Table of Contents
1. Introduction
2. Background of Giordano
3. The product it sells and the market for its products
4. Analysis of the retailer
In terms of product/service quality
In terms of service levels
In terms of target markets
In terms of Major competitors
In terms of store lay out
In terms of promotion strategy
In terms of branding reputation
In terms of location strategy
In terms of technology used
5. Recommendations for improvement
6. References
1. Introduction
Being such an important part of the retail business, considerable attention must be paid to the organization of the sections of the retailer that carry out the functions which are included within product management. A buying organization could be defined as the entity within a retail organization that carries out the essential task of bringing goods into the retail business from the supply base to be sold on to retail customers. Although it is the most directly concerned with the product offer, the buying organization is not the only department or section within a retail business that is involved in product management ( & 2001). Logistics and visual merchandising, for example, have a deep involvement with products, but their role is one of support rather than control. The people who essentially ‘control’ the product offer are referred to, either in title or as a collective team, as retail buyers. Retail buying personnel operate on behalf of the commercial organization which employs them. Decisions are made for the benefit of the organization rather than the individual, therefore the ability to divorce personal taste or preference from the business role is an essential qualification ( & 2001).
Although most of the buying decisions are centered on the ability of a product to satisfy a customer need at a price the customer is willing to pay, a retailer has to ensure that it meets its legal obligations with regard to the products it sells. It also has to consider its long term image in the eyes of the public. It is therefore necessary to ensure that a product conforms to legal standards and provides value for money. A buyer is usually a marketing orientated person, who may need some advice when it comes to assessing certain product features and criteria. This is where a technologist can be a useful member of the buying team. Technologists will be up to date on product standards, manufacturing process innovations, raw material properties and so on ( & 2001). They are not primarily concerned with sales and profitability of individual items but, by ensuring that product standards are met and maintained, they play a key role in the long term success of retail product management. The quality of products such as Heinz baked beans or Phillips light-bulbs is assured by the brand, and in such cases the manufacturer takes the responsibility for maintaining the trust in product quality of the customer. However, from the retailer’s point of view, it is especially important that their own-labeled products do not violate any product law or tarnish the retailer’s reputable name ( & 2001).
If a retailer is own-label active, then establishing a department to manage the corporate brand is essential. This is particularly important in packaged goods retailing, where the graphical representation on the outside of the product is what sells the item. The use of logos, corporate style and colors are all of concern, and a retailer may issue a corporate design manual to ensure that all own-label suppliers conform to the same graphical standard. ( & 2001). The retail business has many ups and downs depending on diverse environmental and cultural instances. The paper will discuss a background Giordano, the retailer business in Hong Kong. The paper will also evaluate its products.
2. Background of Giordano
Giordano is a retailer serving the upwardly mobile youth of Southeast Asia, expanded rapidly into the enormous Chinese market and soon found itself losing money. Company chairman Peter Lau felt that the company had no focus, and he decided that it should emulate the trendy U.S. retailer The Gap, but with even better service. Excessive inventories led to the discovery that Giordano’s buyers had been ordering clothing without careful thought that they seemed to have lost touch with what their Chinese customers wanted. Lau’s solution was to force those buyers into focusing on the company’s customers by closing all but the largest of Giordano’s warehouses ( & 1996). His staff had to squeeze all the stock into the one remaining building, and, as Lau had anticipated, the crowding forced buyers to order more carefully by focusing their buying on a profitable segment of young customers. The strategy turned million of inventory into cash that Lau then used to refurbish the stores in keeping with his Gap vision. Giordano’s laser-beam focus is on delivering what its customers want, and growth is extraordinary ( & 1996).
As one of the fastest growing retailers in the Asia/Pacific region, Giordano has seen its sales increase from .7 million in 1986 to over 0 million. But in 1993, revenue growth had translated into losses of over million in its China operation. , the new chairman, took a number of actions to improve profitability, aiming at becoming outstanding with customers and at becoming The Gap of China, having 1,000 stores in China by the end of the decade. Although the company already had a strong service reputation, the largest neon sign in China was erected on the Pearl River, saying Giordano means service, and and his team engaged in a number of activities that helped the firm turn out a profit two years after its crisis ( & 1996). One highly leveraged activity was Giordano’s commitment to not only listen to its customers but use the data to improve how the company worked. Giordano conducts customer surveys twice a year and has an innovative program in which staff members play mystery shopper to put themselves in the customer’s shoes. In Hong Kong, which represents 26 percent of the group’s total sales, Giordano made an even more visible attempt to get connected to customers. It ran newspaper advertisements in Hong Kong asking customers for complaints, and offered a free T-shirt for every one submitted. Over forty thousand customers responded. After synthesizing all of the data, Giordano took action. One of the most frequent complaints was related to size availability ( & 1996).
