Research Question: How can Fakir Apparels LTD (fakirapparels.com) attain their lost market leadership?
This topic seems to be of great interest as FA. LTD has faced an intense competition in Bangladesh and therefore has decided to expand on the denim internal market. This project is expected to be successful and therefore provide the company with a greater market share in the apparel sector. Moreover, it would offer the Chief Committee of the company the possibility to find out whether this sort of internal expansion would improve the product range entailed to diversify with a denim division to sustain its competitive edge.
Theoretical Framework: FA LTD seems to exceed its normal expansion rate, as the number of apparel production units in Bangladesh are rapidly increasing, consequently leaving FA LTD with very little choice.
In order to diversify its activity and to activate on the internal market as well, the company has decided to act in the denim division sector. In this framework, this project aims to present through a strategic analysis and a general discussion about the products and markets associated, the stages the company has to fulfill to attain its purpose.
Summary: The research plan would be quite simple: at the beginning I would present a brief review of the framework the company finds itself in, the methodology used and the difficulties encountered; afterwards I would talk about the exact position of the company on the market, the method I used to gather the necessary data in order to develop this analysis and the results I have obtained, mainly Fa LTD’s defaults and qualities and its competitors’ market position.
The former result would be put into evidence with the help of the SWOT Analysis, of the Internal and External Evaluation Matrices and with the help of the Ansoff Matrix, through which help there would be presented the best strategies for product development, market penetration and market extension. The last part of the paper would contain some recommendations made on the basis of the analysis developed and the conclusion, which would summarize the general situation of Fa LTD company.
Methodology: The first step I would follow to complete my research would consist in visiting the Financial Advisor and the General Manager at F.A. LTD in order to obtain the appropriate information. This would be provided by the company’s past annual reports and afterwards I would asses the present situation of the company by looking at the market structure, product range, the competition that FA ltd faces and the market share.
The next stage I would perform would be a SWOT analysis which would focus on the opportunities that this would bring for FA LTD, which I would put into evidence in the end with the use of an Ansoff Matrix. This will point out the different marketing options when considering new opportunities for sales growth.
Difficulties Faced: The course of the analysis proved easy to be followed, with the exception of a slight problem I encountered in obtaining the market share that FA Ltd holds in Bangladesh.
Introduction FA Ltd has started its activity in the apparel sector in 1998. They entered the global market with extensive and tactical preparation with included a strong manufacturing base – modern machinery and appropriate equipment to meet high quality standards -, latest technology and proper discipline. They benefit of skillful workmanship, significant marketing methods and consistent compliance..
The company has also acquired an international status by producing clothes for a great number of buyers, most of them being located in the USA and in Europe. FA Ltd has achieved this success due to its ultimate technology and to its cooperation with foreign designers, having a tendency to expand in whatever ways possible while contributing to development in the apparel sector. This company has gained an exceptional reputation among its buyers for its correctness and excellent product quality which is maintained with ISO standards.
Situation FA was dominating the garment market by only producing T-shirts; gradually, over the years the company has lost its market leadership in the apparel segment as the competitors have expanded into a wider range of products such as producing jackets, trousers and denim products. In order to retain the market leadership FA Ltd has to expand by launching a new product range and, in order to fulfill their clients’ expectances, the company’s specialists have thought to come up with some original items in denim division, but there was already a pre-dominant competition in the market which had earned consumer loyalty.
The primary data needed for the study has been collected through a discussion with the company’s sub merchandiser of FA Ltd which presented the theoretical and the qualitative aspects of the issue. The information about the market behavior and the company’s position in the market had been collected from the commerce registers, and has also been inferred from the public declared purpose of the private organization. On the other hand, further data about future projects has been obtained through a direct discussion with the CEO of the company.
The secondary data was collected through the company’s past financial records. Strategic analysis has been used to help the company decide on strategies to become the market leader again. SWOT analysis has been used in order to offer the company the possibility to analyze its current position in the market place against its competitors. This identified the main internal and external factors that would influence the company’s decision. Ansoff matrix depicts the various options open to the company and the strategy they should use to become the market leader.
Results: FA Ltd was leading the market for t-shirt production until 2004. Their turnover would tip $ 40 million which is 9% in Bangladesh of the total market when the competitors Beximco and Knit Concern holding 7 and 5% respectively decided to launch a new product range which expanded their market size gradually taking over the market in Bangladesh. Therefore, FA Ltd is studying the market to analyze whether opening its own Denim division would help regain their market leadership.
FA Ltd product range
Beximco product range
Knit concern product range
Men’s wear (cotton and polyester) for brands HnM, Tom Tailor, Mustang
Men’s wear (cotton, polyester and denim)
Men’s wear (cotton, polyester and denim)