PESTLE Analysis Of The Fashion Industry

MRP is exposed to many external challenges that shall be discussed in terms of the PESTLE analysis. The PESTLE analysis is split up into the following categories.

Environments Challenge Solution

Physical Image: Uniformity of interior and exterior shop design, especially after an upgrade or an image change.

Location: To have outlets accessible to all of their customers.

Local climate and weather: to have the correct apparel every seasons/ weather conditions in the shops.

Logistics: Stocking up all 1200 stores with the same ranges of clothing. For correct branding every shop should look the same. Changes should be done at all the outlets simultaneously.

Do market research on purchasing power in regions, cities and suburbs and act accordingly.

Mobile apps: Keep up with latest trends and technology. Good for advertising and brand building.

Online shopping: Becomes increasingly important but SA has poor delivery structures.

Product innovation: Introduce new technologies to improve customer experience and satisfaction such as self-check out systems and electronic tags for self-scanning. Continuously upgrade point of sales systems.

Have dedicated staff to keep MRP at the forefront of technological advances.

MRP should make deals with courier services such as DHL to improve deliveries of online shopping.

Requires lots of capital but good for future growth rate.

Legal BEE: Government legislation in terms of BEE may force MRP to review its management and employee structure.

Labour Acts: Compliance with most important labour acts such as Basic Conditions of Employment Act, Employment Equity Act, Skills Development Act and Labour Relations Act. In house training of staff. Extra effort to retain good staff.

Dedicated HR department to oversee that everyone sticks to the rules.

Environmental Green issues: Recyclable carry bags.

Water issues: To produce clothing uses lots of

MRP has the size and resources to buy, join or cooperate with existing online platforms. Successful start-ups such as zalando.com demonstrate the potential for online sales. It also corresponds with MPG’s omni-channel strategy.

The two retail stores in Australia are showing promising results. They are a cautious approach to expanding the business model overseas but a helpful tool to minimize an expensive learning curve. MRP should apply much more resources to establish the brand and focus on expanding its footprint in Australia.

Operations:

As important as it is to grow the business, MRP also has to keep abreast of optimizing its internal structures and logistics. An important step will be to establish a brand new distribution center with a size of 57000 square meters. MRP will have to make full use of this facility in order to reduce cost and thereby increasing its profit margin.

New IT as part of the IP and ERP systems will also help process efficiency and support the growth strategy.