Ralph Lauren Essay

Ralph Lauren Corp is one of the best-kn give fashion externalise and licensing fraternity in the world. The inciter was launched in 1967 founded by Ameri fuck causation Ralph Lauren. Prior to starting Ralph Lauren, he worked for Brooks Brothers. In 1968 he started a line of mens ties. By 1969 he had a dress shop come in within the Manhattan section store Bloomingdales. In 1971, Polo Ralph Lauren launched its first womens collection and his first store in Beverly Hills, California.Ten course of studys later, in 1981, the fool went global with its first world(prenominal) store on capital of the United Kingdoms New Bond Street. The Polo Sport line was introduced in 1993. The brands mission is they argon always standing for providing quality harvest-times, creating worlds and inviting stack to take part in their dreams. They are the innovators of lifestyle advertisements that tell a story and the first to raise stores that encourage customers to participate in their lifestyle .And their raft is planning to open more(prenominal) than stores and increase trade contribution in the next fiscal years, military posting to begin taking return of international grocery stores appetite for luxury sounds. Ralph Lauren designs, commercializes and distributes luxury products house servantally and globally. The corporations brand names accommodate Polo by Ralph Lauren, Ralph Lauren, Purple Label, Ralph Lauren, fatal Label, Blue Label, Lauren by Ralph Lauren, Polo Jeans Co. , RRL, RLX, Rugby, RL Childrens wear, Chaps and Club Monaco.The beau monde offers, along with its licensing partners, extensive lifestyle product collections in four categories apparel, which includes collections of mens, womens and childrens c handlehing home, which includes coordinated products for the home, such(prenominal) as bedding and bath products, furniture, cloth and wallpaper, paints, broadloom, tabletop and giftware accessories, which encompass products such as footwear, eyewear, jewelry and leather goods, including handbags and luggage, and fragrance and genuflect care, of which products are sold under the Glamorous, Romance, Polo, Lauren, Safari and Polo Sport brands.The participation operates in three integrated avocation sections sweeping, sell and licensing. The troupe sells the products through department stores, forcefulness stores, golf and professional shops, as well as its own stores and licensed retail stores, concessions-based shop-within-shops, and e-commerce Websites. Distribution is accomplished at a domestic and international level with the three business segments.Due to the business refinement and fast growing e-business, the companys wholesale cited strong annoy in U. S and international market. As of the first quarter of 2013, Ralph Lauren had 329 retail stores around 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 website s. In the end of 2012, the total revenue reached to $6. 8 billion. According to hick Finance, from the fourth quarter of 2012 to the first quarter of 2013, the total revenue reached 992. 1. in that location are two main enemys 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 trademarks. THC offers the products in the global market and engaged in wholesale, retail and licensing, Tommy Hilfiger reported wage forces from the fourth quarter 2012 and the first quarter of 2013, the revenue increased 9% to $891. 1 million from $815. 8 million in the prior years fourth quarter.So THC is the king-sizedgest competitor of Ralph Lauren. And another main competitor is Liz Claiborne Inc. LIZ), its designs and markets branded womens and mens apparel, accessories and fragrance products. This Company is operating wholesale, retail also and reaching consumers of various a ge, gender, size or value preference. Due to stripping out un real(a)ized foreign notes losses and other items, the companys total revenue has decrease. but 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 share the market. Ralph Laurens strengths lie in its brand equity, infrastructure improvements, its history, and its fiscal strength.Ralph Laurens brand name and the logo are both perceptible and toweringly regarded in the fashion world. Polo Ralph Laurens homeic style has allowed the company to expand its product portfolio into markets. High customer loyalty allows for a larger profit margin than most other companies in its industry. The powerful brand equity responsible for such a strong consumer following reduces the charge sensitivity for retail gross revenue, which was a strong factor in maintaining good performance. However, the weaknesses are in its dependence on department store gross s ales and manufacturing.Sales from department Sales from department stores make up for near one third of Ralph Laurens revenues. Sales in department stores can be uncertain imputable to market share with competitors and the financial stability of these stores. More all over, manufacturers has resulted in markations with manufacturing for situations of richly demand. Due to the high standards of the Lauren fashions. Laurens designs sometimes create sunrise(prenominal) methods for quality with manufacturing, which hinder future growth. Laurens opportunities for growth include brand extension, and international expansion.International expansion presents a wealth of fortune for Ralph Lauren. Their approach to each region is specific to its business climate and structure, spot the general goal is to broaden their reach through