Corporate Strategy Report: Starting a New Textile Business Venture

This report presents a strategic analysis for a new textile business venture, focusing on the introduction of formal business suits. It begins with an introduction to the textile industry's growth potential and the creation of employment opportunities. The report outlines the company's mission to generate profits and establish brand value, emphasizing the importance of market analysis, including PEST and SWOT analyses, to identify internal and external factors influencing the business. It details product offerings, target markets, and various strategies, including generic and grand strategies, along with short-term and long-term objectives. The report also covers financial planning, functional tactics, and strategic control measures. The analysis includes a focus on market development, competitor analysis, and the identification of opportunities and threats within the textile industry, providing a comprehensive overview of the business's strategic approach.

Corporate Strategy
[DATE]
[Company name]
[Company address]

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Contents
Introduction.................................................................................................................................................2
Company Mission........................................................................................................................................3
Product Offering......................................................................................................................................3
Market analysis...........................................................................................................................................4
External Environment -PEST Analysis....................................................................................................5
Internal Environment- SWOT analysis....................................................................................................7
Long term objectives...................................................................................................................................9
Target Market- Tactics................................................................................................................................9
Generic and Grand strategies.....................................................................................................................10
Short term Objectives................................................................................................................................13
Functional Tactics.....................................................................................................................................14
Financial Plan............................................................................................................................................17
Policies that empower action.....................................................................................................................19
Strategic Control and Continuous Improvement........................................................................................20
Conclusion.................................................................................................................................................21
References.................................................................................................................................................23
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Introduction
This report outlines the strategic analysis of the business for starting a new venture and the
industry chosen for the new venture is the textile industry. The textile market is mainly focused
in this report with an aim to introduce the new product like formal business suits in the market.
This report covers the strategic plan, analysis and the financial plan. The reason of the entry into
the textile industry is its largest growth in the world. As we know that the business of the textile
or apparel market is always growing and it is playing a very important role in the revenue
generation. The start up business of the textiles helps in creating the employment opportunities in
the textile industry because of its wide scope.
This report also focuses on the various types of the strategies that can be adopted by the
company to promote their products as well as for the growth of the company. Being an
entrepreneur, one person should have the idea of starting a new venture with the hope of profits
and taking the risks. All these risks are taken by an entrepreneur to achieve the objectives.
To start a new venture, it is very important to analyze the internal as well as external analysis and
the different strategies and cost associated with this. The idea of starting a textile business,
involves a lot of expenditure and need to take the financial decisions in order to earn the profits.
Moving further, the new businss always has the great opportunity to build its image. After the set
of the business, the people do not need to do the 9 to 5 jobs in their life and this is much
beneficial for the future generation too. The Business establishment is the great option from the
career point of view. The person starts with an aim to change the world and it will have the
positive impact towards the social change and the welfare of the society(Colovic, 2014).
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Company Mission
The mission of the new venture or the textile company is to earn the profits and bring a change in
the society. The main mission of the company will be to make the profits as well as create the
brand value among the people. Being an entrepreneur, the creativity, self confidence and the
leadership is must before entering into the new market.
Moreover, the textile company has the mission to become the most preferred choice of all the
customers and provide the people a professional and business look in an economical way. With
the business suits, we are going to contribute in the apparel industry and giving people an
alternative with latest fashion and trends(Jeyaraj, et al., 2012).
Product Offering
It is very important to analyze the needs and demands of the people before starting any new
business. Here, the product chosen to start the new business is the formal business suits. Taking
into consideration the needs of the people, the product chosen for the new venture is the
business suits. To provide the best quality services is the main focus of the company so that
people visit and shop on a regular basis. The target people for the chosen product is the
businessman and offer them the quality services at the reasonable prices and meet the demands
of the people and deliver them the product what they actually want(Hamre, et al., 2010).
Moreover, except the full fledged business suits, the company also offers the various other
products individually:
1. Formal shirts
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2. Formal trousers
3. Formal blazers
4. Accessories like:
 Ties,
 Belts,
 Watches,
 Cufflinks,
 Handkerchiefs.
