VANCL Analysis
VANCL: Problem
Within the period of 2007 to 2009, two major retail companies emerged in China: PPG Apparel (Shanghai) Co., Ltd. and VANCL Technology (Beijing) Co., Ltd. Though both had similar business models, VANCL was able to excel and profit in places where PPG Apparel suffered tremendously. These included creating a successful supply chain with effective quality control, adopting a variety of improvement measures to ensure a positive customer experience, and shifting most of VANCL’s advertising dollars towards internet marketing. Though successful when first established, PPG eventually collapsed in late 2009 due to their inefficiencies in such areas. Owner of VANCL, Chen Nian stated that VANCL has passed its most risky period and is now within a steady phase. However, though the road ahead may seem safe there are many risks to take into factor. With the future of online apparel in China constantly shifting, VANCL needs to consider whether or not their currently business model will continue to be successful or should evolve with customer needs. Specifically, they need to decide on which ways they can continue to grow as a company while still reigning in profits.
Alternatives
As a well-respected and established retailer in China, VANCL’s alternatives for growth can be narrowed down into three specific directions. The first is to continue their current business model while penetrating new market segments. This involves using their current forms of marketing to attract an audience they did not previously reach. The second alternative is to create a new retail format directed towards their current market segment. Such an alternative would allow for VANCL to embrace a new marketing strategy towards existing customers to keep them interested in VANCL’s products. Finally, VANCL has the opportunity to create a new retail format directed specifically at a new target market. This alternative might even include launching their product line globally.
Within the period of 2007 to 2009, two major retail companies emerged in China: PPG Apparel (Shanghai) Co., Ltd. and VANCL Technology (Beijing) Co., Ltd. Though both had similar business models, VANCL was able to excel and profit in places where PPG Apparel suffered tremendously. These included creating a successful supply chain with effective quality control, adopting a variety of improvement measures to ensure a positive customer experience, and shifting most of VANCL’s advertising dollars towards internet marketing. Though successful when first established, PPG eventually collapsed in late 2009 due to their inefficiencies in such areas. Owner of VANCL, Chen Nian stated that VANCL has passed its most risky period and is now within a steady phase. However, though the road ahead may seem safe there are many risks to take into factor. With the future of online apparel in China constantly shifting, VANCL needs to consider whether or not their currently business model will continue to be successful or should evolve with customer needs. Specifically, they need to decide on which ways they can continue to grow as a company while still reigning in profits.
Alternatives
As a well-respected and established retailer in China, VANCL’s alternatives for growth can be narrowed down into three specific directions. The first is to continue their current business model while penetrating new market segments. This involves using their current forms of marketing to attract an audience they did not previously reach. The second alternative is to create a new retail format directed towards their current market segment. Such an alternative would allow for VANCL to embrace a new marketing strategy towards existing customers to keep them interested in VANCL’s products. Finally, VANCL has the opportunity to create a new retail format directed specifically at a new target market. This alternative might even include launching their product line globally.
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