Pretty Little Thing Report

This report analyzes the micro and macro environmental factors impacting Pretty Little Thing, a UK-based fashion retailer. It examines key changes in the UK fashion retail industry, including social, technological, and economic trends. The report also explores strategies and tactics for adapting to these changes, including the use of the Wheel of Retailing theory.

Pretty little thing fashion clothing
retailer

Table of Contents
INTRODUCTION...........................................................................................................................3
Introduction to Company and its operations ..............................................................................3
Key relevant changes within the UK fashion retail....................................................................3
Relevant Changes in Micro environment....................................................................................5
Strategies and Tactics in Adapting Changes ..............................................................................6
Strategies in order to meet micro environmental changes..........................................................7
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Retail theory is the practice of distributing consumer goods and services through various
multiple channels of distribution in order to earn profit. Apparel market industry has been
growing steadily over the years in UK (Badot and Filser, 2013) . Fashion retailers satisfies the
need of consumers by providing them goods which meet their requirement. Chosen company
under the report is Pretty Little Thing. It is a UK based fashion retailer which specialises in
selling women wear, foot wear, accessories and beauty products. It was founded in 2012 by
Umar Kamani, headquartered in Manchester, UK. The report will focus on how the respective
industry is operating and its regulations in micro and macro environment factors as well as
discusses issues identified in conducting PESTLE analysis.
Introduction to Company and its operations
Pretty Little thing is a UK based fashion retailer company which specialises in Women's
wear and aims at targeting womens of 16-34 years. It is owned by Umar Kamani and
headquartered in Manchester with its offices in London and Los Angeles. Company is owned by
Boohoo group and operates in UK, Ireland, Australia, US and France. It has a revenue of £300
million and has a good presence of stores all over the world. Brand became popular when
celebrities including Miley Cyrus were seen wearing this product range. Moreover company has
launched its mobile application for Android and iOS phone in UK market to target large number
of customers. In order to capture larger market share brand also starts targeting young girls aged
5-12 years (Baker and Saren, 2016). It has developed a good positioning in market and was
named as one of the to three fastest fashion growing companies by Hitwise. In 2018 it started
launching collection for sizes 6-28 to capture larger market share. For surviving in this fast
changing environment company has to carefully analyse micro and macro environmental factors
in order to provide according to existing trends and changes. Brand is facing significant
competition from TOBI, Atterley, Mod Cloth.
Key relevant changes within the UK fashion retail
Retail sector is the largest growing private sector, providing employment to the
individuals in UK. But with the increasing globalisation, there is a high demand lifestyle and
expectations of the consumers who have led to the drastic change in Fashion retail industry
(Bodie, 2015). Respective company should analyse the issues in macro and micro environmental

factors which the company should identify and thereby produce products according to the
changing trends. In order to identify changes in macro environment, PESTLE analysis has been
described below-
 Social Environment- Because of the increasing demand of the customers, due to wider
availability of products in the market it has led customers to buy product from one store
which has led respective company to open more stores and start increasing its presence
online in order to meet requirements of customers. Customers in UK who are high
fashion conscious demands products similar to those of the celebrities, this has
increased pressure on the respective company to provide such products to the customers
with high quality in order to capture larger market share.
 Technological factor- Technology is a very important factor affecting the growth of
fashion retail industry. It is because of the higher advancements and technology it has
forced companies to adopt to recent technology in order to survive in this competitive
environment. Because of the increasing globalisation, IT, internet and with the increased
use of mobile devices it affects sales, marketing and consumer choices of products. In
order to cope up with this technological issue respective company has adopted its own
mobile application as well as started its online presence in a way to attract customers on
a large scale. Customers have greatly accepted this application and have started placing
online orders which saves a lot of time and cost for the company (Brigham and et. al.,
2016).
 Economic Environment- Pretty Little Things should consider the economic growth of
the country in order to properly supply products in the country. This factors includes
interest rate, inflation rate, rate of employment and many more. Analysis of this factor
allows the respective company to know whether their product will be affordable in the
market or not. Economic environment in UK keeps cahnging but has a issue regarding
unemployment level. This issue can be resolved as the respective company can hire
employee at a low labour cost which will lead to decrease in its products prices.
Moreover it has also identified a problem with Britishers who have decreased sales in
products of the respective company because of the depreciation in their pound value.
Company has to analyse this features carefully before supplying products in the market.

