1. Brand YG taking over Z2 and the reasons for the takeover?
Company X produces luxury fashion brand – YG - The Y generation. The brand is hugely successful in the UAE and GCC market with a market share of 30% in the medium fashion brand market. The Brand is solely owned by a family business in Dubai. The brand was established in 1995 and was hugely successful during the financial crisis period, as customers preferred the ‘not so expensive brands’ during the crisis period. The brand’s market share ate in to the earlier undisputed market share of the global brand, which was termed as hugely expensive brands as customers shifted to controlled shopping behavior. This was a great opportunity of YG and it really cashed in on the fact that it could …show more content…
Even though this seems to an ambitious target the management has clear plans and strategies to achieve this target. The management knows that setting this target is not only a challenge to the sales force but also a challenge to the production team to cater to this massive sales target. So during the last management meeting a decision was made to take over a business, which has the capacity and drive to meet the production targets of brand YG. This will also help in easing out the pressures at the current facility. Various options were considered before this decision and the option of building another facility by the company was also considered, but this was dropped off because of the timelines of the target and the cost of setting up a new facility. So take-over was a unanimous …show more content…
Even though there we availability of big global brand there was a big niche opportunity which lied untapped. And the market vastness of this market along with the affinity of the population to fashion brands was a major advantageous position for this brand. Customers did not have many choices in brands as it were either highly expensive global brands or the look like local brands. There was a big segment in the middle, which was untapped till now which caters to the middle-income group of the market. This market has a good mix of rich African investors, plus a major chunk of middle-income groups and the low-income groups who always aspire to ape the segment above. So this was a perfect mix. Moreover the logistics to this country was also favorable as there were already export happening to this place from UAE and China. So this market was selected as the next expansion destination for brand
Company X produces luxury fashion brand – YG - The Y generation. The brand is hugely successful in the UAE and GCC market with a market share of 30% in the medium fashion brand market. The Brand is solely owned by a family business in Dubai. The brand was established in 1995 and was hugely successful during the financial crisis period, as customers preferred the ‘not so expensive brands’ during the crisis period. The brand’s market share ate in to the earlier undisputed market share of the global brand, which was termed as hugely expensive brands as customers shifted to controlled shopping behavior. This was a great opportunity of YG and it really cashed in on the fact that it could …show more content…
Even though this seems to an ambitious target the management has clear plans and strategies to achieve this target. The management knows that setting this target is not only a challenge to the sales force but also a challenge to the production team to cater to this massive sales target. So during the last management meeting a decision was made to take over a business, which has the capacity and drive to meet the production targets of brand YG. This will also help in easing out the pressures at the current facility. Various options were considered before this decision and the option of building another facility by the company was also considered, but this was dropped off because of the timelines of the target and the cost of setting up a new facility. So take-over was a unanimous …show more content…
Even though there we availability of big global brand there was a big niche opportunity which lied untapped. And the market vastness of this market along with the affinity of the population to fashion brands was a major advantageous position for this brand. Customers did not have many choices in brands as it were either highly expensive global brands or the look like local brands. There was a big segment in the middle, which was untapped till now which caters to the middle-income group of the market. This market has a good mix of rich African investors, plus a major chunk of middle-income groups and the low-income groups who always aspire to ape the segment above. So this was a perfect mix. Moreover the logistics to this country was also favorable as there were already export happening to this place from UAE and China. So this market was selected as the next expansion destination for brand