Business Environment Analysis: VF Corporation Expansion in France

This report provides an in-depth analysis of VF Corporation's business operations and its planned expansion into France. It begins with an introduction to business organizations and the business environment, highlighting the importance of understanding market dynamics. The report then delves into a detailed PESTLE analysis of France, examining the political, economic, social, technological, legal, and environmental factors that could impact VF Corporation's success. Specific factors such as the political stability, economic growth, social demographics, technological advancements, legal regulations, and environmental performance are considered. The report also includes background information on VF Corporation, its vision, and its values, and provides charts and tables to support the analysis. Finally, the report concludes with a summary of the key findings and their implications for VF Corporation's expansion strategy.

BUSINESS ORGANISATIONS
AND ENVIROMENTS IN A
GLOBAL CONTEXT

Table of Contents
INTRODUCTION ..........................................................................................................................1
Background to Business organisation.........................................................................................1
Background to the business environment...................................................................................3
Porter’s five forces......................................................................................................................6
Charts and Tables........................................................................................................................8
CONCLUSION ............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Business organisation can refer as an entity which is formed for the purpose of moving
on commercial enterprises. It is an action through which wealth is made by delivering quality
items according to the needs and wants of the customers. It goes for directing business by
assembling or manufacturing products and services as to keeping in mind the end goal to take
care of different demand of customers (Voegtlin, Patzer and Scherer, 2012). The major aim of
this project is to provide an appropriate data and information about the VF Corporation which is
an American apparel and footwear company. The VF Corporation is founded in the year of 1899,
in Greensboro, North Carolina. VF Corporation is planned to diversify their business operations
in other countries in respect to earn more profit and revenue by enhancing their customers base.
France is the place where VF Corporation is going to expand their business venture. At the time
of expansion, various kind of issues like competition, external elements, internal factors are
faced by organisation. These are identified by the analysis of external environment. Furthermore,
nature and types of specific aspects in in regards to VF Corporation is taken into proper account.
Background to Business organisation
A business enterprises is considered as a person or a group of people working together in
pursuit of the same commercial interest. The major purpose of each small as well as large
business organisation is to expand their business operations at global level in respect to attaining
more profitability and growth. VF Corporation is an American global apparel and footwear
company. The was incorporated in the year of 1899 and the headquartered of the firm is in
Greensboro, North Carolina. The company engages in the design, production, procurement,
marketing, and distribution of branded lifestyle apparel, footwear, and related products for men,
women, and children in the America, Europe, and the Asia Pacific. The company majorly
operates by four major segments such as Jeans-wear, outdoor or action sports, image-wear and
other. The controls over the 55 percent of the U.S. Backpack market with the Jansport, Eastpak,
Tmberland and North Face Brands.
Vision of the firm:
The major vision of VF Corporation is to grow by building leading lifestyle brands which
excite consumers around the globe.
Purpose of Values of the firm:
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The potential purpose of VF Corporation was to developed over the course of one year
through applying a thoughtful approach which involves input from more than 1000 VF
associates across the globe and external stakeholders as well as experts. The company is concern
on analysing all the factors of earning as to diversifying their business into a new area. The
company decide to expand their business in France as to enhancing their revenue and
profitability.
The company has around 58000 employees who are contributing their significant efforts
in the growth and development of the firm. It has market revenue of around 12.3 billion. The
new income of the firm is approximate 1.210119 Billion. The company is majorly operating in
clothing and accessories. Their major operations are conducted from America, Europe and Asia.
VF Corporation is a popular clothing and footwear company which is widely focused on
enhancing their business global level and provide high quality products and services to their
significant customers.
France is considered as a Sovereign state which is territory consists of metropolitan
France in Western Europe and several overseas regions and territories. The total population of
France is around 6.69 billion. France if considered as the seventh largest economy by nominal
figure of 2017 and tenth largest economy by the analysis of PPP figure. France was the world's
20th country by GDP per capita with $44,099 per inhabitant. France experienced standard
growth among the year of 2012 and 2014, with the economy expanding through 0% in 2012,
0.8% in 2013 and 0.2% in 2014, by growth picked up in 2015 with a growth of 0.8% and a
growth of 1.1% for 2016, to a growth of 2.2% for 2017 and to later reach 2.1% for 2018 (Worlds
top largest economies, 2017).
France is not only famous for its visitors attraction but also famous for providing
opportunities to the people or organisation who wants to expand their business operations at
global level. As a most developing country, businesses can easily grow with highly qualified
resources and area for diversifying the business (Scullion and Collings, 2011). The countries are
having custom of building up their own particular development and innovation through having
inventive techniques as to keeping in mind the end goal to get most extreme development for the
economy. France has just been set up themselves as an area for different multinational
organization. It is indispensable for the clothing or accessories businesses to think of extensive
variety of products and services as to fulfilling the desires of people within the market place.
