Towards Multinational Growth & Sustained Success Essay Example

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Some established brands from Europe and the US may have a different view of the Asian market and decide to enter. The threat of substitutes for casual apparel is low, with unbranded apparel serving as a close substitute for a different target segment. A Value chain analysis reveals that value is created through design, procurement of materials, production, outbound logistics, branding and marketing, and sales and services. Production, brand owners, and sales and services account for about 90% of the value created, all of which are owned by Giordano. Giordano has a flat Organization Structure and invests in its human capital.

Giordano’s success factors and their applicability in other countries stem from their emphasis on customer satisfaction and their mastery of the '3T' approach – tangibles, task, and treatment. This approach includes market-driven and customer-focused designs, quick apparel development to minimize time to market, and capturing customer trends in their designs. Giordano's primary focus is on providing stylish and practical clothing of good quality that offers value for money. To ensure continued success, Giordano must integrate capturing customer preferences towards local and global fashion trends into its fundamental business model.

Giordano has previously adopted industry best practices and should continue to do so. Additionally, they should strive to become a trendsetter by creating a Giordano community and blogs. This will provide valuable insight into customer preferences. In order to expand into new regions, their design system and staff must be equipped with the skills needed for good design.

In terms of operations control and supply chain, Giordano has effectively implemented an information technology system and inventory control. They use forecasting to understand customer purchase patterns and

provide real-time demand information to production facilities and distribution network. Distribution centers have replaced back shop storerooms, and the integration of purchasing and sales functions has been accomplished.

The importance of operations control and supply chain management cannot be understated in any successful business model. Giordano must maintain this core competency and continuously update it with the latest technologies. Failure to do so would have serious consequences for the entire business. Giordano should consider outsourcing non-value added activities and focusing more on their core competencies.The apparel industry relies on both local and international trends. It adapts to the seasonal needs of various countries, customizing its supplies accordingly. Quick incorporation of these trends is crucial to avoid having out-of-season stocks that would need to be discounted, impacting the profits of the industry.

The operations in a specific country depend on trade barriers, taxation systems, infrastructure, and managerial skills. Marketing and branding initiatives such as 'simply khakis', 'world without strangers', and 'no gimmicks, Giordano' have helped build customer confidence and establish a strong brand. Transferability is not an issue within Asian countries due to their high population densities and young population open to new cultures. However, in developed nations with aging populations and saturated markets, aggressive advertisements, brand promotions, and product customization are crucial. Giordano would need to adopt a different strategy to build a loyal customer base in new geographies, considering the cultural and economic influences of each area.

The buying patterns and disposable income of individuals determine the outcome. Each person has different needs and preferences. Giordano prioritizes customer service and embodies the principles of 'Giordano means Service' through three guidelines: 'unlimited try-on' policy, 'no questions asked' exchange

policy, and friendly service. Giordano continuously improves its retail stores by enhancing their size, ambience, and locations. It also embraces online shopping strategies and consistently assesses its services.

Transferability is crucial for the success of the apparel industry. Giordano should thoroughly analyze the influence of multinational companies on socio-economic stability, the skills of front line staff who interact directly with customers, and the spending habits of the local population. The selection of prime locations in major cities has a significant impact on Giordano's ability to attract more customers. To increase accessibility in new areas and achieve high volumes, Giordano should continue to pursue prime locations and seize expansion opportunities.

The Marketing and Branding strategies need to be essentially carried out in conjunction with this. When formulating a strategy, a primary consideration is assessing Giordano's core competencies and sustainable competitive advantages. It is important to maintain the core elements of Giordano's strategy when entering any country to ensure consistency in service and merchandise quality. Therefore, the strategy should remain intact in any country. However, it is crucial to acknowledge that the consumer may have significant differences in preferences towards the product and promotional mix. The consistent emphasis on simplicity, reflected in the style and design of its clothes, has been the hallmark of Giordano's success.

Giordano was an early adopter of online shopping in Asia, recognizing the importance of keeping up with global technological advancements. Although initially the sales were small, it was a significant step forward for the company. Lau, the company's representative, emphasized the need to focus on similarities between countries to facilitate the transfer of competencies and accelerate brand awareness. Despite the intangibility of services, a

strong global brand can provide recognition and reassurance. This necessitates coordinated marketing communications and consistent corporate design.

Giordano is striving to improve its operational efficiency by utilizing information technology. The company has already implemented systems that allow all markets to access real-time sales and inventory data. However, in order to further align with the just-in-time concept of production, Giordano should prioritize the development of web-enabled systems and trading capabilities. It is also important for Giordano to establish a consistent global brand, but it is worth noting that different cultures may have different associations with the brand. Lau, the company's CEO, should consider launching the growth program in countries that share a similar cultural background, as indicated in the attached xls sheet. The operations strategy should work hand in hand with marketing efforts, with a strong emphasis on minimizing internal costs and improving efficiency.

Peter Lau should concentrate on consolidating production using the traditional theory, which states that labor-intensive products should be produced and exported from countries with an abundant labor supply. In the highly competitive retail market, Lau recognizes the importance of service excellence as a distinguishing factor. Therefore, the company consistently invests considerable amounts in training and developing staff at all levels. It is suggested that Lau's focus on training should extend to all associated operations. Additionally, Lau should expand the business into emerging new economies such as the BRIC countries (Brazil, Russia, China, and India). To do this, it is recommended to initially establish strong brand awareness in these countries through intensive advertising campaigns.

The selection of retail center locations is crucial and should be based on the cultural needs of the local population. To make

informed decisions, it is recommended to consult the WDI and the IMD Competitiveness book. Lau should also consider economic factors such as the country's economic risk, GDP per capita, and GDP per capita growth. Additionally, facility location must take into account both local and federal political risks.