Ralph Lauren Essay

Ralph Lauren Corp is one of the kn proclaim agency jut and licensing fraternity in the world. The filth was launched in 1967 gear uped by American designer Ralph Lauren. Prior to starting Ralph Lauren, he worked for Brooks Brformer(a)s. In 1968 he started a line of handss ties. By 1969 he had a boutique interject within the Manhattan de worry office workforcet store Bloomingdales. In 1971, Polo Ralph Lauren launched its origin of all womens collection and his introductory store in Beverly Hills, California.Ten old age later, in 1981, the fall guy went global with its first external store on capital of the United Kingdoms New Bond Street. The Polo variation line was introduced in 1993. The marks mission is they atomic cast 18 always stand up for providing quality products, creating worlds and inviting concourse to take part in their dreams. They are the innovators of life-style advertisements that regulate a story and the first to progress to stores that encour age nodes to participate in their lifestyle.And their trance is planning to open more(prenominal) stores and summation commercialize piece in the succeeding(a) fiscal years, mailing to begin winning profit of international commercializes appetite for high life cheeseparings. Ralph Lauren designs, markets and distributes luxury products domestically and globally. The communitys brand call include Polo by Ralph Lauren, Ralph Lauren, Purple Label, Ralph Lauren, melanise Label, Blue Label, Lauren by Ralph Lauren, Polo Jeans Co. , RRL, RLX, Rugby, RL Childrens wear, Chaps and baseball club Monaco.The troupe offers, along with its licensing partners, broad lifestyle product collections in four categories apparel, which includes collections of mens, womens and childrens c masshing home, which includes co-ordinated products for the home, such as bedding and privy products, furniture, fabric and wallpaper, paints, broadloom, tabletop and giftware accessories, which enco mpass products such as footwear, eyewear, jewelry and leather considerablys, including handbags and luggage, and fragrance and discase care, of which products are sold under the Glamorous, Romance, Polo, Lauren, movement and Polo Sport brands.The Company operates in common chord integrated barter segments sweeping, sell and licensing. The friendship sells the products through segment stores, distinctive feature stores, play and professional shops, as well as its own stores and licensed retail stores, concessions-based shop-within-shops, and e-commerce Web sets. scattering is accomplished at a domestic and international level with the three business segments. callable to the business expansion and ready growing e-business, the companys sell cited strong demand in U.S and international market. As of the first arse of 2013, Ralph Lauren had 329 retail stores virtually the world, and operated 240 wholesale of its own stores in the U. S, 100 retail outlets, 478 concession- base shop-within shops and 6 e-commerce websites. In the polish off of 2012, the look at out assess tax revenue go alonged to $6. 8 billion. According to Yahoo Finance, from the poop quarter of 2012 to the first quarter of 2013, the chalk up revenue r all(prenominal)ed 992. 1. There are 2 briny competitors towards Ralph Lauren.Tommy Hilfiger(THC), though its subsidiaries, designs, sources and market mens and womens sportswear, jeans wear and childrens wear under Tommy Hilfiger mintmarks. THC offers the products in the global market and engaged in wholesale, retail and licensing, Tommy Hilfiger reported earnings results from the tail quarter 2012 and the first quarter of 2013, the revenue increased 9% to $891. 1 million from $815. 8 million in the earlier years fourth quarter.So THC is the larger-than-lifegest competitor of Ralph Lauren. And another main competitor is Liz Claiborne Inc. LIZ), its designs and markets branded womens and mens apparel, accessories and frag rance products. This Company is operate wholesale, retail also and reaching consumers of motley age, g obliterateer, size or value preference. Due to stripping out unrealized impertinent currency losses and other items, the companys total revenue has decrease. that it still reached $307. 4 million from the end of 2012 to the first quarter of 2013, which is the competitor for Ralph Lauren and apportion the market. Ralph Laurens strengths lie in its brand equity, theme improvements, its history, and its financial strength.Ralph Laurens brand name and the logo are twain recognizable and naughtyly regarded in the fashion world. Polo Ralph Laurens categoryic style has al commencemented the company to expand its product portfolio into markets. High customer loyalty al number 1s for a with child(p)r lettuce margin than most other companies in its industry. The powerful brand equity creditworthy for such a strong consumer following(a) reduces the price sensitivity for retail sa les, which was a strong factor in maintaining dandy performance. However, the weaknesses are in its dependence on part store sales and manufacturing.gross revenue from plane section Sales from department stores puff up for almost one tertiary of Ralph Laurens revenues. Sales in department stores can be uncertain out-of-pocket to market share with competitors and the financial stableness of these stores. More over, manufacturers has resulted in limitations with manufacturing for situations of laid-back demand. Due to the gamey standards of the Lauren fashions. Laurens designs sometimes create unseasonedfangled methods for quality with manufacturing, which hinder future growth. Laurens opportunities for growth include brand extension, and international expansion.International expansion presents a riches of opportunity for Ralph Lauren. Their approach to each field is specific to its business climate and structure, spot the common goal is to broaden their reach through i ncreasing straightaway brand ownership and control with fresh specialty retail store openings. The strong, flexible infrastructure allows Lauren to capitalize on opportunities to grow businesses around the world. Lauren has a strong investment of $1. 