2

(Source: The outdoor brand acquired by VF Corporation in 2011, plans to hit $3.1 billion
sales by the end of 2019.)
The company, owned by VF Corp with the share of (VFC, -0.40%), which represents the
revenue that rise more than 15% to $1.8 billion in the last year, and its operating profit rate
climbed for the fourth year in a row, to 13%. the company has aimed to reach at $3.1 billion in
revenues and 18% margins in 2019, fuelled by a bigger intensity on higher-income city dwellers
around the world.
However, France exports a wide range of goods and services and has an export to GDP
ratio which is close to 30 percent which is beneficial for VF Corporation. It means that the
company can export large number of goods and services to their potential buyers and gain more
profit and revenue. France is considered to be the largest exporter of agriculture and farm. High
export rate helps the firm in grow at global level.
Background to the business environment
The most ideal approaches to make authorized investigation subject to VF corporation
and republic of France by utilizing PESTLE (Murray, Skene and Haynes, 2017). It is known as
3
Illustration 1: The outdoor brand acquired by VF Corporation in 2011, plans to
hit $3.1 billion sales by the end of 2019.

one of the essential external variables those are influencing normal business activities inside that
specific country. A few fundamental part of these components are specified as follows:
Political factor: The political environment of France is stable and violence is
uncommon. In France the government is based on semi-presidential system which is analysed by
the French constitution. Up to 30 projects will be selected for the 2017 theme “Risk Reduction”
and will receive between €1 million and €3 million in start-up funding. France is a great degree
depending on trade and business with different countries. The ideal business atmosphere and
political strength which utilised to elevate responsible FDI inflows to this nation. They have
wanted to keep the corporate assessment 28% which is 33.33% at resent and a specific
contribution of 10.7% of the corporate tax liability. as it considered as one of the essential zone
of policies in France. The political circumstance is considerably more steady however influence
monetary and business condition of different organization. VF corporation can give real profit
and FDI scene is that specific country.
Economic factor: France's high organization impose is main considerations that can
prompt VF corporation to evaluate once before making extension arranging. Panelists
participating in the Focus Economics Consensus Forecast expect GDP to grow 1.9% in 2018. it
is having the capacity to win that much benefit as they have arranged. Annual inflation rate was
1.3% in 2017 and unemployment rate was 9.4%. GDP per capita (EUR) 35387.Any adjustment
in external request can prompt influence the nation economy circumstance (Lindberg, Voss and
Blackmon, eds., 2013). Their economy appreciates a low rate of expansion that used to adds to
bring down loan cost and improve acquiring power consistency. The business rate down to 6.7%
in first quarter from 2018 to that 7% in contrast with a year ago. VF corporation will put
resources into France that will also allows for good opportunity to unemployed individuals,
jobless people.
Social factor: Population in France is 67106161 as per index 2017, and the age structure
0-14 years as 18.53%, 15-24 years for 11.79%, 25-54 years as 37.78%, 55-54 year as 12.42%
and 65 years and above are 19.48%. Major cites population in PARIS (capital) 10.843 million;
Lyon 1.609 million; Marseille-Aix-en-Provence 1.605 million; Lille 1.027 million; Nice-Cannes
967,000; Toulouse 938,000. Religion based population is Buddhist 0.5-0.75%, Christian
(overwhelmingly Roman Catholic) 63-66%, Jewish 0.5-0.75%, Muslim 7-9% other 0.5-1.0%,
none 23-28%. VF corporation, France is a best monetary place for catching more clients.
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According to the statistical surveying, general spending made by France with aggregate of
£170000 million in 2018. Its populace is likewise developing at respectable rate and birth rate is
additionally at higher rate with 1.99 %. Most extreme populace implies that greatest number of
clients is probably going to accessible in focus for VF Corporation. The aggregate transfer wage
is 9€ per hour as per last index of 2016. There is now named as generally speaking interest for
VF corporation in France, there have been petitions made in connection to welcome VF
corporation to come and begin their business activities all the more adequately.
Technical factor: France is the technological expert It has been discovered that
innovation is continuously changing and for all global organization, for example, VF corporation
those are dependent on clothing retail business to make its merchandise required to keep reliable
in the market. Thermonuclear fusion which is considered as the source of solar energy subject to
great hope and abundant source. It is expected that France is to spend $1.8 billion on AI to
compete with U.S., China. There are top five countries as united states, china, japan, south Korea
and Canada are considered in technology index of France. It has been observed that VF
corporation organization is more depend of serving client by giving most extreme products and
services through websites or offering better client administrations case. The VF corporation
client have been guaranteed that they can ready to get more hey tech offering as the per coming
spending plan (Lindberg, Voss and Blackmon, 2013). The organization is having item
improvement guide offices to the clients and to investigate more in store innovation, for
example, Touchscreen, making instalment on COD and additionally on the web.
