Strategic Management Report: G2000 in the Hong Kong Fashion Market

This management report provides a comprehensive strategic analysis of G2000's potential for expansion within the Hong Kong fashion market. The report begins with an introduction, followed by a company overview, and then delves into a PESTEL analysis to assess the political, economic, social, te...Read More

Management report : Can
G2000 well be strategically
planned in the Hong Kong
Fashion Market

Table of Contents
INTRODUCTION...........................................................................................................................1
COMPANY OVERVIEW...............................................................................................................1
PART A...........................................................................................................................................1
PESTEL analysis ........................................................................................................................1
SWOT analysis ...........................................................................................................................4
Porter's five forces analysis.........................................................................................................6
PART B............................................................................................................................................8
Ansoff's Matrix............................................................................................................................8
Bowman's Strategic Clock........................................................................................................10
Recommendation.......................................................................................................................13
STRATEGIC MANAGEMENT PLAN .......................................................................................14
Strategies...................................................................................................................................14
Objectives..................................................................................................................................14
Tactics.......................................................................................................................................14
Gantt Chart................................................................................................................................16
CONCLUSION..............................................................................................................................17
REFERENCES..............................................................................................................................19

INTRODUCTION
Business strategies are those guidelines which can be followed by a business to earn
maximum profits. Every business wants to earn maximum profit and every company want to
increase their market share . The business are expanding at a rapid speed and if the business does
not grow then it won't be able to sustain in the market. In the report there are various analysis
done like PESTLE, SWOT , Porter's Five Forces Analysis and more. The report also include
various strategies which can help G2000 to expand its business in new market like Ansoff's
matrix which divides the whole market in four segments and Bowman clock strategy. Different
business follows different strategies according to their needs and their future prospectus.
COMPANY OVERVIEW
G2000 stands for Generation 2000 is an international apparel brand founded by Michael
Tien in the year 1980. Headquartered in Hong Kong, the company has over 700 outlets in the
entire Asia and Middle East. G2000 has various branches and subsidiaries attached to it like
G2000 man, G2000 woman, G2000 black and At twenty. The company employees thousands of
employees throughout the world.
The company wishes to expand its operations as it would help them in increasing their
customer base effectively and efficiently. This will also lead to reduction in their overall cost and
would contributes towards their future growth. The organisation is aiming towards obtaining a
strategic management approach as it would help them in achieving competitive advantage.
PART A
PESTEL analysis
In this section, evaluate the PESTEL analysis of G2000 company which is specialist of
clothing chain distributing of fashionable in women's and men's career wear. The PESTEL
analysis is a basic strategic business tool. With the help of this company is able to evaluate,
organise, discover and track macro economic factors which may affect to business and strategy
in both negative and positive ways (Chang, 2016). Below is evaluated the all factors such as
political, economical, technological, environmental, legal and social factors are as follows:
Political factor:
Political factors play an important and significant role in determining those factors which
can impact to G2000 company to operate in Hong Kong fashion market. The political factors are

considers with government regulations which has to follow by any business at the time of
business as well as new start ups. Political stability of Hong Kong is stable which is help to
companies for operates business. It is also trades regulations free agreements which give permit
starting business in Hong Kong main market land (Espinoza and et.al., 2019). This is positive
aspects for G2000 company. But most of the time it gives negative impact by introducing new
trade regulation in market place.
Economic factor:
Inflation rate, saving rate, foreign exchange rate, economic cycle, economic growth,
interest rate are considered in economic factor. Economic factor is also impact to business and its
growth factors. This labour cost rises is also affected to business product costs and also to
customers of G2000 which is not good for growth at Hong Kong market. However, at Hong
Kong market have various benefits like strategic position is more than 90% of GDP (Economic
information of Hong Kong, 2019). Recently, retail sales is increases by 6.5% which is good for
G2000 to operates in Hong Kong fashion market industry. This will help to company to take
decision for start new business in market.
Illustration 1: PESTEL analysis of
G2000
(Source: PESTEL analysis. 2018)

