...1. Imitation – Zara faces a LOW threat of being imitated. Competitors could potentially imitate the quick response system and adapt their production line to trends in the market. Imitation is feasible, however Zara’s advantage comes from being a pioneer in the quick response system. At the time of the case competitors such as: H&M follow a different strategy. H&M produces cheap via outsourcing, ahead of time taking advantage of economies of scale. Zara is currently at the frontier of quick fashion, so it will be challenging for competitors to imitate it. 2. Substitution –Zara faces LOW threat from substitutes, because there are literally no substitutes for clothes. There should always be demand for clothes, because clothes do not have infinite lifetime and fashion changes each season helping creating high demand. WTP is thus not endangered, 3. Slack - Zara faces a MEDIUM threat from holdup. Due to being part of large conglomerate: Inditex it may become a victim of inefficient management. Also, as Zara continue to grow, it will not be able to benefit from its advantages: the central logistics and vertically integrated supply may lead to increase in costs: shipments from Spain to other continents may increase costs and lower WTP. 4. Holdup – Zara faces a LOW threat from holdup because it would be difficult for suppliers to extract value from Zara (there are many suppliers from which Zara can choose from). Furthermore, Zara owns most of it supply chain so it does not need to...
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...Gina Garza Sustainable Fashion Sustainable fashion also known as ‘Green,’ has been successfully promoted in the past years to become the new black. This is a new trend that will hopefully prevail not only for a season but also for years. If people keep supporting it, it could possibly prevail forever. As technology has developed the planet Earth has been deteriorating slowly. This new concept supports and promotes the idea for people to be environmentally conscious. The idea is to care for the place where we humans live. Green is now everywhere. When you go to the market to buy groceries you can find that there is sustainable packaging that will integrate to the planet after its use. Now people take their own cloth bags to carry the products that they purchase so they don’t use plastic bags. This has become a fashion as well. To be more environmental friendly, why not use sustainable clothes? Clothes are one of the major necessities that a human may have. People can look fashionable, in style, and support the planet at the same time. The nonprofit Sustainable Technology Education Project (STEP) defines eco-fashions as clothes “that take into account the environment, the health of consumers and the working conditions of people in the fashion industry” (West). Sustainable fashion is designed to be completely environmental friendly. This whole movement complements a larger trend of "ethical fashion," and according to the May 2007 Vogue appears not to be a short-term trend but...
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...The company use machine that can produce bulk products at one time. With that, the company is able to reduce its overhead costs. The business is doing very well and the owner, Miss Amira, is very confident that her current strategy will ensure the sustainability of the business. In 2009, the business started to experience slump where the gross profit decreases year by year which leads to losses. Miss Amira begins to panic as the business might not be able to continue its operation at this point. She conducts an emergency meeting with the management to discuss the problem. Miss Ernie, the general manager, has been assigned to find the root cause of the problem. Her findings show that the company’s strategy has become rigid due to technology advancement. The competitors begin to use high technology in their production. They manage to offer cheaper with high quality products. Some of BestWear customers begin to switch their preferences to other competitors. Miss Ernie suggests that they should follow what the competitors do by using high technology machine which will involve high cost. After think thoroughly, Miss Amira suggests that the company should focus on producing youth fashion since they are the generation that prefer fashion compared to the brand. For this solution, Miss Amira wants to adopt turnaround strategies by outsourcing the production in order to reduce costs. Required: a) Briefly explain the strategy adopted by BestWear Sdn. Bhd. for the past fifteen years...
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...1.1 Introduction This study examines the factors that lead to small business failure in Johannesburg. Chapter 1 includes the background of the study, the aim/objective of the study, the key concepts and a scope of the study. 1.2 Background of the study The fashion industry is a globally competitive industry that presents challenges when initiating small start-up fashion businesses. Stanley Stasch (2010:3), however, highlights the need to develop small businesses as they contribute positively to the economy by creating jobs that alleviates a portion of the poverty in the country. In South Africa the clothing manufacturing sector has undergone major changes as it needs to compete with mass produced imports from low-wage earning countries as...
