Premium Denim industry overview The origin of denim jeans had place in 1874, but the premium jeans concept was popularized by Calvine Klein in late 1970’s. Since then premium denim market has been encountered alternately sales growth and slowing down following fashion trends changes, but remains until today highly fragmented industry. Currently Porter’s 5 forces model of premium denim industry is characterized by low entry barriers as there is low initial capital required and high margins and returns. That’s why even if this sector is already saturated, still encounters new players entrances. Bargaining power of denim fabric suppliers is low due to the low margins and intense competition.
Notwithstanding increasing dividends and a moderately stable share price, the home improvement retail industry remains to struggle due to the fragmentary world wide economic complications. Throughout 2009 Home Depot recorded expenses as much higher as well as the drop in sales. While Home Depot the company is very strong, the drop in sales and net earnings brought fourth some restraints until the economy shows signs of improvement. With this in mind The Home Depot, Inc. initiated strategies in the fiscal year 2008, to help minimize losses while maintaining a strong customer base. Which in turn may have the company to increase their credit programs for consumers with the intention to increase sales.
Although this is the case, there is always the potential for other businesses to come in and try to gain the competitive advantage for itself. By combining the café’s specialized offers with modern technology improvements, the business will enhance its image as a well established organization as well as broaden the capacity in which it serves its customers. Part 1: Porter’s Five Forces Analysis One of the unique facets of continuing my grandfather’s café is that there is generally low buyer power. In most urban areas café shops are located on every street corner. The town of Beulaville, NC is a small with a population of 1,067 (Wikipedia 2011).
How has Aurora Textile performed over the past four years? Be prepared to provide financial ratios that present a clear picture of Aurora’s financial condition. Exhibit 1 shows Income statement of Aurora Textile Company for the fiscal years 1999-2000. As mentioned in the introduction, Aurora had remained main efficient plants by reducing inefficient operations, but its sales show downward trend and in 2002, it decreased about 40% to compare performance in 1999. Due to the fact that Asian and other foreign textile manufacturers have been exported aggressively and consumer preferences are requiring higher-quality products with minimum defects, like other firms, Aurora tends to produce small amount of yarns produced with minimal period and provide to customized markets.
Although, the products are categorized as premium-priced and high quality and economies of scale, due to the small size of the company, cannot be realized, production and distribution costs are relatively low. This results in gross profit margins of up to 69% in Greece, 50.35% in Spain, 49.24% in Puetro Rico, and an average gross profit margin of 37.6%. So far, this strategy has worked out well for the company. Genicon is operating in 32 international markets, from highly developed to emerging markets, all around the world. Neither different market environments, disparities of economical development, political and legal situations, dissimilar demand and buying behaviors, nor cultural distinctions in the respective countries tend to hinder the success.
| 2. BRIEF SUMMARY OF CASE SITUATION Business or Industry Description Blue Nile had grown to become the world’s largest online retailer of certified diamonds and fine jewelry. | Blue Nile’s Current SituationBlue Nile reported $302 million in 2009. In 2010 Blue Nile management was concerned about the lingering effects of poor economic condition in the United States on the diamond jewelry industry and how it should pursue expansion in international business. | 3.
Starbucks was hit hard, the net income was down nearly 70% and it also dealt with its first ever decline in quarterly revenues. CEO Howard Schultz suggested that Starbucks is following a well organize plan to rebuild the strength of the business through more developed operations. While declining sales and profits could be the main reason, because on the global recession, Starbucks share price showed more of a concern about the company’s future. Starbucks problems could have also came from several other factors: Could Starbucks expansion resulted in too much store mass in a few metro areas. Growth of competition, not just from other coffee restaurants but from big-time fast-food restaurants like Krispy Kreme, McDonalds or Dunkin Donuts.
Shoes, athletic (except rubber or plastics soled with fabric upper), manufacturing. Vinyl upper athletic footwear manufacturing. Friday, February 24, 2012 2 Major Economic Characteristics of the Industry • Billion dollar industry • This market is beginning to decline somewhat, however experts expect there could still be some small bursts of growth occasionally. • Characterized by having a small number of large players. Friday, February 24, 2012 3 Industry Driving Forces • Fashion trends (+) • Change in society (healthy lifestyle) (+) • Changes in consumer sports preferences (sport popularity) (++) • Changes (rise) in manufacturing costs (--) Friday, February 24, 2012 4 5 Forces Model Substitute Products (of firms in other industries) M Suppliers of Key Inputs M Rivalry Among Competing Sellers Buyers S W Potential New Entrants Friday, February 24, 2012 5 W 5 Forces Model: Rivalry STRONG • Strong because industry is shrinking in the U.S. •
Supplier Power (SIC 3861) is low. Equipment components are specialized and likely not many customers. Threat of Substitutes is medium/high due to many options including theme parks, sporting events and live theater. The cost of these substitute products may be prohibitive to many if consumers enjoy movies due to their relatively low cost. Rivalry Among Existing Firms (SIC 7812) is low.
Redesign ‘Rebranding Pepsi Campaign’ 1. Campaign title and time/date of the campaign: “My Pepsi, My Healthy, My Energy” Campaign, March 2012 2. Situation Analysis: PepsiCo faced waning sales due to the worsening US economy, economic slowdown, the global financial crisis, and plunging stock markets. Moreover, the company noticed that the US consumers’ preferences were shifting to cheaper and healthier drinks and that people were cutting down on their spending on beverages. April 28, 2011 (Bloomberg) -- PepsiCo Inc., the world’s largest snack-food maker, reported a 27 percent gain in first-quarter sales, bolstered by purchases in international markets.