Social factor:
Society culture, tradition, attitudes, eduction level, population growth and age distribution
are includes in social factor of PESTEL analysis. This may highly affect to business and its
growth factors. The social economy of Hong Kong market is rapidly growing with strong
government support as well as a well-established philanthropic culture increase corporate
sustainability efforts. Moreover, it is the freest economy in world with free trade and low
taxation and minimal government intervention which is highly helped to G2000 company
operates in Hong Kong fashion market with their own traditions. This may also determine by
target customers purchase rate which is depends on their earning (Gander, 2017). The population
of Hong Kong is earned effective wages against of their work which is potential in positive side.
Other had, peoples who are working class want to earn more and save their money for better.
However, it can be affect to company in the future.
Technological factor:
Technological factor is well know component which is affect to business. That is related
with research and development, change in technology. Present days advance technology is highly
impact to the business by increasing competition at marketplace. In order to analysis Hong Kong
market company uses advance technology and study on big data which is collect by research and
development department. With the help of this, G2000 company is able to analysis and also
reach towards target customer (Grünig and Kühn, 2015). Other than, company is not use big data
then manager is not understood the requirements of Hong Kong market. This can affect to sales
of fashion products in the future. Moreover, company should provide information to their
customer on online apps with more customer are attracted towards company.
Legal factor:
Different market and place have different norms and rules or regulations which has
followed by companies for better performance in market place. Those aspects may related with
customers, trade, vendors, competitors, discriminations and employment low. In context to
G2000 company to operate in Hong Kong market in this company have first understand the
import and export rules. For example: company purchases raw material form outside. In that
company requires legal and proper import and export license which is help to do their work
without any issues. Otherwise, it can give negative impact on company. Moreover, company

provide detailed information on online apps (Gürel and Tat, 2017). In that they have hide their
customer details by data and customer protection law.
Environmental factor:
All markets have their own environmental standard which is impact to the profitability of
an organisation in particular market. Before entering in new market and operates new layout in
new market the G2000 have to evaluate environmental standards which is highly required in
those market place. This includes weather, climate change, law regulating, recycling and current
trends of present market. Weather and climate changes can affect to the business. Like company
G2000 is want to operates in fashion market their company is required to include seasonal
products and items which is help to increase sales such as winter, summer and spring cloths
(Huang and et.al., 2015). The company has to target which is included production of sustainable
products with the best quality and organic material which is help to company for increase sales
as well as long term business.
SWOT analysis
SWOT analysis is a study which is used by company in order to identify its internal
strength and weakness as well as external opportunities and threats. This will help to company
understand those and build strategy for growth in market place. With the help of this, company
can overcomes their weakness by using strengths and opportunities. Evaluation of SWOT
analysis of G2000 company is as follows:
Strength:
 G2000 is well known brand which is sales apparel products to their customers.
 The company is use best and unique technology for manufacturing products and services.
Like Non iron fine cotton garments sipping technology.
 The company have ability to exploit online shopping has enabled it in order to reach
many customers in different countries and enhanced sales.
 Online shops are highly helped to business in order to reach target customers. Like
fashion market is highly attracted to women mostly (Jin and Cedrola, 2019).
 The company has give effective quality assurance in their products and items which is the
best strength of company.
 Most of the customers highly loyal for G2000 company because it is highly specialist in
men and women cloths industry sector.

Weakness:
 Company is use the best quality of products but have most offline pursuance in market
which is influence. This is the weakness because offline is attract customers but not more
than online detail.
 Low collection of market data which is issue for business because with the absence of
data analysis company is not able to understand needs and wants of customers (Madsen,
2016). In this company have to invest more on their research and development
department by using the best technology. In order to that, company have to use digital marketing for increase their sales which is
leading marketing strategy.
Opportunities:
Illustration 2: SWOT analysis of G2000
(Source: SWOT analysis, 2017)

