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Tommy Hilfiger

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Tommy Hilfiger
Tommy Hilfiger Case Study: EC 2102
This essay it will examine the economic, social and political issues that shaped Tommy Hilfiger on a global environment. First it will investigate why Hilfiger decided to sell internationally rather than concentrating on the domestic market and secondly it will analyse if operating globally affected the prices for Hilfiger’s merchandise. Analysing the prices will lead to a conclusion which will reveal if it has created any problems for the Hilfiger’s organisation.
‘In the United States clothing sales in general have been growing less than 5 percent per year, much slower than in foreign markets’ (Daniels et al, 683:2009). This is evident if you look at the clothing industry figures from 2011 to 2012. In the United States growth was 1.1 % in the men’s clothing industry (Barnes, 2013) and compared to a European country, for instance, Sweden, the growth percentage was 3.9% in same industry and year. However, according to the Tommy Hilfiger group (2012:6), ‘Sales of luxury goods in emerging markets have increased rapidly, even as the sales in the U.S and Europe slowed’. This highlights that the demand for luxury items in the United States and the developed countries in Europe are reducing therefore, emerging markets with growing economies are more likely to consume luxury goods. To support this, the growth in China increased in which, ‘retail sales rose 9.1% in 2003, while disposable income rose 9.3% in urban areas and 4.3% in the county side’ (BBC, 2004). In addition, the men’s clothing industry in China had a growth rate of 8.6% in 2011 to 2012, which illustrates again the high demand for luxury goods. Furthermore, ‘Hilfiger began only with a men’s line, but its men and women’s clothing each account for about half its sales’ (Daniels et al, 683:2009). Therefore, for woman’s clothing, the estimated growth figures in an emerging market, in this example, Brazil, are set to grow 6.2% from 2013 to 2014 (Barnes, 2013). It is clear



References: Agarwal, S & Ramaswami, S, (1992) ‘Choice of Foreign Market Entry Mode: Impact of Owenership, Location and Internalization Factors’, Journal of International Business Studies, 23, (1), First Quarter. BBC (2004) ‘China’s growth hits six-year high’. Available at: http://news.bbc.co.uk/1/hi/business/3412069.stm. Accessed 15th March 2013. Barnes (2013) ‘Barnes Report’, Worldwide Women’s Clothing Stores Industry, pp. 1-99 Barnes (2013) ‘Barnes Report’, Worldwide Men’s Clothing Stores Industry, pp Brown, D & Swanson, L, (2003) Challenges for Rural America in the Twenty-First Century. The Pennsylvania State University Press. Daniels et al (2009) International Business 12th, Environment and Operations European Union (2012)‘Europe in Figures’, Eurostat Yearbook 2012, 2012 Edition, pp. 108. Ferrel, O & Hartline, M, (2011) Marketing Strategy, South Western, Cengaged Learning Jain, S (2006) Emerging Economies and the Transformation of International Business: Brazil, Russia , India, and China (BRICs) . Edward Elgar Publishing Limited. Jones, J & Wren, C (2006) Foreign Direct Investment and the Regional Economy, Ashgate Publishing Gilpin, R (2001) Global Political Economy: Understanding the International Economic Order Jiatao, Li & Guisinger, S (1992) ‘The Globalization of Service Multinationals in the Triad Regions: Japan, Western Europe and North America’, Journal of International Business Studies, 23, (4), pp.1-22. Papaioannou, M (2006) ‘Exchange Rate Risk Measurement and Management: Issues and Approaches for Firms. South Eastern European Journal of Economics. PVH (2011) Annual Report, ‘We Grow Powerful Global Lifestyle Brands’ Tommy Hilfiger Group (2012). ‘Corporation SWOT Analysis’, Market Line, pp. 1-8. Tommy Hilfiger (2012) ‘Tommy Hilfiger’ Tommy Hilfiger (2013) ‘UK Tommy Hilfiger’. http://uk.tommy.com/Polos/206000,en_GB,sc.html. Accessed 21st March. Vikas,S, (2011) ‘Industrial Relations in BRIC Nations : A Study’, Asia Pacific Journal of Research in Business Management, 2, (6), pp.135-157 Weele, A (2005) Purchasing & Supply Chain Management: Analysis, Strategy, Planning and Practice, Thomson Learning. Women’s Wear Daily (2008) ‘The Fibre Price Sheet’, 196, (91)

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