Market analysis
The market analysis is the most important aspect for the starting up of the new venture. The
internal and external environment that has the greatest impact on the business must be analyzed
in order to earn profits from this new venture. The new business development in the market is a
very expensive process and it needs a lot of regulatory compliances. The market analysis
involves various factors such as research, claims, and the pricing strategies. Talking about the
market development, then it is the strategy that the business used to determine the different
groups as the potential customers of the existing products and services. Talking in simple words,
the goal of the market development is the expansion of the business in the markets which are still
untapped. These customers that the company looking for are, either served by the competitors, or
still not targeted by anyone for the formal suits(Kim, 2013). So it is suggested that the amount
needs to be invested in such a way that all the positioning of the products and services should be
in the financial budget. With the invention of a new development strategy related to place, the
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main focus is given to the maximum profits and the less losses. As we know that by doing this,
the time, money and other business resources can be utilized. A new business development
strategy is always helpful in doing the proper research and planning, customer retention, helps in
fulfilling the demands and expectations of the customers. It is analyzed that risk factors are
always there while establishing the new business and the these risks may have the negative
impact on the business growth. The risks that can be faced by the textile industries are the over
or underestimation of the target market, product quality, customer satisfaction as well as the high
competition in the apparel industry (Sánchez, 2015).
External Environment -PEST Analysis
The market and fashion industry can be analyzed properly with the help of the PEST and SWOT
analysis that includes all the important factors of internal as well as an external environment.
These factors are political, economical, social and the technological factors that may affect the
business.
Political Factor: Political changes in the country affect the business operations directly. The
industry is focusing on the UK country faces less changes as compared to the other
countries.Employee rights in the country have a substantial effect on a business. This industry is
a labor intensive industry so, the rules play a significant role.Employees rules like the minimum
wage law, overtime and safety regulations are affecting the business of any sector. In addition to
payment act, the country is having standards for the health and safety regulations also.
Administration requires annual safety training programs for the employees.Trade regulations are
mainly the single most factor influencing this industry. Since this fashion industry is a labor
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intensive industry, so the company faces the competition for other different countries where the
wages are more(Kala, 2015).
Economic factors: These are the factors that are related to the economic conditions of the
country as well as the prices of the products. It has been analyzed that the prices of the cotton or
jute increased in the year of 2011. This rise in the price obviously affected the textile businesses.
Similarly, the company needs to prepare initially for the future economic changes.
Social Factor: The Textile industry is merchandise of every age, sex and season. The main
motive of designing cloth is to satisfy the needs of the customer. Customer can find clothes as
per his need of climate, Fashion or other activity. For example, business suits are generally
preferred by the customers to attend the wedding functions, professional meetings, on job dress
codes, and parties. Talking about the apparel industry, the taste and preferences of the customers
are not the same always as they are changing with time and new trends. The customer analysis is
very important for the launch of the products in the textile industries. Some of the issues that can
be faced by the company are Socio-cultural related to cultural trends, customer analysis and
demographics.
Technology factor:Due to the availability of high tech technology the innovative part is quite
high in the country as compared to other one. Due to availability of high tech and automated
machinery the productivity is high. This industry is basically the labor intensive, but because of
automated machines the production can be automated now.
Internal Environment- SWOT analysis
SWOT analysis is a tool to identify the internal and external factors of the company. Internal
factors like strength and weakness of the company and external factors are opportunity and
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threats of the company. SWOT is helpful is very helpful for the business because with the help of
this company is able to form the business strategies to deal with the industry.
Strengths:
 The quality of the product in the current market section is considered high because of the
reputation as a country.
 They follow all the rules and regulation related to labor and working condition.The product
price is also considered as a strength of this industry.
 They focus more on new designs. The quality of the fabric is very high
 The delivery time is also quite good because of available resources and high technology.
 The Strong economy of the company also plays a very important role here. A Country is
already having an established commercial standards and law which help them to run the
business easily.
 As per, economy the profit margins are quite high in designer items and clothing business.
 Availability of skilled workers is also helping to create a competitive edge. Apart from those
the geographical size of the country facilitates easy movement within the country serves a
further advantage(Shahmaghsoud, 2013).
 The strong and organized industry sector is a boon for the country
 Lowering costs by achieving economics of scale is also the strength of the company.
 Advance technology and high-tech infrastructure
 Availability of capital investment
 Better marketing and research and development.
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Weaknesses:
The Limited amount of money for the investment purposes and limited production of clothing in
the starting up of the new venture is the weak point. The company may have to face many
problems because of the low budget (GBP 1,50,000).
Opportunities
The business of the formal suits has a great market opportunity, as there is a great demand of the
business suits from the Asian fashion markets. Moreover the company will have the option to
outsource the business to save money cutting down of the losses(Durei, 2017).