 Company not use the digital marketing by this they can lose their customers base. In this
company have opportunity to use digital market platform for increase their sales.
 Company sales best and unique quality of cloths in men and women as well as
automobile products. G2000 have opportunity to operates in kids products which is lead
high products and services at market place (Strategy, 2017).
 G2000 have more competitors at market place, in that manager have to analysis strategy
of them ad made new strategy as per requirement. With the high unemployment rate, company can use cheap labour which may leads to
low production cost and low cost of final products which is helped to increase sales,
because customers are attracted to high quality products associated with low prices.
Threats:
 Apparel industry is changes with change in taste and preferences of customers which is
the main threat of company.
 The fashion industry in most of the country does not have a same right of copyright
protection as other innovative product like art and film. This is copied by different
fashion designers and sold their products at lower prices which is affects its sales
products and profit margin (Thompson, Strickland and Gamble, 2015).
 Other threat is economic stability which is different at every place and country. This may
affect to business and its growth factors. Like high inflation rate is increased prices of
products and decrease sales of products which is other threat that is faced by company.
Porter's five forces analysis
Porter's five force analysis is tool in order to analysing competition of a business. It is
build by the organisation in order to determine competitive intensity and attractiveness of an
industry in terms of its profitability. Porter's five forces analysis of G2000 is as follows:
Threat of new entrants (low)
Apparel fashion industry is highly affected by the new entrants in market because its facts
they are come up with new, unique and low price of product. Fashion industry is had the high
risk and high reward industry. There is huge lack of uniqueness in the industry. Therefore, less
likely company is entered into fashion market which is already exist in market (Phillips and
Moutinho, 2018Pr). In that company have to provide their products and services at low prices
with the best quality and unique design.

Threat of substitute products and services (low)
This force considers similar product's ad services that can be used in place of company
products and services pose a threat. Company produce goods and services for which there are no
ended substitutes will have more power in order to increase prices and look towards the
favourable terms. For example: tea and coffee both are similar products, in the absences of tea
people can be drink and use coffee (Vitasek, 2016). That is the threat of substitute products.
However, cloths have not any substitute product and item but it can be affected by brand and
quality of product and services. So threat of substitute products and services are not affect to
G2000 company.
Bargaining power of buyer (high)
The bargaining power of buyer in apparel fashion industry is so high which is affected
business and sales of G2000 company. In the market place have various design and style of
cloths which can affect to customers other sides because every company and store have different
design and style (Prasad and Warrier, 2016). The quality of product is highly important for
customers because they are purchase product as per quality and price. This simply means that the
Illustration 3: Porter five force of G2000
(Source: Porters five forces of G2000, 2018)

buyers in this industry is less price sensitive. This make bargaining power of buyers a weaker
forces in this industry.
Bargaining power of suppliers (low)
There are various numbers of suppliers in fashion industry which leads products and
services at various places. They are control it has over potential to rise its prices which is turn
into lower profitability. The number of suppliers in the industry in which G2000 operates is a lot
compared to buyers. This have mean that suppliers have less control over prices and its mistakes
bargaining power of suppliers a weak force. Suppliers provide fair standardised, less
differentiated and also they have low switching costs. This also make weak force of bargaining
power of suppliers on G2000 company.
Competitive rivalry (hight)
There various competitors of G2000 in Hong Kong and other place which can lead to
negative impact on business. Competitive rivalry is very high force which is affect to G2000
company at market place. Big brands like Zara, H&M and other fashion industry is had their
goodwill in market place with best and attractive quality of product and services. Competitive
rivalry is high because there is not opportunity of innovation in products (Scholes, 2015).
All about the internal and external analysis lead understanding in the external analysis
company have online space and opportunity to increase there sales as well as operates in Hong
Kong fashion market. Other hand, in internal analysis company required some improvement in
management skills and also study on big data which is collect by research and development
department of company.
PART B
Ansoff's Matrix
It is a type of planning tool which help managers, executives and marketers to make their
strategies for the growth of the future. This definition basically defines four types of growth
strategies which can help the business in growing in its existing or new market. Each alternative
poses different level of risk to the organisation (Asef, and et.al., 2017). This strategy is useful for
a company like G2000 which is thinking to expand into new product segment. Different
alternatives are:

1) Market Segmentation: In market segmentation strategy, the business tries to grow using the
existing products and services in its existing markets. Aim of this strategy is basically to increase
market share of a product in current market. This strategy can be achieved by a business by
selling more products to the existing customers or making new customers of product. The
demand of a product is created in the market so that company can incur more sales of it. The
company can achieve this objective through aggressive advertising and promotion or through
right distribution. This strategy can be attained by
 Reducing the price of product: if the company reduces the price of current product then
sale of the company will definitely increase and this will increase market share as people
will buy more of this company product (Bamford and et.al., 2015).
 Increase in promotion and distribution support: The company should do more advertising
of product so that people get to know about the product. It can also increase it sales by
providing efficient distribution support to the customers (Christopher, 2016).
 Acquisition of rival: The company which is producing and selling same product in the
market can be acquired so that competition reduces and this will indirectly increase the
sales and profits of the company (Zinovchuk, 2016).
 Market Development: According to this type of strategy the company tries to go or
expand into new market using its existing products. The company does very less
development in its products. There are various ways to achieve this like:
 Having different customers: Different customers means that the sale of company is high
and it has many people who are ready to buy the product. The demand is slightly less
than supply. It is very good for a company to have loyal customers because they are the
ones who increase the profits of the company (De Waal, 2016).
 Shifting from household buyer to industrial buyer: The company earns small profit when
it sells goods to household customers as they just take goods which are in need and in
small quantity and industrial buyers take goods in large quantity which increases the
profits of the company immediately. Every seller wants to sells its goods to industrial
buyer as they take goods in large quantity (Harris and Kamarthi, 2015).
 Foreign Market: The company can try to sell products in new countries by opening its
stores there. Foreign market is very good for a company because many people like to buy

products from new brand and if they like the product then they can also be converted into
loyal customers (Prasetyo and Rahman, 2018.).
 Product development: In this strategy the company tries to produce new product &
service and sell these products in the existing market. This strategy is used by many
companies and G2000 is also adapting this strategy. It is going into fashion clothing from
career clothing. Career clothing is a clothing segment which includes formal wears of
men and women. The company is trying to achieve this target by creating new product
and it is also trying to enter new market. The company needs to do various things like
investment in Research & Development so that the product created is good and
successful in the future (Kaar and Stary, 2019). New product should be made by the
company after thinking from various prospectus so that the new product made does not
have any deficiency. Company can also acquire the rights of producing someone else
product. There are many times when a company has good design but it does not know the
way to utilise them. These companies are mostly acquired by big companies and its styles
are taken and they are reproduced (Johansson and Svensson, 2017).
 Diversification: This strategy is acquired by those businesses who want to start a new
product line in a new market. This strategy is basically very risky for every company as
the firm does not know the response of new market and with bringing new product also in
new place it becomes more risky. There are two types of diversification i.e. Related and
Unrelated diversification. In related diversification there is some contact with the existing
businesses in new market so there is a chance of help. Unrelated diversification means a
diversification in which there is no relationship in businesses. G2000 is diversifying also
with its new product(Medarac, Vignali, and Vignali, 2016).
Bowman's Strategic Clock
It is a model that sees that where a product should be positioned so that it gives the
product most competitive position in the market (Berisha Qehaja, Kutllovci and Shiroka Pula,
2017). The purpose of this strategic clock is to illustrate that the business has a variety of options
based on the dimension of price and perceived value. There are different positions in which this
clock can be described as:
 Low price and Low Value Added: in this strategy the company reduces the price of the
product. The problem is that the price is so low that there is no competitive position for