Legal factors: These are fundamentally finished up different administrative and law
determinants those are having negative and constructive outcomes on generally speaking results
of the market activities and future basic leadership. The minimum wage rate is with the
minimum wage at €1,4480.27 per month which is need to considered in legal factors. The It has
been discovered that as a result of endured race and common vulnerability has made most
extreme weight on nation and additionally client as a similar purpose of time. Some urgent
security and dangers that are looked by UK organizations while working in France. For example,
France's FDI stream had break all the record in 2017 by surpassing USD 3.5 billion according to
the official information organization. They are for the most part contingent upon outside
speculations. VF corporation can't have the capacity to get any trouble to manage strategies that
are influencing the general business. It can assist them with improving the financial state of that
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specific country and FDI manageability. From this time forward, these strategies won't have any
sort of negative ramifications of VF corporation budgetary and also moral manageability of the
nation.
Environmental factors: It is considered as one of the viable components that is impact
affecting the most recent fifteen years (Bansal and Hoffman, 2012). As per environmental
performance index France contains the 2 ranking, environmental performance index 83.95,
environmental health 95.71 and 76.11 subject to ecosystem in this context. Carbon dioxide
emission’s rose 3.6 percent over the targeted 447 million tonnes of CO2 emissions equivalent,
the ministry said. The carbon tax get increased by 30.50 euros ($35.81) per ton this year to 44.6
euros in 2018, 55 euros in 2019, 65.40 euros in 2020, 75.80 euros in 2021 and 86.20 euros in
2022. There was no mention of a target level for 2030.This has turned out to be more vital VF
corporation organization to make most extreme effect on every one of the angles those are
influencing the general nature and economy. This will give understanding into the France offices
that can tailors their help to upgraded all the more adequately by inviting VF corporation to
begin business in their areas. The greatest mindfulness with respect to condition prompted the
specific collection of create western country all the more definitely. Preservation act 1987 and
natural insurance act 1986 is should have been taken after to each organization that needs to set-
up their business.
Porter’s five forces
This refers as the most powerful tool for understanding the competitiveness of the
business environment and for analysing the best strategy for attaining profitability. This tool is
significantly used to investigate different level of rivalry inside an association and make business
strategical improvement (Kirton and Trebilcock, 2017). Analysing the threat to attaining
profitability and productivity while making any sort of strategy in respect to hold appropriate
change among market condition those are influencing the business. This structure is being
outline as appropriate devices and strategies with a specific end goal to pick up rivalry for
enhance the brand impale of the organization. It involves various elements which are associated
as below:
Competitive rivalry within the business: This is the most important element of porters
generic model (Porter's Five Forces. 2018). VF Corporation is deals in high quality clothing and
accessories, the company is widely concern on attaining higher competitive edge within the
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market place through satisfying the needs and wants of people. The company has large number
of rivals and the major competitor of the firm is branded clothing companies and countdown
businesses. As a luxury brand it is easy for the VF Corporation to entry into the new market,
because the company has large customers base. There are various laws like Reinforces existing
fundamental principles, confirms several case laws, introduces a number of innovation etc.
which are needs to be considered by the firm at the time of entering into the new market. The
major market barrier which has a huge influence on the performance of the firm as it is related
with the culture of France. VF Corporation is deals in luxury products and very much concern
on offering variety of products in France. The major obligation of the company is to analyse the
customers demand in France and provide most satisfactory products in respect to increasing the
profitability and growth.
Bargaining power of Customer: Customers are defined as the king of the market, and the
growth of firm is based on the satisfaction level of customers (Ferraro and Briody, 2013). This
component is mainly connected with the perception of the buyers as how they are attracted with
the price and quality of the product which are offered by the VF Corporation to their potential
buyers. While expanding business in new area company needs to consider the segment in which
they are expanding, so it is essential for the firm to analyse the perception of customers and
produce goods as per their choice and preference. In France people are more concern about the
quality than the price of product, so the company is producing high quality products and services
as to attaining high growth and development.
Bargaining power of supplier: It is essentially simple for the suppliers to increase costs
for the in the situation when their rivals are not able to fulfil the demand of customers within the
market place. The social request of clothing and accessories are more appropriate in regards to
attaining high competitive edge within market of France. Developing devoted suppliers whose
business is based upon the business. One of the lessons V.F. Corporation can analyse from Wal-
Mart and Nike is how these firms developed third party manufacturers whose organisation solely
depends on them thus creating a scenario where these third party manufacturers have essentially
less bargaining power compare to Wal-Mart and Nike. As a large business enterprises VF
Corporation has a wide number of suppliers who are available for analysing the market situation
and give right information as to producing more effective and reliable products.