These are the macro environmental factors which are outside the control of the company and
hence should be analysed properly so that necessary actions could be taken in order to attain long
term sustainability in market.
Relevant Changes in Micro environment
Micro environmental factors are the internal factors which has a direct and immediate
bearing on the company. They are more inter linked with the company than the macro
environmental factors. It affects the business strategy, decision making and performance of the
company. Changes in micro environment can be understood as a change in customers behaviour
and attitude as well as suppliers behaviour and the level of competition within the specific brand.
Respective company should analyse behaviour of such intermediaries and should produce
products according to their demands. Factors within the micro environment are discussed below-
 Change in consumers attitude- With the increasing globalisation and wide spread
technological advancements it has led the customers to demand various products
according to their change in culture, attitude and beliefs. It is the major factor which is
driving the fashion industry to provide goods as per the customers requirements. In order
to sustain in this competitive environment, company should produce goods according to
customer's needs so as to capture larger market share and generates maximum revenue
for the company (Hayes, 2018).
 Suppliers- Suppliers plays a major role in distributing goods to the retailer so that
products can be supplied at a proper time to the consumers without any disruption. As the
company acquires products from various suppliers which leads to changes in prices of
products and may provide products at a later time than demanded. For this respective
company should analyse changes in suppliers behaviour and take necessary actions to
maintain proper supply of products in market.
 Competitors- Pretty Little Thing faces stiff competition from TOBI, Atterley, ModCloth
and many more companies. Company should analyse competitors strategies and products
so as to make certain improvements in their own products. There is a intense competition
from the companies because of their online presence in the market and provides high
quality products at an appropriate price with high discounts and offers. This makes the
respective company to plan certain strategies to gain competitive advantage (Hristov and
Reynolds, 2015).

Strategies and Tactics in Adapting Changes
Their are certain changes in fashion retail companies analysed from micro and macro
environment factors which forces retailers to adopt to certain changes any provides high quality
products by meeting customer requirements and thereby attaining maximum profitability for the
company. By analysing the macro environmental factors it has been analysed that there are
issues in technological factor, social factors and economic condition of the country. In order to
cope up with this changes, respective company has adopted some strategies and tactics which are
mentioned below-
Social Changes- With the widespread of globalisation, there is lot of change in consumer
demands and tastes and their preference is according to their culture, beliefs and attitudes.
Various strategies been formulated by the company in order to cope up with this changes are
discussed as-
 In order to overcome changes in social behaviour of customers, respective company has
adopted customer focussed strategy by providing products according to customers
demands.
 Pretty Little thing should adopt Differentiation Strategy which aims to distinguish a
product from its competitors. Company aims at providing fashion products according to
culture and beliefs of specific customer segment.
 By analysing the political environment it has been analysed that there is a stable
government in UK which implies that respective company should adopt retail practices
by providing products on a large scale in order to meet customers needs and enhance
profit margins (Klaus and Nguyen, 2013).
Technological Changes- In order to cope with the technological changes respective company
adopted various strategies and tactics which are as follows-
 Pretty Little thing can increase its online presence by promoting its products on social
media tools so as to enhance product awareness and increases profit margins for the
company.
 In order to cope up with this technological issue respective company has adopted its own
mobile application as well as started its online presence in a way to attract customers on a
large scale.

Economic Changes- In order to cope up with economic changes in country , Pretty little thing
has adopted strategies to overcome issues and generate more profit margins for the company.
 As with the change in UK economy, during the recession period company should lower
down the prices of its products by adopting cost leadership strategy which provides less
expensive products at a good quality in order to capture larger market share.
 Issue regarding the unemployment level can be avoided by hiring of employees at Pretty
little thing at a minimum cost so as to reduce price of the product and attracts more
customers towards the company (Mackellar, 2013).
Strategies in order to meet micro environmental changes
In order to overcome the changes analysed in micro environmental factors, respective
company has adopted to certain strategies such as the company can adopt to competitive pricing
strategy which analyses competitors prices for its products and then company can lower the
prices of its products but not sacrificing with the quality. Moreover the company can provide
products according to the changes in consumers behaviour towards the attainment of
organisational goals. This would assist the company to capture larger market share and create
brand awareness in the market.
These are the various strategies which the company has adopted in order to cope up with
the changes and issue in macro and micro-environment analysis.
Use of Appropriate theories
Their are various changes in business environment factors so as to cope with this changes
and issues faced, Pretty Little Thing should adopt appropriate retail theories to understand the
concept of retailing and attain significant position in market. Pretty Little thing should adopt
Wheel of Retailing theory which is discussed as follows-
Wheel of Retailing
As because of the influences of the external factors, it is affecting the retail sector the
most. This theory discusses that retailers should understand the concept of retailing to maintain
effective position in market for a longer period of time (Nepal and Jamasb, 2015). In context to
this some steps are mentioned below-