business. The product does no differentiate and the value added by customer is also very
low or little despite of low price of product. It is a type of bargain strategy and the only
fear to company is that there should not be anyone who is there to undercut it (Bremser
and et.al., 2018).
 Low price: The strategy here is that the business should sell low price products to
customers. There are many business which are surviving today because of their low price
(Cummings and Angwin, 2015). Profit margins in this case is low but the total number of
goods sold is high and this create a huge profit for the company. Is some cases low price
products are very much demanded and the profit on them to company is also low so they
are easily able to sell these goods and this create a huge profit to company. The
competition which is prevailing in this market is generally very high and intense and they
often lead to trade wars between companies. G2000 can use this strategy if it wants to sell
more in the starting as there will be good market share of company. The sale of the
company will increase and there will be more customers of new product (Helmold and
Samara, 2019).
 Hybrid: hybrid means that there is a combination of two elements in the product. The
combination is low price with product differentiation. The aim of this strategy is to
influence customers and to create a combination of reasonable or correct price and
product differentiation. This strategy is said to be very effective if the value added by
customers is consistent every time. G2000 can use this strategy if it has good customers
so that there is good advertisement of the product (Jayakrishnan, Chang, and Kim, 2019).
 Differentiation: differentiation gives the highest level of satisfaction to the customers.
They are very happy with the product because of its quality and value. A company with
very good brand image and quality is required if it wants to sell high price goods and a
different product. All the big companies use this strategy as there product quality is very
good and they sell their products at high prices due to good brand image of company.
G2000 can sell products using this strategy because the brand image of the company is
very good and people will buy costly cloths (Helmold and Samara, 2019).
 Focused Differentiation: The aim of this strategy is to sell products at a very high price.
The reason for selling products at high price is the brand value of that company. The
quality of these products is very good and it is usually adopted by luxury brands who

invest huge funds in promotion and distribution. G2000 can adopt this strategy after some
times if it wants to come in luxury sector and if the quality of the products is good then.
This strategy is very beneficial as company can earn high profit margins but the problem
with this is that only few products are able to sustain in the long run (Köseoglu, and et.al.,
2019).
 Risky High Margins: this strategy is of high risk and it is made for failure. Following this
strategy, the business sets high prices of the products without giving anything extra in
terms of value. The customers will buy in starting and then they will find a better
alternative of this product which gives same value or is low priced. Risky high margins
are for short-term only and it is an uncompetitive strategy. Selling goods at high prices
without justification of price is tough or next to impossible in any normal competitive
market (Lapersonne, 2018).
 Monopoly Pricing: Monopoly is a situation in which there is only one supplier of a
product. The monopolist doesn't have to be concerned about the prices or the value which
the customer perceives because there is only one option in the hands of customer i.e. they
want to but or not. According to theory the monopolist can set any prices of product but
due to various government regulations in different countries, they are not allowed to set
high prices. If G2000 has any any monopoly product then it can charge high price for it
but with some limits on it (Rahimi, and et.al., 2015).
 Loss of market share: This is a type of a disaster to any company. According to this
strategy, company decides a middle or standard price for a product which is having very
less perceived value. This product will not be able to win because there are many
companies who are ready to sell products or have better options at this price but with very
high value offered to customers (Sternberger, and et.al., 2019).

Recommendation
By seeing all the above strategy, the best choice for the company will be Ansoff's matrix.
Ansoff's matrix is very good for company as there are different prospects by which a company
can be success. It includes various growth strategies in it and the best strategy in it is product
development. The company can use product development and it can introduce a new product in
the market. G2000 is introducing new clothing sector in market. It is bringing casual clothing by
its brand name. The company is currently only dealing in career clothing or formal clothing for
men and women. It can start dealing in new products so that the company grows in international
market and it can achieve success. It must make sure that the strategy which it chooses should be
taken after proper research on it so that the company does not have to change it afterwards.
Source:(Bowman's Strategic Clock, 2018)

