1. Company’s Overview:
1.1 A retail company which was found by a Japanese gentleman is well known for its unique fabric. Its store name is Uniqlo. Everyone might have heard the name before because it’s already been known around the world. The meaning of Uniqlo itself is ” Unique Clothes’ The meaning itself is precise about their garments. The organization had started in a Japanese Village, and now the company had already opened 1,360 outlets worldwide. The company had open a total of 23 outlets in Singapore
1.2 Uniqlo opens its first doors in Singapore on April 9, 2009 at Tampiness 1Mall. The main reason why Uniqlo opens its first store in Singapore is a way to venture up in the globalization of UNIQLO. Singapore is the world’s definitive and most straightforward spot to do business. With its steady economy, Uniqlo’s business could expand its efficiency.
PESTEL
Their PESTEL Analysis is given bellow:
Politics:
Politic Grounds in Singapore is stable and safe.
In order for Singapore to implement a modern, clean, effective and safe country for its people and foreigners, the government upholds peace in an unwavering legal framework that incorporates punishment and death punishment. This kind of environment would give Uniqlo a safe investment for its company.
Economics in Singapore:
Singapore’s stable financial demonstrates the achievement of its improvement strategy. Throughout the years, the formation of Singapore’s exports has grown from labour-intensive to high value-added items. The services in the economy in Singapore grew as well.
The Singapore workforce is both cosmopolitan and universal, pulling in experts from everywhere throughout the world, who carry with them their broad learning and business expertise.
This person would help Uniqlo by helping the company to expand its business globally.
One of the principle explanations for the achievement is its vital geographic location. The government is a basic and dynamic player.
It claims the considerable beneficial resources. The labour cost of its neighbouring country is cheap and this could assists Singapore in saving their cost.
The dynamic environment that Singapore provides, gives the people the innovation that they want. And by adapting to this kind of environment, people who shops at Uniqlo would easily accept the company’s products
Social Culture:
Despite of its small island, the neighbourhood traditions and social culture in Singapore is one of a kind and a blend of different ethnic impacts. This has its roots in the nation’s history as an exchanging centre point.
The Social culture in Singapore is characterized by the distinctive ethnic gatherings in the city state. Chinese, Malay, Indian, and Western impacts are all tangible, providing a mixed type of traditions and local culture. The diverse culture in Singapore is reflected in the dialects that its person uses, including English, Chinese, Malay, and Tamil.
With the open social culture in Singapore, Uniqlo can have different types of direction for their sale. They could promote their items to everyone. Which is exactly shown from its slogan. ”Made for All”. Regardless of race, religion or their skin colour, anyone could get an outfit for themselves.
Technology:
Singapore is a developed country which everyone is involved in technology. Under the Category of the Generation Y age groups ( people who were born on 1977-1994) , they are the people who are highly in demand because they are well aware of the technologies around them. It allows them to multi-task, communicate and work collaboratively.
Uniqlo had already invented a high-technology, outer and inner wear that traps heat. They could target more people under the Gen Y group because these people could help them innovate and create more fashion designs for the company using the latest technology.
Environment:
Singapore’s pro-business, balance, transparent and adequate working environment furnishes organizations with a viable stage from which they can coordinate and deal with their local business activities. Additional to that, Singapore is an eco-friendly government. They encourage the people to Reduce, Reuse and Recycle their items instead of just throwing it away in the bin.
This is a good encouragement for Uniqlo, because Uniqlo is trying to reduce the impact on the environment in every step they are taking for the improvements of their company. Uniqlo also encourages its customers to donate their unwanted clothes to the company. The company will reuse the items to create a new product. But for the clothes that are still wearable, the company will donate it to the people around the world who needed it more than them.
Legal:
Singapore is strict in its lawsuits. The government will give a fair judgement to anyone who have acted the wrongdoings. Breaking certain laws in Singapore can come with obligatory decisions that still include canning, fine or jailed imprisonment.
Uniqlo does not need to worry about the unfairness of lawsuits in Singapore. They do not need to worry if there is anyone who tries to ruin their company name by blackmailing them or imitating their products.
Porter’s 5 forces
1. Threats of New Entrants:
The international fashion industry has traditionally been one of the most profitable industries in the world, achieving almost about US$2, 560 trillion (S$3, 129 trillion) in 2010 and there are no signs that the industry is slowing down, especially in Asia. This is because consumer is continuing spending on an upward trend. H&M is one of the companies which is currently expanding around the world. In Singapore itself, H&M have already opened 8 outlets in Singapore. With its latest designs for the modern trends and affordable prices, Uniqlo might lose their customer.
2. Substitutes:
Uniqlo is a retail store that sells casual wares. It can easily be substitute with a store that sells cheaper than Uniqlo. Or another company might have sell a nicer design.