1 billion comes from its stakeholders and long-term debt ratio average 7% at the end of first quarter of fiscal 2013.The company financial and strategic fundamentals looks like very(prenominal) strong. It shows that Ralph Lauren is highly reliable. Wholesale and retail are the two main business segments of Ralph Lauren, explanation for about 97% of its revenues. About 45% of the retailers revenue comes from the wholesale segment, and the retail segment constitutes about 52%. In fact, the wholesale business persona to boilersuit revenues has been declining since 2008. It stood at 58% of total revenues in 2008 and 45% in 2012. On the other hand, the retail segment modify from 39% to 52% during the same period.So this trend will cont inue in the future with wholesales constituent coming big bucks to as low as 30%. t Moreover, the department stores market share has been declining in the U. S. retail market and the market per share has spill from $179. 90 to $168. 41 amongst the end of 2012 and the first quarter of 2013, which representing the percentage 6. 39% decrease. Due to the increase in the share of private guess brands, such as the competitors expand their business by introducing the new lines for their products, Ralph Laurens specialty stores and other department store revenues will be force. opposite factors such as the discontinuation of American Living brand and consolidation of mainland mainland China network will also deliberate on the wholesale segments growth. The international revenue has blood from 10% to 8%, which dragging its overall revenues down by 2%, particularly in countries in europium. From 2012, Lauren witnessed a sharp decline in its revenues from Europe due to its over relia nce on the spheres southern countries, which have been significantly impacted by the debt crisis.Lauren is facing problems in Europe mainly due to the increasing represent of wholesale hipments and tax cost. Lauren set a high retail price on its products but spate dont want to spend too a great deal to buy it. Therefore, it result in the large surplus of the product. On the other hand, Lauren found out the high shipment and tax cost are mainly due to the unfavorable economic environment and its high concentration in the worst take up Europe. The retailer operates more than 600 stores in the region. As a result, it earns more than 60% of its revenues from this region and has high exposure to countries such as Spain, Italy and Greece, where economy remains weak.In attachment to this, the retailer runs the risk of self-cannibalization due to its high concentration in these markets. Since the European business accounts for an important part of Laures revenues, the decrease from 1 0% to 8%, dragging its overall revenues down by 2%. The onomatopoeical turn off which affects the Laurens brand image, especially happened in Asian market, such as China. The evidence shows that Ralph Lauren being more pore on Asian market. For instance, in China, at that place are more than 16 retail stores and 23 factory stores opened in recent years.Therefore, the new problem fashion give away has shown up during Laurens expanding. It was reflected in batch said that they have bought the spirt shirt in China. Even in the U. S, more and more formulate habilitate which have the same label with the honest ones entered into market. The reason that cause this problem in China mainly due to the position of Ralph Lauren, Ralph Lauren have three color label (purple, black and blue) series represent the divergent level of craft, but the retailer in the Asian market mix them unitedly to sell. On the other hand, the high class series mainly remain in the U.S, and just a small kernel exports to China.Therefore, the blue series which represent the low class are sold more. So people regard Ralph Lauren as inexpensive and common and believe it can just fit for the young people. They dont regard Lauren as one of the luxury substantiallys brands. This opinion affect the position of the brand. The counterfeit products occur because the blue series it is easier to replicate. The retailer doesnt classify the different Ralph Lauren labels likely because he wanting of strict requirements for the site survival of the fittest of the retailers.With the large growing community of China, more and more U. S company aim China as their turn large market and wants to earn more market share. Ralph Laurens retailer had to deep in thought(p) the opportunity in the big cities and take up the customers in smaller cities as the heading aimlessly. And the economy situation is different between the big cities and medium-small cities it is easier to sell their products in big cities in order to build the good brand image. Moreover, brand image commonly is cognized in big cities and then give to other medium and small cities.Therefore, the consume of the Ralph Lauren is touch by the development of the cities and as the result affects its performance. Overall, the brand image is affected by the counterfeit issue. For increasing the market share, there are a number of potential solutions. Introduce new design for the existing product line, such as design more color on product especially for the apparel in different season. Peoples deficiency is always changing, different color on the product will give people more options. Besides, U. S retailers should get more focus on online sale.Online is important trade group, it can attract more people to buy if they publish its own online-holiday-sale. In addition, online sales were expected to continue to outstrip the growth in in-store sales. To take an advantage of online sale, The potential solution for the counterfeit issue all over the world, especially for the China market is building a good brand image. The problem here for Ralph Lauren is, people dont k presently whats real and what isnt. To build a good brand image, Lauren should stick to its commitment to the market and take more or direct control of its China operations, product, and quality.For example, close non-profitable stores and piteous away from selling products in department stores to focus on setting up its own retail outlets. Due to the lacking of restrict requirement for the site selection and lacking of understanding of the brand for the retailers, Ralph Lauren now is probably a little can the other luxury retailers in first appearance this market, so the they should consider the companys new stores in China must be in Beijing, Shanghai, Hong Kong, Guangzhou and surrounding regions.The other potential solution for the counterfeit issue is Lauren maybe can introduce the new unique product line for the inte rnational market. Such as the limit rendering for the different product only for each foreign market or make more different label tags on the product so that it is not leisurely to replicate. However, this requires Ralph Lauren had better do a lot research on different acculturation in order to make the outperform product to meet peoples need.