Source: The Wheel of Retailing, (2019).
Step 1 Establishing and Penetrating in market- In this step, new retailers entry in market with
low price, low status and low margins. Prices are low because of innovative cost cutting process.
These helps in attracting competitors if entry barrier is low. Under context of Pretty Little Thing
can come in market with low price for attracting large number of customers. As it is fashion
company which provide variety of products to their consumers. This leads in generating high
profits through cost cutting in market. As individual prefer that industry which provide good
quality with low price. This model helps company to capture large consumers along with
goodwill in market (Pantano, 2014).
Step 2 Expanding the market- It is second step where market gain experience through first step
in which they come up with low price and low profit margin. The retailer of Pretty Little Thing
can expand their customer base for purpose of increasing, increment in market share and gaining
maximum profit margin. In order to increase customer base, they can use various mechanism. In
most of time, business use targeting segment of consumer for their consumer base (Ryan, 2012).
As retailer of Pretty Little Thing enter with low prices and later than target particular segment of
people. It produces products as per need and demand of customer as small segment has been
targeted.
Illustration 1: The wheel of Retailing

Step 3 Stabilized business model attracting margins- It is third stage of Wheel of retailing
where organisation is already in established position and earn margins. Pretty Little Thing can
earn maximum margins and it keeps on expanding their business. This leads to attracting more
number of customers which ultimately increases goodwill and brand of organisation. In this step,
demand and supply is more as it is starting through niche market. The other competitors analyse
and prepare strategies for penetrating market and enterprise. Thus, there is more possibility for
Pretty Little Thing to earn profits by supplying goods and service timely to consumers to fulfils
their need and demand (Rafiq,Lu and Fulford, 2012).
Step 4 Entry of another retail competitor- It is last stage of Wheel of retailing where Pretty
Little Thing can bring high quality products for market or adding more services or moving into
good market locations for targeting other segment. Here, enterprise add more operations and
facilities such as extra labour, warehouse and expertise for manufacturing products which leads
more expensive of goods. Through this service and product, they can be considered as high cost
service retailer in market. This is done for recovering fixed cost quickly and have break-even at
early for generating profits. As prices of products are high which create opportunity to other
retailer to enter and penetrate market.
RECOMMENDATION
From above analysis, there are some recommendation given to Pretty Little Thing for
improving themselves in order to sustain and survive in market. As need and demand of
customer changes frequently so business need to cope up with it and make plan accordingly. It is
recommended to business to make use of social media platforms in order to promote its products
and increase customer awareness. There are various changes in terms of social, economic and
factors which should be analysed by Pretty Little Thing and make analysis accordingly for better
outcomes.

CONCLUSION
From the above report it has been concluded that retail organisations are increasing at
greater extent, therefore generating employment level in the country. The report focuses on key
relevant changes within the UK fashion retail so that company should adopt certain strategies
and policies in order to overcome the issues analysed in micro and macro environmental factors.
In order to capture larger market share company should adopt effective practices and theories of
retailing so as to enhance their profit margins and capture larger market share.

REFERENCES
Books & Journals
Badot, O. and Filser, M., 2013. Re-enchantment of retailing: toward utopian islands. In
Consuming experience (pp. 175-190). Routledge.
Baker, M. J. and Saren, M. eds., 2016. Marketing theory: a student text. Sage.
Bodie, Z., 2015. Thoughts on the future: Life-cycle investing in theory and practice. Financial
Analysts Journal. 71(1). pp.43-48.
Brigham, E. F., and et. al., 2016. Financial Managment: Theory And Practice, Canadian
Edition. Nelson Education.
Hayes, J., 2018. The theory and practice of change management.
Hristov, L. and Reynolds, J., 2015. Perceptions and practices of innovation in retailing:
Challenges of definition and measurement. International Journal of Retail &
Distribution Management. 43(2). pp.126-147.
Klaus, P. and Nguyen, B., 2013. Exploring the role of the online customer experience in firms'
multi-channel strategy: An empirical analysis of the retail banking services sector.
Journal of Strategic Marketing. 21(5). pp.429-442.
Mackellar, J., 2013. Participant observation at events: theory, practice and potential.
International Journal of Event and Festival Management. 4(1). pp.56-65.
Nepal, R. and Jamasb, T., 2015. Caught between theory and practice: Government, market, and
regulatory failure in electricity sector reforms. Economic Analysis and Policy. 46.
pp.16-24.
Pantano, E., 2014. Innovation drivers in retail industry. International Journal of Information
Management. 34(3). pp.344-350.
Rafiq, M., Lu, X. and Fulford, H., 2012. Measuring Internet retail service quality using ES-
QUAL. Journal of Marketing Management. 28(9-10). pp.1159-1173.
Ryan, P., 2012. Apprenticeship: between theory and practice, school and workplace. In The
future of Vocational Education and Training in a changing world (pp. 402-432). VS
Verlag für Sozialwissenschaften, Wiesbaden.
Online
The Wheel of retailing. 2019. [Online]. Available Through: <https://www.marketing91.com/the-
wheel-of-retailing-concept/>.

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