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...Youth and Fashion Thanks to a combination of technological innovation and developing global economies, “fast fashion” is now ubiquitous on the high street. A one-two punch of low prices and targeted advertising, in particular, has stimulated the boom of a teenage market, one that can stay up to date with the latest runway trends at “pocket money” prices. Today’s youth views shopping as a necessary and exciting task. And unlike previous generations, this emerging demographic has learned that “fast” is the only way to consume clothing. Negative Aspects of Fashion Though importance of fashion can not be neglected in todays society it has certain drawbacks too. Moral Values: Fashion does not preach ethics. Every new fashion or trend is promoted and advertised in such a manner that people (especially teens) cannot avoid it. They don’t bother whether it is moral or immoral. Economical: Fashion is often associated with promoting capitalism. Fashion is least rational; people buy new clothes when old are still wearable. They discard old clothes just because they are no longer fashionable. Fads of Fashion: Most of the fashion trends are very short-living. They come and go within few months. These are called fads of fashion. The true fashion consists of style, but people who have little awareness of fashion follow fads rather than making their own style. Harmful to Health: Certain fashion trends are harmful to health. Fashion has made teenagers extremists. What could be more shocking...
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...UGB247- Responsible Business Report on Corporate Responsibility ‘Fashion Retailing in Europe’ Laura Wallace: 1083579942 Module Leader/ Tutor: Mark Winter 15th May 2015 Word Count: 3,296 1 Contents 1.0 What is Corporate Responsibility? Page 3 2.0 Key Issues of Corporate Responsibility Page 3 2.1 Issues Relating to Outsourcing Page 4 and 5 2.2 Child Labour Page 5 and 6 2.3 The Use of Animal Fur and Environmental Issues Page 6 and 7 3.0 Best Practice Within the Sector Page 7 3.1 Primark, Compensation and Utilitarianism Page 7 and 8 3.2 H&M, Child Labour and Deontology Page 8 3.3 M&S and Virtue Theory Page 8 and 9 4.0 Recommendations Page 9 4.1 Responsibility Auditing Page 9 4.2 Education Page 9 and 10 4.3 Making a Stand Against Animal Fur Page 10 5.0 Conclusion Page 10 6.0 References Page 11 and 12 7.0 Appendices Page 13, 14, 15 and 16 2 1.0 What is Corporate Responsibility? Corporate social responsibility (CSR) is “about businesses and other organizations going beyond the legal obligations to manage the impact they have on the environment and society.” (Lea, 2002) In recent years, the fashion retailing sector in Europe has gained a lot of media interest over its irresponsibility to society and its employees. Some companies which have been under scrutiny around this issue include: Primark, Zara and H&M as well as many other brands which are increasingly popular...
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...of the largest clothing retailers in the world, Zara underwent immense growth over the past decades. It was founded in 1975 in Arteixo, Spain, by Amancio Ortega and Rosalia Mera. After a humble yet successful start, the founders soon found potential to optimise operations and decrease lead-times for their collections. The vertical integration of the supply chain gave Zara the opportunity to have new pieces in store in a matter of two weeks. This model is what made Zara grow over the years and what has made it a serious competitor in the current fashion retailing industry. Currently, Zara is part of the Inditex group and operates more than 2.000 stores all over the world. It has subsequent online outlets in most countries it operates in. In terms of sales, Zara managed to grow 8% to $19,7 billion. $0,5 billion shy of their closest competitor, and industry leader, H&M. Yet, an impressive $3 billion more than the next most successful fashion retailer Uniqlo ($16,6 billion) (Loeb, 2015). Zara’s current marketing activities are fundamentally...