increasing take aim brand ownership and control with novel specialty retail store openings. The strong, flexible infrastructure allows Lauren to capitaliz e 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 simply 7% at the end of first quarter of fiscal 2013.The company financial and strategic fundamentals looks like very strong. It shows that Ralph Lauren is highly reliable. in large quantities and retail are the two main business segments of Ralph Lauren, accounting for roughly 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 contribution to overall 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 improved from 39% to 52% during the same period.So this trend will continue in the future with wholesales contribution coming down to as low as 30%. t Moreover, the department stores market share has been declining in the U. S. r etail market and the market per share has decline from $179. 90 to $168. 41 between 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 label 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 impacted.Other factors such as the discontinuation of American Living brand and consolidation of mainland China network will also weigh on the wholesale segments growth. The international revenue has decline from 10% to 8%, which draw its overall revenues down by 2%, particularly in countries in Europe. From 2012, Lauren witnessed a sharp decline in its revenues from Europe ascribable to its over reliance on the regions southern countries, which have been importantly impacted by the debt crisis.Lauren is facing jobs in Europe mainly due to the increasing cost of wholesale hipm ents and tax cost. Lauren set a high retail price on its products but people dont want to spend too much 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 admonishing economic environment and its high tautness in the worst overhead Europe. The retailer operates more than 600 stores in the region. As a result, it profits more than 60% of its revenues from this region and has high exposure to countries such as Spain, Italy and Greece, where parsimoniousness mud weak.In addition 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 decreased from 10% to 8%, dragging its overall revenues down by 2%. The counterfeit issue which affects the Laurens brand visit, especially happened in Asiatic market, such as China. The evidence shows that R alph Lauren being more focus on Asian market. For instance, in China, there are more than 16 retail stores and 23 factory stores opened in recent years.Therefore, the new riddle counterfeit issue has shown up during Laurens expanding. It was reflected in people tell that they have bought the counterfeit shirt in China. Even in the U. S, more and more counterfeit clothes which have the same label with the reliable 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 diverse level of craft, but the retailer in the Asian market mix them to fastenher to sell. On the other hand, the high class series mainly remain in the U. S, and just a venial amount exports to China.Therefore, the blue series which represent the low class are sold more. So people regard Ralph Lauren as cheap and common and believe it can just fit for the young people. They dont regard Lauren as one of the luxury goods 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 crystallize the different Ralph Lauren labels probably because he lacking of strict requirements for the site plectron of the retailers.With the large growing population of China, more and more U. S company aim China as their second large market and wants to earn more market share. Ralph Laurens retailer had to missed the opportunity in the big cities and choose the customers in smaller cities as the object aimlessly. And the economy situation is different between the big cities and forte-small cities it is easier to sell their products in big cities in order to build the good brand image. Moreover, brand image usually is cognized in big cities and then spread to other medium and small cities.Therefore, the need of the Ralph Lauren is affected 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 potentiality solutions. Introduce new design for the existing product line, such as design more color on product especially for the apparel in different season. Peoples need 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 take in more people to buy if they publish its own online-holiday-sale. In addition, online sales were expected to continue to outpace 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 immediately whats real and what isnt. To build a good brand image, Lauren should stick t o its commitment to the market and take more or direct control of its China operations, product, and quality.For example, snug non-profitable stores and moving away from selling products in department stores to focus on setting up its own retail outlets. Due to the lacking of determine requirement for the site selection and lacking of understanding of the brand for the retailers, Ralph Lauren now is probably a little behind the other luxury retailers in entering 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 international market. Such as the limit edition for the different product only for each foreign market or make more different label tags on the product so that it is not easy to replicate. However, this requires Ralph Lauren had better do a lot research on d ifferent culture in order to make the best product to meet peoples need.