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Threats of New Entrant: This is also an another essential aspect, which has a huge
influence on the operations of the firm (Crystal, 2013). It is more crucial and hard for
organisations or an individual to deal with higher level of competition to enter into a new
business segment. In France numerous industries are working in the different segments and there
is huge chance of entry a new rival, so it is essential for VF Corporation to analyse the complete
market situation before diversify the business into a new area.
Threat of substitute goods: This determined as the most powerful element which has a
huge impact on the operations of the firm in effective manner (Briscoe, Tarique and Schuler,
2012). It is basically connected with the matter of facts to analyse how people switch to the other
brand and its products. France is a metropolitan city and due to high tax rate the country is not
seems to be profitable. The country or its government is widely concern on gaining the attention
of various franchises as to attaining more profit and develop the economic base of country.
The decision of VF Corporation to expand their business in France if good as, the country
has high export rate which provide various benefits to the firm or its operations. It is one of the
most leading clothing or footwear company which plays effective role in developing the
economic condition of the country.
Charts and Tables
Keeping in mind the end goal to influence development of business into the France to
advertise, the critical angles should have been considered is different graphs that are speaking to
impose data from the most recent few years (Black, Morrison and Gregersen, 2013). while piece
of the overall industry development and soundness. One diagram is demonstrating different
contenders those are accessible in France. Every one of them are descirbed as follows:
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(Source 1: Growth of VF Corporation, 2018)
From the above graph, it has been demonstrating that all the pre-charge benefits that are
brought about by VF Corporation plc from 2008 to future estimation is being appeared. This is
fundamentally the up and coming arranging done by the organization. It will assist them with
making extension for the business ventures.
(Source 2: Growth measure of VF Corporate, 2017)
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Illustration 2: Growth of VF Corporation
Illustration 3: Growth measure of VF Corporate

(Source: Enrolment in pre-primary education is not universal, 2018)
From the above diagram, it has been indicating different organizations those are in charge
of producing adequate measure of offers from the diverse association in same section. The
development rate for different general stores is demonstrating greater chance to the specific
countries (Bansal and Hoffman, eds., 2012).
CONCLUSION
From the above given report it has been concluded that the major purpose of each
business is to expand their business at global level in respect to gaining more growth and
profitability. Issues related with development of business in different countries is should have
been considered before making any plan for expansion. External environmental factors must be
dissected before settling on any decision for business expansion. Some indispensable information
with respect to corporate assessment, approaches and contenders that are as of now maintaining
their business must be assessed legitimately so odds of getting most extreme development
opportunity can be improved.
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REFERENCES
Books and Journals:
Voegtlin, C., Patzer, M. and Scherer, A.G., 2012. Responsible leadership in global business: A
new approach to leadership and its multi-level outcomes. Journal of Business
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Murray, A., Skene, K. and Haynes, K., 2017. The circular economy: An interdisciplinary
exploration of the concept and application in a global context. Journal of Business Ethics.
140(3). pp.369-380.
Lindberg, P., Voss, C.A. and Blackmon, K.L. eds., 2013. International manufacturing strategies:
context, content and change. Springer Science & Business Media.
Kirton, J. J. and Trebilcock, M. J., 2017. Hard choices, soft law: Voluntary standards in global
trade, environment and social governance. Routledge.
Ferraro, G. P. and Briody, E. K., 2013. The cultural dimension of global business. Upper Saddle
River: Pearson.
Crystal, D., 2013. A global language. In English in the World (pp. 163-208). Routledge.
Briscoe, D., Tarique, I. and Schuler, R., 2012. International human resource management:
Policies and practices for multinational enterprises. Routledge.
Black, J.S., Morrison, A. J. and Gregersen, H. B., 2013. Global explorers: The next generation of
leaders. Routledge.
Bansal, P. and Hoffman, A. J. eds., 2012. The Oxford handbook of business and the natural
environment. Oxford University Press.
Online
Porter's Five Forces. 2018. [Online] Available through:
<https://www.mindtools.com/pages/article/newTMC_08.htm>.
Worlds top largest economies, 2017. [online]. Available through: <https://www.focus-
economics.com/blog/the-largest-economies-in-the-world>.
Enrolment in pre-primary education is not universal, 2018. [Online] Available
through:<http://www.worldbank.org/>.
OECD household income up 0.7% in first quarter of 2018, outpacing GDP growth, 2018.
[Online] Available through:<http://www.oecd.org/newsroom/growth-and-economic-
well-being-first-quarter-2018-oecd.htm>.
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