Mainland China and Esprit Swot Esprit

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Esprit SWOT

Esprit was able to achieve their seventh consecutive year of growth in turnover and operating profit despite facing hostile economic environment in some of its geographical selling areas such as Japan,Korea and Malaysia. ...

Esprit has been adopting a globalization and diversification strategy; built strong brand recognition in its key market including Germany and Hong Kong, which has strengthened its sales performance.... Diversification in Esprit's operating markets could help reduce its dependence on a single currency, that is not putting all eggs inone basket; thus lower its foreign exchange rate risk.

Given its dominant position in Hong Kong's apparel market with a 44% increase in sales growth in Hong Kong last year, Esprit has also become a major player in the European markets. ...

Although it experienced significant growth in Europe especially with its key market in Germany where the brand is well recognized and ranks in the top five, Esprit has only 1. ... Britain remains to be weak for Esprit given UK's crowded and over-saturated retail environment in the apparel industry. ...

In addition, the high tax system in Europe would be a main burden on Esprit's profit despite its strong growth as compared with lower tax rates in Asian regions like Hong Kong and Singapore.

Opportunities

China's prospective accession to the WTO will benefit Esprit in terms of market access to mainland's garment and retailing industry.... Esprit would expect to tap the growing opportunities in domestic sales on the mainland resulting from enhance market access. ... This dual specialization between the two places will help Esprit enhance their competitiveness against suppliers of other low-cost region in Asia. Further, Esprit will derive additional cost savings from importing fabrics and clothing accessories for their garments manufacturer in the mainland, in the event of China lowering tariffs on these manufacturing inputs from the current average...
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