STRATEGIC MANAGEMENT PLAN
In accordance with the recommendation it is outlined that for entering into fashion
market of Hongkong G2000 will focus on new product development with differentiation. The
process helps in firm in engaging with customer preferences which in turn aid in increasing
market share and customer base of organisation (Asef, P.and et.al., 2017). The firm offers
specific career clothing for men and women which has limited market of organization.
Therefore, product development is strategic dir4ection which support growth of firm in new
market.
Strategies
The strategy of G200 is to target new customers of fashion market of Hong Kong. As per
this focus of firm will be on offering trendy clothing range with respect to changing fashion
trends. The strategy will help the retail company in gaining competitive advantage against
rivalries like,
Objectives
To attain successful product development of entering into fashion market of Hongkong, it is
important for the management of company to plan objectives which are as follows:
 To recruit new staff for designing fashion clothing wear in time span of 6 months.
 To market and promote fashion clothing with the helps of digital marketing with 4
months
 To increase sales of clothing in market of HongKong by 5 %
 To increase customer base in market of HongKong by 6 %
Tactics
 Product development: The major strategy of Generation 2000 is to introduce new product
labels in the Hong Kong market. Therefore, the company is aiming towards developing a
proper strategy in order to increase their sales and growth. It is imperative for the
organisation to draft a concept, design the product and then develop it accordingly. Once

the product is developed G2000 company needs to ensure proper marketing of their
products. New products and services must be developed by proper market research
otherwise it can hamper organisation's productivity and they may fail to generate enough
profit in the long run.
 Staffing: It is imperative for the company to recruit and select right kind of people at right
job at right time at right place. Also, the Human resource department must give proper
training to their employees in order to sharpen their skills. The company needs to employ
adequate and talented fashion designers and sales people. Investment in training and
development would be beneficial for the company in the long run.
 Fashion store department: In order to expand its activities the G2000 company is also
aiming to open new stores in the new market. The company must introduce interactive
and unique display design that can help in attracting customers. This will not help in
retaining old but also attract new customers which will help in their growth and
development.
 Marketing and promotion: Marketing and promotion is the key aspect for the success of
any organisation. The G2000 store can use digital marketing to promote their brand
online. This is extremely beneficial for the company as they promote their product online
through you tube, Facebook and other social media tools. These tools are way cheaper
and can help in reaching out to a large number of audience.
Another benefit of digital marketing is that it will help G2000 in identifying their target
customers and then sell products to them accordingly. The organisation offers direct e-mail and
bulk messages to induce people to buy their products and services.

Gantt Chart
Task Name Duration Start Finish Predecessors
Manually
Scheduled
Product development
project 180 days Fri 8/30/19 Thu 5/7/20
Auto
Scheduled Initial meeting 30 days? Fri 8/30/19 Thu 10/10/19
Manually
Scheduled Staffing 10 days Thu 10/10/19 Wed
10/23/19
Auto
Scheduled Fashion designers 5 days Fri 10/11/19 Thu 10/17/19 2
Auto
Scheduled Fashion sales associate 5 days Thu 10/24/19 Wed
10/30/19 2,3

Manually
Scheduled
Fashion Store
Development 80 days Tue 10/22/19 Mon 2/10/20 4
Auto
Scheduled Store layout 40 days Thu 10/31/19 Wed
12/25/19 4,5
Auto
Scheduled Display designs 20 days Tue 2/11/20 Mon 3/9/20 5,6
Auto
Scheduled Store launch 20 days Tue 2/11/20 Mon 3/9/20 6,7
Manually
Scheduled
Marketing and
promotion 60 days Thu 2/6/20 Wed 4/29/20 8
Auto
Scheduled Digital marketing 60 days Tue 3/10/20 Mon 6/1/20 8
Manually
Scheduled
Project result
monitoring 5 days Tue 3/10/20 Mon 3/16/20 8,9
CONCLUSION
From the above report it can be concluded that G2000 is major player in the Asian
countries but the company wishes to expand its operations which can be done through strategic
planning. For this purpose, the organisation performed PESTLE analysis in order to scan the
environment and identify the external factors affecting them. The organisation also performed
SWOT analysis to identify the strength and weakness of the company and the opportunities and
future threats that can affect the company. It further helps them to grab the opportunities in order
to counter the threats. They also implemented Ansoff Matrix in order to identify the best strategy
that can be used by them for achieving growth and profitability. Moreover, Porter's five forces
were used to provide company with competitive advantage. The strategic management plan is an
effective plan in increasing the profitability of the company when they wish to introduce new
product into the market. At the end, it can be stated that effective use of these strategies can help
a company in achieving profitability as well as long term growth.

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