Marketing HW

Environmental & Competitive Analysis

Developing a marketing environmental analysis for your business is a critical step in trying to understand external local, international and national forces that can easily affect the fashion industry as a business (Yüksel, 2012). The environmental factors happen to be outside the control of the business managers, but they can try to position their business so that it can take advantage of the opportunities while at the same time playing safe to reduce the threats that the environment is presenting. Carrying out a PESTEL analysis is the best way of understanding the major environmental factors. PESTEL stands for Social, Political, technological, economic, environment and legal. In this discussion, we are going to look at the factors and how they affect the fashion business.

Environmental Analysis

Political

The political, environmental factors are the government policies and actions that are impacting the fashion industry and the ability to trade with other countries or within the country. We have different policies that are affecting the fashion industry like the restrictions on the importation of certain fabrics that are found locally even when importation is cheaper (Fleisher et al., 2014). The policy is limiting the market and hampering the industry from obtaining raw materials at a cheaper price. At the local levels, we also have restrictions to carry out business in certain districts, and this affects the expansion of the business. It is important for the fashion business to understand what the political environment is calling for so that it can take advantage of the opportunities and minimize the threats.

Economic

Regarding the economic environment, it includes the different taxes and duties that the business is supposed to pay. We also have the fiscal decisions on certain things like the interests of the central bank together with the international exchange rates vitality (Fleisher et al., 2014). When a manager in the fashion industry is able to understand the economic factors, it will go a long way in helping them in the planning of the financial strategy for the fashion business. It is always critical to understand the economic policies of the country and other different countries so that they can be able to come up a good plan to improve performance.

Social

The social factor is the major factor that affects the fashion industry. It refers to the way the society is changing and adapting to the situations over a period (Yüksel, 2012). It takes place in the world, and it is important when making a business plan concerning the fashion business to consider all the social factors. We have religion, population demographics like gender, ethnic origin, and housing standards. Understanding the religion of people will help the fashion business determine what kind of materials the business is going to use in the making of the products. Population demographics will also help in the determination of the kind of designs to make. If the population is consisting of the majority of the children, then the children products should be more. If the lifestyle of the people is luxurious, it is easy for the industry to come up with premium products to maximize the revenues. The fashion business will require that they carry out a thorough social study to determine what is relevant to the business.

Technological

The new technology opportunities that are coming up each day is wiping away the old business methods and presenting the new business opportunities regarding production and marketing (Fleisher et al., 2014). It is important for the fashion industry to understand the impact that the next advances in technology is going to bring, and this will give the business a market advantage over the main competitors. It is important for the fashion business to look at how the communications are changing and how the business is going to take advantage of the emerging opportunities so that the business can reach a larger customer base. The fashion industry will be at the forefront to make the business more efficient and productive through exploration of the new technologies in the process of distribution and production.

Legal

The carrying out of any business is always under a strict legal environment (Fleisher et al., 2014). It is important for the business managers to understand the legal obligations that are relating to their business. Legal obligations could include the environmental restrictions, regulatory obligations, basic health and safety law and the regulatory environment. For the fashion industry, it is important to have a legal team that is going to play a vital role in ensuring that we have a clear understating of that we are required to do by the laws of the country.

Environment

Many operations in the world are now becoming increasingly aware of the environment factors concerning their business operations. Any business should be ready to consider the environmental aspects that relate to the business considering the effects on the wider and local environment (Christopher et al., 2004). The different attitudes that exist concerning the environmentally friendly materials are a major concern for many customers and can affect the consumer behavior. In the fashion business, it is important to show the customers that you are going green and not polluting the environment will help the business in attracting new customers. The business will have a team of environmental studies that will be helping the business in making the environmentally related decisions.

Competitive Analysis

The fashion industry has two categories that are currently high profile, and they include fashion designers and the models. However, we have numerous roles in the industry making the field more competitive. The competitors for the fashion business include the Companies that has specialization in the production of handmade jewelry and organic fashion designs since this is the area of specialization for the fashion business that we are targeting. We have various Companies that have already specialized in this area providing a stiff competition for the small businesses. There are several ways that the business could use to differentiate its products from the products of the competitors. The first is:

Price

The pricing of the products will be different from what the competitors are offering. Carrying out a market survey to determine the price of the competitors will help in the determination of the price that you are going to set for the customers (Christopher et al., 2004). Price cut for the premium market will help attract more customers.

Added value

The business will be offering some unique incentives including a free initial consultation or special money-back guarantee. The business will also be conducting an evaluation of what the customers need so that it can be able to create a special incentive that will help in the motivation of the customers. Buy-one-get-one-free will also be an important incentive for helping the customers to love the products.

Convenience

The business will develop an e-commerce website then go ahead to try and streamline the checkout process especially when it comes to the matter of the returning customers. It is important to make it easy for the customers to find information concerning the products and try to offer customer service via e-mail. For the shoppers who are in need of immediate answers, you can use the phone to pass the message.

Reference

Christopher, M., Lowson, R., & Peck, H. (2004). Creating agile supply chains in the fashion industry. International Journal of Retail & Distribution Management,32(8), 367-376.

Fleisher, C. S., & Bensoussan, B. E. (2014). Business and competitive analysis: effective application of new and classic methods. Pearson Education.

Yüksel, I. (2012). Developing a multi-criteria decision-making model for PESTEL analysis. International Journal of Business and Management, 7(24), p52.