service to $67,000 (currently $22,500).
-Network throughout the Kitchener-Waterloo-Cambridge area to satisfy a demand for her model development. ii. Short term financial objectives
-ANMM needs to reduce its quick ratio by reducing the accounts receivable time frame. Currently it is unable collect the actual cash from its international clients on a timely basis (13.4 days); it will soon fold up, unable to pay its own obligations. It needs to be closer to the industry average of 0.47 days.
-Growth in revenues by increasing commission revenues to 40% in year 3 and 60% in year 4
-Growth in retained earnings-London agency (become shareholder) to invest $10,000 in the business stock, earning 20% compounded annually; she will then have $79,500 after 5 years (she can use this for a one-city expansion).
-A more diversified revenue base-sign more successful models to international agencies and market her consulting service while charging for speaking fees, add services that would be of interest to her model roster iii. Long term strategic objectives
-Wider geographical coverage than rivals
-Establish an office in Kitchener which is the central point of the Waterloo region (it has the highest population and portion below 15 years of age-prime for model talent).
- Hire unpaid interns for both locations to help with the simple admin tasks. Hire 1 full time administrator for the London office who can support the interns. Norris will be able to focus more on model development. iv. Long term financial objectives
-Increase annual growth rate to 35% by year 5
-Growth in commission revenues to 80% in year 5

d.) Two alternative strategies i. ANMM will utilize a cascaded entry strategy of dominating the existing market with her workshops within the next 2 years and then expanding into Kitchener-Waterloo-Cambridge in the 5th year. ANMM will fully exploit the existing London market by attracting potential models and not losing them to competition

ii. Focus on a market niche and particular segment. ANMM will sign more successful models to international agencies and market her consulting service while charging for speaking fees, add services that would be of interest to her model roster. Norris will advertise herself as being a reputable specialist within the model industry.

iii. The first strategy is the winner because Norris is operating with limited resources. It makes sense to look at a lower risk strategy first. ANMM is a small business. It does not want to get carried away with the excitement of new horizons and forget to fully exploit the existing markets before moving on. She may have a good reason for looking at new markets if her existing market has dried up or has undergone a down-turn. ANMM needs to remember that the further she moves away from her existing market, the risk and cost of marketing increases. This is because she has far more connections within her existing market and has far more information upon which to base her decisions.
As for the second strategy, it must make good business sense to pursue, and it is not without risks in itself. There is no guarantee that the larger competitors won’t see what she is doing and start to concentrate their own assets on your niche, especially if it looks profitable. You always need to monitor the market and be prepared to move to another strategy if necessary. There is risk associated with total reliance on a small market sub-segment.

e.) Implementation aspects of the winner strategy i. What needs to be done
Develop a shared vision about the market and how it is expected to change in the future.
Check her need to increase her customer base. Make an estimate of how many customers she needs in order to reduce to an acceptable level the percentage of total revenue accounted for by each customer.
Norris should ask for recommendations and referrals from existing customers; which then will form a substantial source of new customers. This can be done by regularly providing information brochures summarising her agency offerings. She needs to look for opportunities to develop new models, but retaining and developing more sales from existing young talent should be first priority. Developing more sales from existing customers is less costly than obtaining new customers.
Norris will offer workshops (self-image, wardrobe, beauty, photography and photo movement, runway, acting) bi-weekly with the help of professional instructors and interns. ii. Who is responsible for it
Norris’ ownership enhances the process by leveraging the unique talents of models. Supporting the plan involves gaining organizational commitment to the strategy being implemented (providing time to succeed, resource allocation, communication and the necessary skills to succeed). Norris must be adaptive in planning and recognize the essential role of continuous improvement, feedback, persistence, and corrective implementation. iii. What is the time frame
Dominate the existing London market with workshops within 18 months and expand into Kitchener in the 5th year. iv. What are the potential risks or problems during the implementation
One of the more critical risks is resource constraints, skills and competency gaps. Norris needs to be aware that the further she moves from her existing market the cost of marketing increases. There may be a problem recruiting the right candidates for the instructor position.

f.) Describe how to evaluate if the strategy is working or not
Analyze if the strategy will beat the market and if it is putting ANMM ahead of current trends. Does the strategy embrace uncertainty; it should be crafted with an uncertain, rather than predictable world in mind. Has the strategy been translated into an action plan. The strategy needs detailed action plans that translate goals into specific actions, behaviours, and incremental objectives for the Norris who is implementing the plan. Does the strategy tap a true source of advantage?
4.) Negotiating with the Toronto agency
In considering the offer made by the Toronto agency I would have them become a silent partner with ANMM. In this partnership the Toronto agency would not have any management responsibilities but provide capital and shares liability. I would use the agency’s capital for growth in retained earnings-London agency (become shareholder) to invest $10,000 in the business stock, earning 20% compounded annually; I would then have $79,500 after 5 years (I can use this equity for a one-city expansion).