The changing face of UK Fashion retailing market

The changing face of UK Fashion retail merchandiseThe robes retail industriousness has been and is undergoing signifi lavatoryt changes resulting from processes of globalization, changes in consumer demand as closely as changing corporate activities in bournes of strategic trade decisions. The UK clothe retail industry has experienced significant growth which has centre attention on studies in the field with this sphere being considered as the maven of the most matched markets in Europe. This is primarily as a result of the concentrated power of strikingr retailers much(prenominal) as attach Spencer. One prime issue as a result of globalisation is that in that respect are more and more retailers sourcing globally aiming to provide war-ridden expenses and tone of voice products in the market. mark Spencer as such thence is challenged by this wind curiously from rival displace and supermarket competitors.Research MethodThe priming coat of the primary research c onducted in this brief was delivering a questionnaire based aspect delivered at four retail outlets two of which were Asda and two of which were label and Spencer. opportunist sampling was used in that customers were approached in the store as they entered and left field the premises and asked would they participate. A target of 100 questionnaires to be completed at each store was decided on to achieve a levelheaded sample size yielding useful results for the analysis. The questionnaire had four sections. The first of these sought-after(a) general demographic athletic field such as age and sex, the indorse section sought information related to the frequency of shop at the stores as well as frequency of shopping elsewhere. The third section sought altitudinal information related to reasons for purchasing in the individual stores while the fourth section and the fourth section sought information on predilections in terms of shopping specifically related to the variables of qu ality, footing and the retail environs. Data was entered into SPSS and analysed according to the objectives of the study.Permission to conduct the questionnaires were sought be local managers in the first instance though for two of the stores tho permission had to be sought be regional managers. All respondents were sensible of the anonymity of participating in the research and the results of the research were also offered to the managers convoluted in target to emergence the chances of victorfully gaining permission to conduct the research. examine was conducted during a weekday and at a weekend time in order to enhance the representativeness of the sample in terms of people working and vary their shopping times.Comparison of marketing mix in George at Asda and Marks SpencerOverall 412 questionnaires were completed but 12 of these were discarded due to rudi manpowertary or incorrect completed parts. Of the 400 68% were female person and 32% male. The age break spilehe arted of the sample showed that some 38% of the total was in the midst of the ages of 26-32 or everyplace although in the pil crushedcase of Marks and Spencer shopper the proportion of shoppers in this age group was higher being 49%. Also Asda had a higher proportion of shoppers between the ages of 18-21 than Marks and Spencer the figures being 19% and 9% respectively. Over 90% of the total sample had shopped more than once in each of the stores inwardly the previous month with 45% shopping at least twice a week in either Asda or Marks and Spencer.Of interest was the result that 40% of Marks and Spencer customers indicated that they would shop on that point regularly (at least once a week) while the figure for Asda was 29%. This may be an index finger of stronger cross off loyalty for Marks and Spencer in some respects but given hike results examined below may be under threat given attitudinal results related to price and quality. crosswayThe UK vestments retail industry h as grown in recent geezerhood and reached a comfort of $38.7 billion in 2004 which represented an increase of 3.7% over the previous year. Womens travail was one of the fastest growing areas in the field (Datamonitor, 2005). as yet it is claimed that the growth in revenues inside this industrial vault of heaven forget slow down mainly due to the impact of rabbet and nurture adding retailers offering clothing goods at rase prices forcing prices down boilers suit within the industry. Clear indications of this trend can be seen in this case study in that George at Asda and its range achieved significant growth and success compared to overall declining profitability within Marks and Spencer. Since the introduction of clothing ranges by the supermarket in 1990 its product categories take away expanded to include womens wear, mens wear and infants-wear. Marks Spencer has operated in the marketplace for decades and offers similar product ranges.While 49% respondents indicated a preference for shopping in Asda for womens clothes 51.2% of customers chose Marks Spencers to purchase womens products. It is obvious that there is slight difference in the choice of product range in so far the results also suggest that there a significant percentage (60%) of customers chose George at Asda primarily to buy childrens clothes and in particular to buy items such as school uniforms. One of the main reasons for this arguably can be relieveed by the lower price yet honest quality blueprint of the Georges range. Especially for younger children where school uniforms would be discarded in a comparatively short time due to the children growing the price of products offered by Asda can be said to be a significant seductive featuring influencing purchasing decisions.It has been reported that the childrens wear sector in the UK grew by 3% and reached a treasure of $4.7 billion in 2004. This phenomenon is perhaps attributable to the success of discount stores and superma rket operators who are able to provide cheaper childrens wear at level-headed quality levels (Datamonitor, 2005). From a macro perspective however the evenfall of return rates in Britain has resulted in the expectation of a future decline in childrens wear sales. Hence arguably over the longer term it may be the case that with possible future declining sales that this sector exit become even more competitive and quite feasibly the total of operators will be muffled in sell childrens wear.Evidence from this case study suggested that childrens wear product ranges represented 27% of customers purchases in Asdas compared to 10% in MS. additionally supermarket as generally a daily shopping preference for food provided a relatively convenient shopping environment for women