Customers were complaining that shirts were too large. Giordano responded by adding an extra-small size in the polo and crewneck T-shirt line. In the end, extra-small crewneck T-shirts constituted 12 percent of crewneck sales and Giordano believes that the majority of these buyers are new customers. The data also taught Giordano that its customers believed salespeople to be overly zealous. Digging deeper, Giordano found that many of its Chinese customers were more conservative and felt uncomfortable when sales associates were overly friendly. The company taught its sales associates how to deal with different types of customers, and the next year won Next magazine’s Best Service Award in the boutique category. And in 1995, it won the Hong Kong Retail Management Association’s Best Service Award in the specialty sales category ( & 1996). Giordano is one of the most popular clothing retail stores not only in Hong Kong but in most parts of the world. It caters to various clients and provides them with different clothing needs and accessories.
3. Product and market
The main product of the company is various clothing lines that suite the taste of its diverse clients. It sells affordable casual wear for the diverse taste of their clients. It specializes in creating and selling types of clothes that include t-shirts, long sleeve shirts and denim jeans. It caters to male and female markets but it has more products that cater exclusively to women clients.
4. Analysis of the retailer
In terms of product quality
The products of the company are durable and can last for a long time. The products are properly created and tested for durability and are of high standards. The products of the company are made under strict procedures that cater to durability and high standards of quality. The products are tested for defects and quality issues.
In terms of service quality
In various countries different culture affect the service quality of the company. In some countries they have different ways of treating customers that is why the company has a level of uncertainty on whether the service the employees give on one country is the same as the service given in another country.
In terms of target markets
The company’s targets markets are mostly women customers but they value the importance of male customers. This target market is more beneficial for the company since women tends to shop more for clothes. This target market is a larger source of income and can provide much bigger help in introducing the company to more people.
In terms of major competitors
The company’s competitors include Bossini International, Espirit Holdings and Fast Retailing. The company handles its competitors well. It makes sure that the company has enough strategies that it can use to counter the advancements of the competitors.
In terms of store layout
The store layout varies in every country the business operates in but each store layout is intended to give the clients effective service and satisfaction as they look for things they want to buy from the company’s store. The store layout provides a description of the culture of the country the company is operating in. It shows the difference of taste of employees in different locations.
In terms of promotion strategy
The company makes use of different advertising techniques so that they can promote their product to clients all over the world. The company uses media such as television, newspaper articles and internet postings for more people to be informed of the company and their services. The company hires different popular endorsers so that more people will be engaged to buy their product.
In terms of branding reputation
The company is known for its products and when Giordano is mentioned the first thing that will come into mind is shirts and other clothing related items. The company made sure that it makes use of proper branding strategy and the company intends that this strategy will give them benefits.
In terms of location strategy
The company makes sure that its stores and branches are located in the most profitable places where clients can easily see the store and they can be encouraged to visit the store and buy products. The company also makes sure that competition in the location they want to put up the branch will not be too heavy. Most of the branches belonging to the company can be located in malls.
In terms of technology used
The company makes sure that the technology they use in creating the products, selling it and computing purchases are the most advanced and reliable for a specific endeavor. The company updates its knowledge of technological advancements so that they are not easily left behind.
5. Recommendations
For the company to be more successful the company should have a standard store layout and specific service guidelines. The company should impart to the personnel that the store layout and service guidelines should come first before imposing their culture on these two aspects. The company can provide assistance to the employees so that company standards can be mixed with culture and traditions. By doing this the goals of the employees and the business can be both satisfied without the conflicts occurring. Another thing that the company can do is to widen its client reach is to engage with partnerships with non competitors. By doing this more people will get to know about the company and its products. Both companies can benefit from this relationship and together they can solve each other’s problems and they improve the performance of the other company. The partnership can be used for both companies to know more about the company, the other company’s strengths and how the companies can use the strengths for their own welfare. Moreover an improvement that the company should make is to find more ways for them to advertise their product without incurring much cost but still achieving their goal.
References
Credit:ivythesis.typepad.com
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