Threats:
For start up businesses, the competitors are always a threat for the companies.There are top 6
brands that deals with the Menswear formal suits in competition and these brands are shown
below: –
 Richard James
 Blackberry
 Gieves and Hawkes
 Marvood
 Hardy Amies
In the industries of the textiles, the competition and the rivalry among these competitors is
high and it is a threat to the company. It will be difficult to compete with the above
competitors as they already have a great brand value. The cost of the formal business suits
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also high of all the above competitors , that is why we are going to set the affordable prices to
compete with them.
Long term objectives
The long term objective of the new venture will be to attain the competitive position and earn
maximum amount of profitability by attracting the maximum number of people with the trendy
and quality products.
Target Market- Tactics
After the analysis of the needs of the customers as well as the markets, the next step is to
evaluate the target market where the product is to be launched. It is very essential to analyze the
areas and place for the new product launch. A small portion of the overall market is the segment.
There are different ways of segmenting the markets on the basis of geographic, demographic and
other psychographic product lines. Once the market is decided then the next step is building the
strategies in order to gain the maximum profits(Ganga, 2011). The different factors that need to
be analyzed and evaluate are:
Criteria Size: The size of the target market must be large so that the segmentation of the market
will be easy.
Difference: The difference between the two markets or segments should be measurable.
Accessible:The target market or area that is going to be chosen for the new venture must be
accessible and approachable by the team.
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Generic and Grand strategies
Product- We plan to launch our product (business suits) with following value propositions that
can help us to tackle our competitors well and also, will enable us to get a hold on the market.
 Stylish & Trendy: We will design our suits based on the current style and trend which
will grab customer’s attention. For this, we plan to hire young designers who will design
our suits based on the latest styles.
 Comfort &Quality: Our Company will focus on providing good quality products with
better stitch quality, smoothness and comfort(Parves, 2014).
Pricing- We will use the penetration pricing, which is setting the price of the business suits a bit
less than that of your competitors. This strategy will work really well in the price-sensitive
markets. On top of that, with our unique and value propositions, we will be providing a better
quality product to the customer, at a lesser price. It will help to provide our product an upper
hand in the market and ultimately a considerable level of increase in the amount of our sales and
thus, Brand recognition. With the growth in sales, we ultimately plan to achieve the economies
of scale, which will lower our operating costs to a minimum, and will increase our net profits.
Adding to this, once a brand achieves a considerable level of recognition and acceptability in the
market, we may be able to increase the level of prices of our products, due to brand
loyalty(Esguerra & Karlsson, 2013).
Distribution- The next part of the plan is to make our product available to each and every one.
Thus, for the distribution of our suits, we plan to adopt the market penetration through strong and
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robust marketing campaigns. We will have meetings with major shopping malls, so that we can
get in contract with them to sell our product, We will make sure to keep the supply in abundance.
We also plan to launch our products with a larger variety of designs, thus, providing a customer
with a lot of options to choose from. Another thing we plan to focus upon is the availability of
different sizes. Generally, in the clothing sector, the demand of brand remains low, due to non-
availability of sizes. When customers like the product but do not see their size for that, it’s often
heartbreaking for them and due to this, they generally make the perception regarding a brand;
that this brand doesn’t have the clothes of my size, and they never return. So, to avoid this, we
plan to keep a keen eye on our supplies, ensuring we have enough variety in the market, with all
the available sizes.
Apart from the offline stores, we also plan to sell our brand online by getting it listed on
websites, such as Amazon and EBay. Once our brand gets a hold in the market and if we feel that
things are going good on online medium, we will ultimately launch our own website to offer our
products at attractive discounts, which will help us avoid the amount of cost that we will have
incurred by paying a certain percentage of the sale amount to Amazon and EBay as commission.
And to do attract customers to our home website, we will launch some Exclusive designs, which
will be available on our website only(Kumar, 2011).
To expand the reach of our product and to get a hold on the retailers far away, we will also get
our brand listed on Alibaba. This will help us to tap into a larger distribution network. We will be
able to get in touch big distributors who hold a major portion of the distribution chain in the
market and thus, will ultimately help us reach a larger amount of customers, increasing our net
sales(Pandit & Upadhyay, 2014).
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Promotion-The saying that “A good product sells on its own” no longer stays true in today’s
world. In today’s market condition, where there are multiple players who provide almost similar
products with the exact same quality, a brand needs more than the product itself to stand out. A
brand needs to be in the spotlight, grabbing it’s customer’s attention, if the brand wants to
survive and thrive in today’s market conditions. To be in the spotlight, a brand needs to take the
help of a mix of various Promotional Techniques. But, using a set mix of techniques each time is
not an end of all problems, a company must be able to keep changing the strategies. Because, the
competitor will not stay silent. They will answer back, and therefore, the company must be ready
with another strategy to answer back the competitor’s answer. Therefore, there is a dire need of
effective Promotional Management within a company. Managing the promotional techniques is
not a child’s play. There are different factors which add to the effective management of
promotional techniques, and these factors are:
 The structure of the markets in which the company plans to position itself as a “brand”.