and in particular working women to purchase childrens clothes.This was indicated by some 59% of respondents at the Asda stores stating they had or were intending to purchase items early(a) than clothes as well . It is reasonable to say that as a result of changing roles for women in two social and economic contexts there is increasing pressure such as reduced times available for shopping for women as discussed in books brushup. These newfound consumer behavioural characteristics commence resulted in changing retailing forms in the clothing industry to which new entrants such as supermarkets like Asda fork out capitalised on and responded to quickly as they emerge.In addition more men tolerate become involved in clothing buying behaviour illustrated by the mens wear sector growing 5% in 2004 (Datamonitor, 2005). It was evoke to examine the results of this case study in the comparison of consumer preferences towards mens wear at Asda and MS. In this research 46% chose MS when purchasing mens wear as opposed to 33% in Asda. It is useful to look at this trend in understanding the changing features of the UK clothing retail market posture in mind major impacts on consumer behaviour w ithin the sector. firstly Mark Spencer have exploited a stigmatisation schema which found a news report for high quality goods for a considerable issue of time.As a result of price wars between supermarkets and value adding discount stores MS has aimed to focus on quality in order to oppose it from rivals and perspective the store further in terms of exclusive designs as well as quality products. However its advertising campaign with the tagline entirely for everyone which was launched five years ago has been demonstrated to have mostly failed with customers turn away from the retailer because of its high prices to lower cost offerings in other retailers (Gardner, 2004). The high figure though mentioned above for MS respondents relating to whether they would shop in the future in the stores perhaps indicates that MS fluid retains a hefty customer base from which it could build on. However the validity of this assumption can be challenged given the size of the sample of t his research and would need further investigation on a larger sample to confirm or deny.As such while MS seems to have failed in maintaining competitive advantage through emphasising quality its supermarket rival Asda has also introduced designer ranges and lineed itself in terms of good design as well as lower price offerings. It is fair to argue then perhaps that MS will not improve its proceeding by challenging its supermarket rival on pricing and volume. Hence one response has seen MS switching to a defecting strategy. Secondly as outlined in the literature re shot purchasing clothing products should not be seen as indicative of familiar commodity buying behaviour because it is to a large extent it is link up with extrinsic factors such as culture and social status which in turn makes the value of stag names an essential element of clothing goods (Entwistle, 2000).Davies (1998) claims that the marketing of own grunges is a feature of modern multiple retailing which can al so be seen in this case study. Retailers such as Marks Spencer have created brand builds by advertising their own products and in the meantime transferred this brand equity into the physical products in their stores. The costs of branding to the retailer are lower than that of marketing other manufacturers brands. This contributes to an understanding and commentary of attitudes towards mens wear purchasing behaviour which in this case saw the brand name of Marks Spencer as a quality clothing manufacturer helping the retailer maintain a critical market conduct in the mens wear sector. It perhaps also demonstrates that men are little sensitive about price in purchasing clothing goods than female consumers in that brand name and perceptions of quality influence their decision make processes.Jobber (2001) argues that price is often used as an important indicator by customers during the decision making process hence it is useful for panache retailers who exploit pricing tools to create impacts on customers at the perception and valuation stages of the purchasing process. As Britains biggest clothing retailer Marks Spencer has established its brand image traditionally on the basis of providing quality clothing goods reflected in higher pricing justified as being good value for money given the quality of the product. In contrast rivalry at the discount and value adding clothing segment of the market has generated significant threats to MS not only from discount retailers such as Primark but more importantly from new supermarket operators. In this case study George at Asda was elect in order to provide a useful point of view in understanding the changing environmental contexts of clothing retailing.With a disturbance of 8301.5 Marks Spencers is one of the major clothing retailers occupying a commanding position in the halfway market level (FAME, 2005). It is reported though that Marks Spencer has continuously woolly-headed market office due to intens e competition in the UK clothing retail industry as well as from threats posed by new entrants such as George at Asda which has turn up to be a highly successful entrant with the company inform revenues of $26 billion by the end of January 2005 a significant increase of 19.8% compared to 2004 (Datamonitor, 2005). In contrast to George at Asda, Marks Spencer saw a fall of 2.6% in revenues with operating profits falling to $1.3 billion in 2005 (Datamonitor, 2005). check to this research customers switched from Marks Spencer to cheaper retailers where quality levels were perceived as being relatively high with George at Asda being for 61% their first choice. The extremely low price of designer products helped Asda penetrate the clothing retail sector successfully and stiffly. It is fair to say that international sourcing and effective lend ambit heed contributed to a significant degree to the competitive prices in its clothing sector in the same manner as its grocery section. It is also arouse to note that although more than 40% of customers believed that Marks Spencer maintained a fail quality level for clothing product ranges based on its reputation and effective quality control programs only 31% respondents considered clothing products at MS as good value for money. As such then the price war between supermarkets and discount stores have driven down the market price for clothing products while improvement of quality in some(prenominal) retailing sectors has become essential in the overall value adding process. As a result as one of the main middle market players