Business Report Sample: Colins Expansion
Name: Miranda Green
Title: Head of Research and Planning Department
Company: Colins, Ltd.
Address: Zafer District Cinar Street. No: 2 34520 Yenibosna, Istanbul,Turkey
Colins Ltd. is a company that owns and operates 670 clothing stores in 32 countries. The purpose of this report is to evaluate possible benefits and threats from the external and task environment that Colins Ltd. may face by its entering the US market, and opening an additional 50 clothing shops in New York, California, Chicago, Texas and Florida. The reason for current expansion is based on the realization of the strategic goal, which is creating a global clothing shop chain. The study is based on information collected from variety of sources: census data, statistics reports, and industry research. Colins Team analyzed possible external and task environment threats that the company may encounter, together with future profits from the expansion.
There are two main factors that influence Colins Ltd. expansion: the external environment and the task environment. Each of these areas is discussed below.
External environment consist of an analysis of 5 main components : legal, political, economic, social, global.
– Main legal areas that need to be studied are the occupational health and safety employment laws of the U.S.A. Therefore, it is necessary to ensure new clothing shops are safe for both employees and the public. Various US laws establish minimum wages, and training requirements, for clothing shops. It is expected that client will be knowledgeable of US legal requirements, and so they would not impose any additional opposition to the establishing of new clothing shops.
– Considering the economic element, it is necessary to evaluate the impact of the Global Financial Crisis (GFC) on the ready-made clothing industry. While America is falling into recession, the US Bureau of Statistics reports that textile and clothing industry incomes were significantly lower in 2012 than in 2011. In such circumstances, consumers are highly cautious with their spending. Therefore, it will affect clothing shops opening in US. Because Colins Ltd. sells a low-cost clothing assortment, GFC has less general influence on such business. Nevertheless, 2015 is expected to be more profitable for clothing industry.
-The sociocultural background shows that the growth of population in each state, where we plan to open shops, is high. However, the rate of growth in the textile and clothing industry is low. This data also points to relatively high competition in the US clothing industry. Therefore, Colins Ltd. should be ready to propose a competitive advantage to US customers in order to gain profit.
– The global element includes competitors developments outside of Colins Ltd. local markets with potential to influence the organization. The clothing industry in the USA is export oriented, so this will have some impact on the local competitiveness of Colins Ltd.
Task Environment consists of competitors, suppliers, and customers analysis.
– Future area of Colins Ltd. expansion (New York, California, Chicago, Texas and Florida) has commonly a younger population distribution, so Colins Ltd. should be focused on clothes that might be offered to this segment of population. Colins also consider that regions of US expansion are ethnically diverse. In respect to this, Colins needs to create flexibility in types of products proposed in stores. It is evident that a newcomer in the market needs to create a loyal customer base to ensure repeat visits, and attract more clients to their stores through good response, and effective marketing campaign.
– Expansion area online search showed 3,000 different clothing shops offering medium and low-cost clothes in the US expansion area. It is noted that there is a huge escalation of prices between male and female clothes. Female clothes are twice the price of males. Therefore, Colins Ltd. will focus on clothes for men, as the prices for these products are very competitive.
– Labor supply in the US clothing industry is recognized as one of the most multicultural, and include staff from a non-English speaking basis. Colins will take advantage of these opportunities, and appoint staff based on the ethnic profile of the expansion area.
– Colins ltd. will carefully select an appropriate supplier for the main material resources needed for their clothing business. It will be suppliers with the most competitive rate in the internet.
Conclusions and recommendations
The main purpose of the business plan was whether the establishment of clothing stores in the US region will be a good option for Colins Ltd. Based on the current analysis of mega and task environments, the conclusion is that future expansion to the U.S.A. market will be a profitable investment with future profits. The analysis also assessed a range of management and marketing tasks that it would be necessary to consider for the successful establishment of the company.
Consequently, subsequent recommendations are:
– the target clients should be young clients, with the accent on male customers.
– Colins will focus on high quality and low cost clothes.
– the products should be oriented to the multicultural population of the area.