We can use H&M as an example. H&M does have a design or patterns that may have attracted more customers. Their fabrics are comfortable to be worn even on a sunny day.
Another example that can be use is a store that is just under the void decks. Although their clothes are not branded, they do have casual wares on sale. It is a cheaper price than Uniqlo. Anyone could just get it between the ranges of $5 to $10.
3. Existing Competitors:
Uniqlo’s existing competitors are Zara, Top Shop, H&M and many more. Some of their items are cheaper than Uniqlo. They are Uniqlo’s competitors as they are also running their business in a retail industry. It is very easy for a company to rise in the business if they know what the current fashion trends are. If they are able to keep up with it, they are able to sell their products very easily. This is a threat for Uniqlo because Uniqlo’s strategy to be successful is not by following the trends. This is a disadvantage for Uniqlo because their competitors will be ahead of them and their business would be even better than Uniqlo’s. The competitors could make a smart move to increase their sales without anyone noticing it.
4. Buyer’s bargaining power.
Frequently releasing a new product:
The advantages of releasing a new product is that their customers might get it once it is release. But the there is a disadvantage for the customers, the customers might want to try out the new products, but because of the high prices in Singapore, it might be too expensive for them to purchase.
Secondly, e- commencing .Recently, Uniqlo had already launched its online shopping. The price difference are not far off form the prices at the store. Comparing to Qoo10 and E-bay, they provide a much cheaper prices for the customers. Some customers would prefer to shop for a re-sale item on a platform that sells at a lower price. This would be a loss for Uniqlo.
5. Supplier’s command of industry:
Uniqlo does not have its own factory to produce their product. Therefore, they rely highly on their producers. There are some disadvantages when Uniqlo relies heavily on its suppliers.
Firstly, In times of tight supply, the company may face some challenges to find a supplier that could accept their orders. Secondly, the suppliers may lose enthusiasm for attempting to compete for the business in the event that they see that a sole source circumstance is prone to hold on. On the off chance, the supplier might be facing some budget issues, the company may need to search for a new and dependable supplier. The supplier may have the advantages to increase the price due to the minimum amount of factory that can produce its products. This may increase labour cost to the company.
4. Strategy recommendations:
1- My first recommendation is that Uniqlo should create more designs for their adult customers. Most of their items are plain, some of which have cartoon designs and the contour of the flower petal designs. In order to step up their game against the other competitors, they should come up with a much more unique designs.
Recently in Manila, there is a complain about their latest design which was regarding about their limited edition T-shirts. They received a feedback from their customers saying that there was a lack of creativity and they are disappointed about it. It was because the design on the T-shirts is just Jollibee’s mascot and logo on it. In order to avoid this kind of problems in the future, the company could use the corporate entrepreneurship and innovation strategy. This would encourage the employees to take risk and share their creativity for the designs. This will give not only the top management to decide on the ideas but as well for the line management employees. This will make them feel that they have the empowerment to share their ideas with the company.
Other then bringing up a new designs for their products, Uniqlo should expand their product line. This brings to my second recommendation. By adding new products, Uniqlo might be able to increase its profits and it might also lead the company in a whole new trend. For example, sports items. Society nowadays are into sports. If Uniqlo creates a unique clothing line that is for a sport casual wear, they will be able to pull in more potential buyers.
Thirdly, Since Uniqlo has become a tremendous brand with a strong reputation, it is important for them to maintain its customer’s service and customer’s satisfaction. Obtaining a good standard of customer satisfaction is very important because when a customer is satisfied with the service, they’d probably be loyal to the company. They would not hesitate to shop with Uniqlo in the future.
My fourth recommendation for Uniqlo is uniqlo should provide a diversity workplace for their staffs. Last year (2014), Uniqlo had face a high turn-over rate among its part-time sales staff. A diversity workplace could help to prevent this type of incidents. By providing the employees a positive work environment for them, there will be a mutual respect among the workers. Secondly, there will be several types of opinions and perspective. Employees with a diverse background and experience will unite a variety points of view. The employees could suggest different types of solutions and methods for the issues. If they are able to do it, the qualities and best experiences of each individual can be bridled to uplift efficiency and convey better results.
Conclusion
In conclusion, Uniqlo’s owner, Tadashi has showed us that, it is okay to start from the bottom and slowly race to the top. With the right people and equipment, nothing is impossible. From a small store in a village to an international brand, Tadashi and his fellow team worker’s perseverance had helped him succeed in his business.
Now, Tadashi has plans to expand his business in the West Coast and East Coast of the United states. This is because he believes that by looking at the current situations, there is a huge potential for the company. In outlets that are in United States have been growing ever since. And that is what Tadashi wants to look forward to in the future.
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