 The Ability of the firm to how adapt to market changes and requirements
 The Ability of the firm to adjusting its product and marketing mix based upon the
competitor’s strategies; and
 The Ability of the firm to grasp the psychology of its end consumer and to make such
strategies which immediately attract the attention of their
As entrepreneurs, we plan to launch our product in the market with aggressive ad campaigns
using both traditional and non-traditional means of promotion. Our ad will feature on TVs and
Radios. Since almost everybody is active on social media these days, we also plan to adopt the
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social media marketing. This will help us to reach the masses and can be possible through the
market penetration strategies as well as the product saturation in the target market. Apart from
that we plan to use introductory discounts, where we will offer a Buy 1 Get 1 discount on our
products available in both Shopping Malls and Online stores. We will also be contacting each of
the major shopping malls to get our products displayed in the front line of clothes, so that they
capture the attention of the customers. We also plan to launch a 5-day product return facility as a
promotional feature of our Brand on all our offline and online products(Svab, 2011).
Short term Objectives
The short term objective of the new venture is to launch the products in the market and to give
the strongest competition to the other competitors. These short term objectives are consistent
with the above mentioned grand strategies as the overall aim of building those strategies is the
increase in the sales of the company.
Functional Tactics
After building the generic and grand strategies, the important part is to implement these grand
strategies. While implementing these strategies it involves the various activities to be performed.
The management or the employees are playing the key role in the implementation of the
strategies as they are the one who are accountable for the implementation of the plan. There are
various functional tactics that can be adopted by the company’s employees in order to achieve
the short term objectives and these are as follows:
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1. First and most important task is the delegation of the work according to the abilities and
capabilities of the employees
2. As we are planning to launch our business formal suits in the market, so the aggressive
campaigning is very important.
3. Clarifying to the top management of the company about the how the functional managers
are going to implement the business strategies in order to gain the confidence of the
seniors.
4. It is very important to facilitate the coordination among the employees an different
departments within the company by letting them know about the areas of the potential
conflict and interdependence(Morozova, 2014).
5. Training and development of the employees on the daily basis is must in order to have the
perfect implementation of the strategies in the textile industry.
6. We need to run the ad on the TV and radios as well as on the social media because people
are very much active on social media these days.
7. Offering discounts to the customers and buy 1 and get 1 options on the online stores and
at the retail stores.
8. The marketing managers of the companies need to contact each of the major shopping
malls to get our products displayed in the front line of clothes, so that they capture the
attention of the customers.
9. The design of the advertisement mock up is essential to attract the customers and one ad
campaign mock up is given as below.
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Financial Plan
Every new entrepreneur estimates the requirement of the cash that covers all the expenses. In the
beginning of the business, it is an obvious thing that the company won’t be able to earn the
profits. There are still many people who are struggling in order to arrange the money for the
investments in new ventures. We have the budget of £1,50,000, before starting the new venture
of textiles. Talking about the resources of the financing, one of the most important sources of
the capital is its own savings in the bank account. The other source of financing is to borrow
some of the amount from family and friends. The other sources of the capital and the funds are
bank loans and securities and the credit cards. There are many other businesses who may show
the interest in order to raise the funds by investing in the newly established countries. The
government plans can be helpful in order to start own business of the formal menswear business
suits in the textile industry(Tourism, 2012).
Budget - £ 1,50,000
As we have£ 1,50,000 of the budget, it is very important to make a financial plan of the one year
in the form of profit and loss account and the cash flow statement. In simple words, there are
many steps involved in the financial plan:
 Begin with the forecasting of sales and need to prepare the 3 year estimation of the sales
forecast.
 Start building expense budget
 Cash-flow statement development
 Income estimation
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 Assets and Liabilities record- balance sheet(Consulting, 2009).
In the below pro-form of the profit and loss account, only the expenses related to the
advertisement and the research and production are estimated and put all the profits and expenses
in the below financial account for the 1st year of business.
