Competitive Strategy and Business Performance. A Case in the German Clothing Industry

Seminar Paper , 1999 , 49 Pages , Grade: 1,0

Business economics - General

The clothing market environment is characterised by strong competition, low demand and declining margins. As prices deflate, many manufacturers are producing premium products. The present paper analyses the German clothing company JIL SANDER AG, which is then compared to BOSS AG and ESCADA AG. Despite their different size they all pursue a similar strategy to survive in a highly competitive surrounding: they built up a strong brand, diversify in other lifestyle segments and distribute their products through own mono-brand shops as well as through franchise partners.

The main task is to assess the performance of a company like Jil Sander in pursuing this strategy, especially considering its size constraints. This is done by qualitative as well as quantitative analysis in view of a environmental analysis, a financial analysis and a scenario analysis

Implementing this strategy, it should be kept in mind that it means less control over franchise partners and factories. The push is on to answer the 'management question' by strengthening the second management level, as a tight control over sales channels will not be possible by the person Jil Sander itself.

Content

1.Abstract

2.Introduction

3.The Case - An Overview
3.1.the German clothing industry
3.2.The Companies
3.2.1. Target company: JIL SANDER AG
3.2.2. Selected competitors: HUGO BOSS AG ESCADA AG

4.Qualitative Analysis
4.1.Broad Context: Pest Analysis
4.1.1. The political environment
4.1.2. Economic environment
4.1.3. Social factors
4.1.4. Technology
4.1.5. Impact Analysis
4.2.Industry / Sector Analysis: Five Forces
4.2.1. Intensity of rivalry
4.2.2. Supplier power
4.2.3. Distribution channels
4.2.4. Potential entry
4.2.5. Substitute products
4.3.Company Analysis: Ansoff Matrix
4.3.1. Current products for current markets
4.3.2. New products for existing markets
4.3.3. Current products introduced to new markets
4.3.4. Diversification of new products for new markets

5.Quantitative Analysis
5.1.Choosing the benchmarks
5.2.First glance on the financial statements of Jil Sander
5.3.Common Size Statements
5.3.1. Vertical analysis
5.3.2. Horizontal analysis
5.3.3. Cross-sectional analysis
5.4.Time Series Analysis and Financial Ratios
5.5.Operating Ratios
5.5.1. Overall performance
5.5.2. Working capital
5.6.Financial Ratios
5.6.1. Debt ratios
5.6.2. Liquidity ratios

6.Scenario Recommendations
6.1.Do nothing (Short-Term
6.2.Push Sales in Europe (Mid-Term)
6.3.Outsourcing production (Long-Term)

7.Bibliography

8.Annex

• College: Berlin School of Economics
• Course: Competitive Strategy and Business Perfomance
• Grade: 1,0
• Author: Almut Stielau (Author)
• Publication Year: 1999
• Pages: 49
• Catalog Number: V299255
• ISBN (eBook): 9783656957911
• ISBN (Book): 9783656957928
• Language: English
• Tags: MBA, PEST, Five Forces, Porter, Ansoff Matrix, German Clothing Market, Jil Sander, Boss, Escada, small company, size constraint, strategy, textile, apparel industry, benchmark, qualitativ, quantitative, analysis, AG