Professional Documents
Culture Documents
FASHION BUSINESS
Research project
WS 2010
VERTICALIZATION OF FASHION
BUSINESS
Project Supervisor
Prof. Claus Bühs
Project Team
Arzu Uslu
Asif Mangat
Mehroon Gull
Sajid Mehmood
Sohail Raza
Umer Jabbar
Usman Ameer
VERTICALIZATION OF FASHION
BUSINESS
Table of Contents
Introduction
Definition, Structure and Types
Reasons for Verticalization
Major Trends
Verticalization of Fashion Business
Verticalization Trends in National and International
Business
SWOT Analysis for Vertical Integration
Best Practices for Verticalization
Conclusion
VERTICALIZATION OF FASHION
BUSINESS
Definition
Structure
Contractualvertical system
Corporate vertical system
Types
Backward vertical integration
Forward vertical integration
VERTICALIZATION OF FASHION
BUSINESS
Reasons for Verticalization
Lower transaction costs
Assure supply of outputs
Correct market failure
Increase monopoly profits
Eliminate market power
VERTICALIZATION OF FASHION
BUSINESS
Major Trends
Joint venture
Franchise
Concession business
Manufacturer‘s owns retail shops
Retailer‘s owns manufacturing
Traders with manufacturing & retailing
VERTICALIZATION OF FASHION
BUSINESS
Verticalization trends in National and
Internation Trade
Retail business to service provider
Business specification
Customer consistency multiple channels
Diverse marketing techniques
Brand strategy
VERTICALIZATION OF FASHION
BUSINESS
VERTICALIZATION OF FASHION
BUSINESS
Backward
Vertical
Integration
High Fashionable
Skirt
Forward
Vertical
Integration
VERTICALIZATION OF FASHION
BUSINESS
Different Types of Vertical Relationship
High
Long-term
contracts
Franchises
Joint
Formalization
ventures
Agency
agreement
Spot s
sales/
purchases
Informal Vertical
supplier/ Supplier/ integration
customer customer
relationships partnership
Low
Opportunities Threats
Economies of scale Production cost fluctuation
Managerial Rewards Vertically adjacent activities
Shareholder Value Monopolization of markets
Control of Markets Competition
Risk Bearing
VERTICALIZATION OF FASHION
BUSINESS
Backward Vertically Integrated Companies
ZARA
H&M
Esprit