Pro forma profit and loss for the 1st year of business
Sales
Direct Cost of Sales
Other
TOTAL COST OF SALES
Gross Margin
Gross Margin
Expenses
Payroll
Sales and Marketing and Other Expenses
Depreciation
Research & Development
Payroll Taxes
Other
Total Operating Expenses
Profit Before Interest and Taxes
£ 0
£ 0
£ 0
£ 0
£ 0
£ 0
£ 0
£ 1,50,000
£ 2,20,000
£ 69,000
£ 150,000
£ 30,000
£ 0
£ 2,19,000
(£ 2,19,000)
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EBITDA
Interest Expense
Taxes Incurred
Net Profit
Net Profit/Sales
(£ 2,10,000)
£ 0
£ 0
(£ 2,19,000)
Policies that empower action
There are many policies need to establish or followed in order to take the wise decisions and for
the enhancement of the speed and responsiveness of the business operations. The textile business
also needs to follow some of the policies in order take the best decisions. The different type of
policies are government policies, management in equity policies, human resources policies,
which are helpful in taking the best decisions in the organization. At the time of the delegation of
the work and the training of the employees, the HR policies are useful in order to explain the role
of the employee in the strategic implementation. The government policies are useful while
starting the new business(Valkjärvi, 2012). The government policies reflect the licensing and
trading laws that are important to consider while implementing the different strategies. The
government policies also helpful in taking the financial decisions for the new established
business of the formal business suits.
However, the top management of our new business also needs to build some of the company
policies in which the terms and conditions should be mentioned with regard to the functional
tactics. The organizational policies are the best part as it involves all the guidelines and
instructions for the employees to perform better in the organization. Therefore, the marketing
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and launching of the Menswear formal suits in the target market needs the full support of the
organizational policies to empower their action plans(Fiolic, 2015).
Strategic Control and Continuous Improvement
The sale of the new venture needs the strategic control to identify the critical risks involved in
the company strategies. Moreover, we need to find out what actions can be taken for the
continuous improvement and for the purpose of achieving the long term objectives. This is
analyzed that the sale will be affected positively if the demands and the customer’s expectations
will be fulfilled. Following are some of the points that represent the risks involved in the new
venture of formal Menswear Suits.
To meet the customer’s expectations is the very important aspect of the improvement in
the sales. This factor is also risky as the customer’s demands and expectations are
uncertain in nature and if the customers are not satisfied, then the sales of the company
will be affected adversely.
Moving further, it is also observed that the building the brand value in the case of start up
businesses is not an easy task. The reason behind this is that, it is hard to shift the interest
of the clients towards the new brands.
The huge amount of expenditure required for the promotion and advertisement of the new
business venture of the formal Menswear business suits(eStrategyPartners Team, 2011).
Another risk is the target people and time as we are focusing only on the business class
people more and the sale of the business suits is seasonal. The other non business class
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people buy these suits only for the purpose of the weddings, parties and festivals, but
again this will have the seasonal sale.
In the new venture of the formal suits, the feedback system should be strong as it will
helpful to control the business as well as useful in the continuous improvement of the
business.
If the queries and the doubts of the customers persists, then the lack of the policies may
affect the business. The seriousness of the personnel should be there to maintain the
control of the organization as well as to solve the queries of the customers.
After the analysis of all these risks, it is very important to understand the need of the customers
through the proper feedback systems. However, the collection of the data is very important and
then acting upon the same is become the business strategy of the company. The data related to
the customer’s choices can be obtained through the email, phones, face to face feedback,
questionnaire and the comment cards. The marketing process of the formal Menswear suits will
need a lot of improvement in the future to increase the sales of the company.
Conclusion
However, this report focuses on the various types of the strategies that can be adopted by the
company to promote their products as well as for the growth of the company. Being an
entrepreneur, one person should have the idea of starting a new venture with the hope of profits
and taking the risks. In this report, all these risks are taken by an entrepreneur to achieve the
objectives. This report also includes the market analysis before starting a new business as the
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market analysis is the most important aspect for the starting up of the new venture. The internal
and external environment that has the greatest impact on the business must be analyzed in order
to earn profits from this new venture. The new business development in the market is a very
expensive process and it needs a lot of regulatory compliances. The market analysis involves
various factors such as research, claims, and the pricing strategies. Talking about the market
development, then it is the strategy that the business used to determine the different groups as the
potential customers of the existing products and services. Talking in simple words, the goal of
the market development is the expansion of the business in the markets which are still untapped.
These customers that the company looking for are, either served by the competitors, or still not
targeted by anyone for the formal suits. So it is suggested that the amount needs to be invested in
such a way that all the positioning of the products and services should be in the financial budget.
The financial budget for the business of the Menswear formal suits is around GBP 1,50,000,
which is very small amount of the investments. The report concluded that the strategies and their
management are significant to the establishment of the new business of the formal suits.
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