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...H&M Case Study H&M is a Swedish retailer in fashion apparel industry and was founded in 1947 by Erling Persson. The fashion apparel industry is often regarded to be one of the most difficult branches to operate in, due to short product cycles, volatile demand and fierce competition in an increasingly globalized world. Mass-market pioneer in fast-fashion business Structure: 1) Name model 2) Mention why and/or when to use 3) Analyses PESTEC * Political factors that affect businesses include new legislation such as the national minimum wage and setting tax rates such as VAT or Corporation Tax. * Economic factors that affect firms are inflation and unemployment, interest rates and exchange rates (if importing or exporting goods abroad). * Social factors that can affect businesses include fashions, tastes and trends, and also demographic factors such as the ageing population of the UK. This has seen the rise of what is called the 'grey pound' – an increased number of wealthier older people with a disposable income. * Technological factors consist of the rapid automation of factory and industrialised work, or the worldwide increase of retailing online, e-commerce. * Environmental factors that affect firms are mainly concerned with being sustainable and being ethical. Examples of these issues are the recycling of used products, whether products are bio-degradable and the disposal of industrial waste. * Competitive factors is concerned...
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...many external factors affecting the fast fashion industry most importantly in H&M’s case is the transportation cost and price of oil | External factors change in the markets of production. Raw material prices have increased; cotton prices for example almost doubled in 2010. H&M has to adapt to changing conditions but always in accordance with their business concept – to offer customers fashion and quality at the best price. | There is a mix of external shocks in the fast fashion industry: * Economic slowdown * Energy costs (oil price) * Employment level * Change in regulations * Logistics (i.e. shipping time) * Transportation cost and time (H&M owns design but do not own factories therefore it is importing most of its goods from china which results in high transportation costs) * Use of IT * Raw material price fluctuation (e.i: cotton’s price have doubled up in 2010) There is a mix of external shocks in the fast fashion industry: * Economic slowdown * Energy costs (oil price) * Employment level * Change in regulations * Logistics (i.e. shipping time) * Transportation cost and time (H&M owns design but do not own factories therefore it is importing most of its goods from china which results in high transportation costs) * Use of IT * Raw material price fluctuation (e.i: cotton’s price have doubled up in 2010) ˡ (2011), H&M’s environmental objectives and sustainability policy....
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...Contemporary UK Fashion Industry Sustainable? The sustainability of the fashion industry is one of the major concerns facing many stakeholders in the sector. The UK fashion industry is increasingly facing a wide range of sustainability issues ranging from wastes generation due to increased production of fashion products to the use of toxic materials in the production of fashion items. In addition, the industry has also been faced with the problem of the growing problem of widespread use of unsustainable materials such as non-biodegradable materials that are not usually easy to recycle as well as the current energy consumption to the release of millions of tons of greenhouse gasses released during the manufacture of fashion and textile products. It is widely believed that many of these sustainability challenges and issues are largely attributed to the recent increased flow of a diverse range of fashion products particularly clothing and textiles in the UK market. For example, recent statistics indicate that that up to 3.2 million tonnes of fashion related products like clothing and textiles currently flow through the country each year . Generally, the environmental impacts of the fashion sector mainly include its high contribution to the climate change in the form of the increasing requirement of fossil fuels required in the generation of energy used in the industry such as in the production and manufacture sectors. For example, the intense production of fashion items to meet...
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...California, an individual's appearance is crucial because it is used to make a first impression. A person is judged by what they wear and how they look. For example, it is probable that many people would perceive a person wearing ratty clothes as uneducated and irresponsible while a person looking pristine in a designer ensemble is assumed to be intelligent and successful. In every city, there are multiple fashion brands with different styles and ranges of apparel and accessories. Every season, new styles and designs are created which influence society. It appears as if more types of clothing exist than the actual number of people. With so many different alternatives of fashion, the fashion industry is trying to please too many customers with variety. There are currently various styles to choose from, and the clothes people wear categorize or label them long before they realize it. The three fashion brands that will be analyzed extensively are Chanel, Nike, and Hot Topic. These brands have apparel but are completely different in their target audience. Chanel is a prestigious high-fashion brand; Nike is a popular athletic line; Hot Topic is musically and artistically edgier with a smaller target audience between the three. With these apparel brands, a person wearing each would be labeled or even stereotyped. One wearing a Chanel’s 2012 Spring/Summer ready-to-wear designer outfit with a white jacket, lambskin dress with pearls, and a glass pearl belt would be labeled as rich, successful...