Marks Spencer has been threatened both at price and quality levels. A strong financial background enabled Asda to achieve economies of scale and benefits from its combine supply set up. The power of Asda as a retailing giant helped it treat with global suppliers for lower costs which as a result let down final prices for consumers.Particularly in recent strategies by employing designe rs the creation of brand name and image of George at Asda contributed to its competitive capabilities. This point of view corresponded to sooner research discussed on consumer behaviour towards clothing buying which suggested that customers are particularly sensitive to price regardless of brand names yet in considering any extra value perceived in a brand name with the purchase customers became less sensitive to this element. This is able to help explain the strategic decision for Asda in building the brand name George at the initial stages of entering this very competitive market. Reflecting this it has been reported that MS had lost its place as the UKs biggest clothes retailer to its supermarket rival Asda. with MSs volume mete out of the clothing and footwear market stay static at 9.1% while Asdas George label increased its share from 7.3% to 9.4% in 2004 (Barnes, 2004).As a result the supermarket has grown to be Britains biggest clothing retailer after figures produced by Ta ylor Nelson Sofres which pointed to the volume of the George range at Asda rising to 9.4% compared with MSs share which was static at 9.1%. However in terms of sales by value MS is still the market leader beating the Wal Mart-owned supermarket by 3 billion jampack (Gardner, 2004). It is thus expect this represents a significant change in the retailing market particularly in consideration of the middle to value adding discount clothing market. This corresponds closely to arguments reviewed in the literature section which suggests that further casualties in the Mid-market and Value Clothing sector are expected driven by increasing competitive levels (Collins, 2005).Supply Chain Management franchising, merchandising and disseminationSince the mid 1990s there has been an evolution in the UK clothing retail industry which has seen increases in both offshore sourcing and international expansion (Jones, 2002). In terms of local apparel manufacturers sales are focused on a few large buyer s and Lustgarten (1975) has found that concentration ratios of major buyers have a significant impact on profit margins in the industry. In the case of Marks Spencer its strong position in the supply chain gave them strong negotiation abilities in the sourcing process but the trends of offshore work and overseas sourcing by other retailers has created crucial threats and challenges. The fast fashion strategy introduced by George at Asda in 1990 depends on effective supply chain management especially in the management of sourcing abroad to reduce labor costs. Additionally the Wal-Mart owned supermarket enjoys economies of scale from its large number of suppliers globally and as a result good design and fast fashion goods could be transported to supermarkets rapidly as with its grocery products. However for Marks Spencer as one of the UKs leading retailers the franchising group acts in a revolutionary substance in seeking to respond to these trends effectively (Whitehead, 1991).M arks Spencer has attempted to reduce have a bun in the oven hold by improving the efficiency of its logistics management in terms of lead times through promotional sales for stock goods (Benady, 2005). However the results here were disappointing particularly in relation to womens wear. grocery share feral by 5% and UK retail sales fell by 1.7% (Benady, 2005). The problematic aspect of this can be found in the supply chain where too complex a design in the production process and inefficient management strategies resulted in the decrease. Results in this research shows that respondents believed merchandise in the basic sales floor in MS was characterised by a lack of a clear marketing image and that the product ranges were too complex. The retailer has sought to cut down on its sub-brands and volume of stock held in order to introduce fashionable products at competitive prices in a shorter time. However it has been a point of meet that the management of its supply chain relied on management consultants rather than sales figures and marketing research on customer preferences. Consequently while UK womens wear sales grew by 4.9% Marks Spencer suffered decreases in terms of market share and operating revenues leading to reduced profitability.Due to the changing nature of the UK clothing retail industry there are revolutionary changes occurring in the supply chain sector. The most important element here can be seen as the increasing amount of sourcing activities from cheaper overseas suppliers such as easterly European countries as well as far Eastern regions. Additionally bearing in mind the key features of clothing products the principle of trimmed response is an integral element of the sector. This is to say lead times in terms of design, production, transportation as well as merchandising have become shorter. In turn benefiting from significant declines in stock prop numbers as well as risks linked with mark down sales clothing retailers are able to prov ide new ranges products within several weeks with maintained profit margins. As Porter (1980) suggests industrial performance is largely influenced by levels of competition and this is the case for the UK clothing retail sector. The position of Marks Spencer is not only challenged by competitors within the same market level such as Next but also from rivals in the value adding discount marketplace including Primark, New Look. Entrants such as Asda into this industry have likewise created evolutionary changes in terms of marketing strategies as well as revolutionary supply chain management changes.The lively retail environment in which 72.5% clothiong sales went through larger retailers since 1998 is expected to continue however the battle for market share and sales among large retailers has become more intensive (Retail Intelligence, 1999). The tables below suggest that while the price of clothing is approximately the same in considering inflation prices of clothing have decreased . The speed element linked with purchasing has also decreased dramatically. This reflects both the new characteristics of modern consumers who have less time for shopping but who are also more demanding in terms of price, quality and manner and the strategic choice by retailers in introducing fast fashion and effective supply chain management in order to meet this new demand.