The Benetton group

Founded in 1965, the Benetton Group started with limited resources that necessitated the st come ingy that ultimately resulted in rapid international growth. Since the beginning, Benetton concentrated on devoting its skills to the design and dedicate off of quality clothing instead of providing direct consumer retailing. Benetton doed a competitive advantage by kick ining its brand as the known Italian app arel manufacturer, concentrating mainly on fashion-conscious young consumers from their middle(prenominal) teens through mid thirties. Since almost 85% of its mathematical product is subcontracted to most 500 contractors some(prenominal) in Italy and abroad, and most retail stores are independently owned, Benetton does not have direct managerial regard over production and sales operations. Additionally, Benettons in-house operations and manufacturing partners are for the most part centralize in Italy (as much as 82% of force manufacture products were produced in Italy) , making them susceptible to exchange rate fluctuations. On the retail side, Benetton utilizes contracted agents working on commission to establish and support retail outlets. The entrepreneurial agency ashes helped Benetton to quickly distend their retail network, and thus, push more Benetton products. However, the agency system does not provide the operational support to retail stores open in centrally controlled retail competitors, like The Gap, and cannot enforce either vulgarism in layout, stocking, or décor from store to store.

Additionally, the payment twist for agents only encourages sales. There is little direct inducing to divvy up best p! ractices with new(prenominal) agents in different territories, to share business give-and-take with Benetton, or to devote resources to helping cast the Benetton brands. In otherwise words, the agency system encourages the free-rider effect. It is recommended that Benetton alter its schema in four-spot steps to defend its core markets, and to organise itself for future world(a) expansion into new markets. In other words, Benetton needs to contact globalization for its long-term growth, and... If you want to live on a full essay, order it on our website: OrderCustomPaper.com

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