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...I. Marketing Objectives This marketing plan aims to increase Wal-Mart’s inventory turnover ratio but at the same time, making sure that sufficient inventory would be available to meet demand, leading to increase in sales, particularly in the apparel category, by 5% in one year. Aside from that, this marketing plan aims to aid Wal-Mart: * To develop Wal-Mart’s own brand of new cheap chic apparel line * To improve advertising and merchandising support of the apparel category * To spruce up the store design concept in the in order to attract more customers II. Situational Analysis A. SWOT Analysis Strengths * Largest Retailer in the World Wal-Mart is considered the largest retailer in the world. It is the pioneer in the retail industry with the wide spread network of stores. * Loyal Customer Base Wal-Mart has a loyal customer base because it meets the expectation of customer by always delivering the goods at lower prices at compare to its competitors. It is a store where most individuals, who are on a low budget, still get to buy what they set out to buy. Wal-Mart’s low prices made the store a hero of some 45 million low-income Americans. Their loyalty, in turn, made the store a leader in almost every consumer category. * Everyday Low Pricing Wal-Mart is able to shift the low cost advantage to its customers and make the products available at lower prices, everyday. Lower prices were made possible by the company’s mastery of back-end operations...
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...TEACHING MODULE THE FUTURE OF FASHION DECEMBER 2010 This teaching module was independently written by the Aspen Institute Business and Society Program with the generous support of THE FUTURE OF FASHION: SUSTAINABILITY THROUGH THE LENS OF THE FASHION INDUSTRY* By: Jennifer Johnson & Gina Wu Companies across all industries are facing the challenges of business sustainability, debating how best to address these risky issues while also embracing their opportunities for competitive advantage. This Teaching Module uses the context of the fashion industry to discuss topics that are shaping the future of all industries. These topics include sustainable resource management, the challenges and opportunities of global growth, workforce management, and the role of ethical consumption in business. The fashion industry offers a compelling case study for exploring business sustainability issues. In the fashion industry, as in many industries, success requires highly developed sourcing, design, manufacturing, and marketing chains. Increasingly, success also means incorporating sustainability in resource and labor management, as firms realize that long-term corporate survival will depend on new ways of doing business. Climate change, resource challenges, new technologies and dramatic shifts in the global economy are already impacting the industry. The nexus of these concerns allows students to explore sustainability challenges while providing a framework for discussing new business...
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...|Professional Post Graduate Diploma in Marketing | | | |Chartered Institute of Marketing | | | | | | | |Candidate No: 13184461 | | | |Center Name: Management Development Centre (MDC) | | | | | |Subject: Emerging Themes | | | | | |Word Count for Discussion Paper: | | | |Task One: 555 ...
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...Sustainability 2014, 6, 6236-6249; doi:10.3390/su6096236 OPEN ACCESS sustainability ISSN 2071-1050 www.mdpi.com/journal/sustainability Article Sustainable Fashion Supply Chain: Lessons from H&M Bin Shen Glorious Sun School of Business and Management, Donghua University, Shanghai 200051, China; E-Mail: binshen@dhu.edu.cn; Tel./Fax: +86-216-237-3621 Received: 15 July 2014; in revised form: 15 August 2014 / Accepted: 19 August 2014 / Published: 11 September 2014 Abstract: Sustainability is significantly important for fashion business due to consumers’ increasing awareness of environment. When a fashion company aims to promote sustainability, the main linkage is to develop a sustainable supply chain. This paper contributes to current knowledge of sustainable supply chain in the textile and clothing industry. We first depict the structure of sustainable fashion supply chain including eco-material preparation, sustainable manufacturing, green distribution, green retailing, and ethical consumers based on the extant literature. We study the case of the Swedish fast fashion company, H&M, which has constructed its sustainable supply chain in developing eco-materials, providing safety training, monitoring sustainable manufacturing, reducing carbon emission in distribution, and promoting eco-fashion. Moreover, based on the secondary data and analysis, we learn the lessons of H&M’s sustainable fashion supply chain from the country perspective: (1) the H&M’s sourcing...
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