Business Competitive and General Environment
Topic: Analysis of Porter's Five Forces and PESTEL of Fashion Industry
Company: G2000
Porters Five Forces
(1)Potential New Entrants
a. Bimba & Lola --- First established in year 2005, selling feminine office wear.
b. The ability of some brands to start ordering or selling products online has diminished the entry barrier in which huge investment is required to set up networks of shop outlets.
c. New entrants can easily enter the market as cost of facilities or equipment needed is low. Moreover, producers may have efficient and sufficient way of distribution of their products.
(2) Bargaining Power of Buyers
a. Target group of consumers are those working man and women whose careers are in the office and those with middle income and above. Most of the consumers are Chinese who usually spend between RM 200 and RM250 in average for everytime of purchasing.
b. Bargaining power of buyers is high because there are many other fashion brands selling similar products in the same field which allow consumers easily switch to other brand should there is any raise in price of G2000’s products. Furthermore, there are lots of substitute goods for G2000’s products where in addition spending of apparel or clothing just creates a small proportion of most consumers’ total expenditure while the frequency of buying clothes is low.
c. Apart from this, the development and advancement of technology enables consumers to compare the price, quality and style of products easily. For example, consumers may check for the price and style of products of G2000 and other brands such as Esprit, Zara and the like before they visit to the outlet shops of G2000. They may decide whether want to buy G2000’s products before they leave their home.
(3) Bargaining Power of Suppliers
a. Bargaining power of suppliers is low as G2000 won’t depend on single or two suppliers. G2000 has a lot of suppliers and it has its own designer. All the suppliers and designers are from Hong Kong headquarter.
Company: G2000
Porters Five Forces
(1)Potential New Entrants
a. Bimba & Lola --- First established in year 2005, selling feminine office wear.
b. The ability of some brands to start ordering or selling products online has diminished the entry barrier in which huge investment is required to set up networks of shop outlets.
c. New entrants can easily enter the market as cost of facilities or equipment needed is low. Moreover, producers may have efficient and sufficient way of distribution of their products.
(2) Bargaining Power of Buyers
a. Target group of consumers are those working man and women whose careers are in the office and those with middle income and above. Most of the consumers are Chinese who usually spend between RM 200 and RM250 in average for everytime of purchasing.
b. Bargaining power of buyers is high because there are many other fashion brands selling similar products in the same field which allow consumers easily switch to other brand should there is any raise in price of G2000’s products. Furthermore, there are lots of substitute goods for G2000’s products where in addition spending of apparel or clothing just creates a small proportion of most consumers’ total expenditure while the frequency of buying clothes is low.
c. Apart from this, the development and advancement of technology enables consumers to compare the price, quality and style of products easily. For example, consumers may check for the price and style of products of G2000 and other brands such as Esprit, Zara and the like before they visit to the outlet shops of G2000. They may decide whether want to buy G2000’s products before they leave their home.
(3) Bargaining Power of Suppliers
a. Bargaining power of suppliers is low as G2000 won’t depend on single or two suppliers. G2000 has a lot of suppliers and it has its own designer. All the suppliers and designers are from Hong Kong headquarter.