Burberry company
Burberry company is a manufacturer and marketer of men’s, women’s and children’s apparel, accessories and fragrances located in Britain; it has branches in many parts of the world. In 1856, Thomas Burberry founded the brand. In 1909 there was the opening of its store in Paris. During the first war, Burberry provided apparel and equipment to the armed forces. In 1920 Burberry become the public quoted company for the first time while in the same year Burberry check registered as a trademark was introduced as a lining to the coat. In the 1940s, during the second world war, Burberry supplied the British army with a range of military apparel and accessories, including the trench coat. The company continued in providing various wears to Britain’s. In July 2002 the company was listed to the London stock exchange following an initial public offering. In 2004 it launched the first transactional website in the United States. In 2008, the company formed a joint venture to establish Burberry Middle East with headquarter in Dubai. In 2010, Burberry became the first luxury brand to join the Ethical Trading Initiatives; it also forms a joint venture in India with Genesis Colours. In 2011 the company created a joint venture in Saudi Arabia with Fawaz Abdulaziz Alhokair & Co, transferring five stores from franchise operation.
C.E.O, Ms Ahrendts learned about Burberry that-move faster than you could ever fathom; you have to quickly adapt to the global and technological economy changes for you to continue operating smoothly. Secondly, never forget where you came from; you have to keep on checking your foundation as you focus in the future. Thirdly, she talks of creating a unified branding vision-in house that brought effort inside. It focuses on total control and singular vision.
Licensing threatened to destroy the brand’s unique strengths. The company losses its focus in the process of global expansion. By July 2006, the company had about 23 licences around the world, each doing something different. Burberry was unable to identify its target group of consumers since it had uneven distribution and other policies in various countries. In the process, they lost focus, and most of their customers were now turning into new brands from their rivals. For them to solve this problem, they had to have one global design director.
By the group expanding its network in Japan which is the second world’s largest market for luxury goods, the company had not carried on its highest traditions of supplying quality trench coats to the country over a while. Japan consumers are increasing to seek high-quality items, and there is also more foreigner visit in the country. As a result, there was an increasing mismatched positioning in Japan resulting from high numbers of tourists arriving in japan each year which increased the sales in various stores.
To curb these problems, the company is using different strategies for its operation in Japan. There are plans and activities around communication of the brand targeting the consumers by offering them high-quality products. The company is opening several new flagship stores in key cities, making it to take out a series of advertisements in the prominent Japanese newspapers, focusing on its heritage. Secondly, the company is pursuing a strategy of cost-cutting and higher profitability as it seeks to achieve annual cost savings of £100 million by fiscal 2019. Thirdly it moves towards reshoring because its changes in a business model, leadership and evolving supply chain strategy making it an iconic British high-end clothing brand. The company continuously focuses on customers with restoring its corporate heritage and core brand values. With this strategy, there is an increase in revenues and brand values, which has enabled the firm to compete effectively.
Furthermore, improvement of product quality brand has been influenced by motivations related to market-driven strategies, like; the presence of a capital-intensive product, consumer product perception on quality and the proximity of production and design. Also, the company has adopted digital online shopping by clicking on a product and be redirected to the company’s leading site to purchase it. This strategy placed it at the top of the fashion categories, key players.
Generation of revenue; Burberry currently generates revenues of roughly £25m, and it aims to increase its earnings to £100m by 2017.secondly the company takes the products closer to the customers in the country. It has identified new stores for Osaka and three districts in Tokyo, thus expanding its store network while increasing online sales. Thirdly its sales goods at a little bit lower prices to customers in Japan in that Japanese shoppers and tourists take advantage of the weaker yen. one of the possible disadvantages of the company is that it focuses on reducing labour costs this might lead to the low payment of workers. Moreover, the company assumes all risks and costs of operation in Japan.
In summary, Burberry chose licencing strategy as a perfect way of gaining high market in Japan. The country has a high demand for luxury goods provided by her citizens and tourists. The company lost focus on its products resulting in a decrease in customers, and it was competing stiffly with Sanyo Shokai company, these made it to use some of the strategies discussed above.