Assignment Sample on Managing Strategy, Operations and Partnerships
Introduction
The Thailand based company Atelier Chiang Mai is a clothing manufacturing company. This company is recognized for taking effective strategies in order to create a strong market for addressing the customers (Clothes Production Partner In Thailand Asia, 2021). With the introduction of technological advancement within the business operation, the company has been able to maintain a unique stand in the competitive market. During the developmental periods, the company has faced certain issues and developed strategies to mitigate them. The undertaken study aims to explore the competitive advantages of Atelier Chiang Mai stemming from their strategy. In addition, it will discuss the pricing strategy of the company.
The competitive advantage of Atelier Chiang Mai stemming from its strategy
Atelier Chiang Mai is associated with the production of superior quality garments for many worldwide fashion brands. The brand is responsible for providing superior quality clothing at a reasonable price to the customers and many clothing companies. The clothing manufacturing company ensures guarantee services to its clients. Atelier Chiang Mai is associated with providing professional services to its customers (Clothes Production Partner In Thailand Asia, 2021). However, Atelier Thailand happens to be managed by entrepreneurs of Europe and Thailand and faced various production-related issues for their brand. Learning from their experiences, Atelier now provides entirely integrated and professional clothing production services to its clients.
The term competitive advantages denote the qualities that enable a business company to surpass its competitors in the industry. This is beneficial for the companies in order to achieve the highest margin of profit when compared to its competitors and initiate company value and the shareholders of the company (Corporate Finance Institute, 2021). The prime advantage of competitive advantage is that it differentiates a company from its opponents. It is associated with contributing to increased prices, more clients, and customers. In addition, competitive advantages enhance brand loyalty (Shan et al. 2019). Therefore, it is very important for the company to establish a competitive advantage in order to ensure the success and sustainability of the business. By adopting competitive advantages Atelier Chiang Mai has become more efficient in producing garments. In order to attain competitive advantages, Atelier has ensured access to the natural resources for manufacturing clothes that are not available to its competitors. In addition, the company has made itself positioned in the industry by manufacturing handmade clothes that require highly skilled professionals (Gareche et al. 2019). The hard work of the highly skilled labourers and their superior quality creation has made it possible for the company to stand apart from its competitors. In terms of controlling the quality of the manufactured garments, the quality analyst checks the quality, goes through the fabrics, and searches for dirt in the fabric (Lin et al. 2020). However, if there is an issue with the fabric, the company lets the clients know and allows them to mitigate the problem. By doing this, the company builds trust among the clients and increases brand loyalty.
Atelier provides competitive prices due to the comprehensive capacity that they source from the manufacturers. This is the biggest competitive advantage of the company by lowering the manufacturing costs (Vovchenko et al. 2017). This allows the company to produce garments at a lower cost. This helps in selling the products at a low cost to its customers while keeping the quality intact. Again, this strategy of competitive prices has made it possible for the company to gain competitive advantages. The company has a unique geographic location, from there it is able to access and meet the requirements of the customers. In addition, the company has seen to be focused on developing sustainable products that have created a strong position for the company in the market (Sutapa et al. 2017). These strategies have been beneficial for the company in creating a strong brand value among the clients and the customers. In this study, the chosen company has gained competitive advantages by exhibiting its sustainable operations such as taking ecological responsibility and focusing on human rights. This has made the growth of the company much easier in the competitive market. Therefore, the identified advantages of the company in the market are the materials, skilled laborers, low-cost manufacturing price, location of the company, and the quality of the materials (Todeschini et al. 2017).
The theory of competitive advantage was propounded by Michael Porter in the year 1985 (Bashir and Verma, 2017). As per the theory of competitive business organization, companies are required to adopt policies that will ensure the creation of superior quality products to sell at increased prices in the contemporary market. Potter’s theory has emphasized the growth of production as the main focus of the organizational strategies. The theory suggests that cheap labour is pervasive and for a good economy, natural resources are not needful (Kharub and Sharma, 2017). In a company, competitive advantages generally occur when the company develops or combines certain qualities in order to outlast its competitors. In this respect, Atelier requires to focus on the adoption of new technologies such as AI and robotics as a part of the product production or include it in the manufacturing of the products.
Issues and develop corporate strategic options
The company Atelier Chiang Mai has faced certain issues regarding the price and quality of the products in the initial period of their business venture. The prime objective of the garment manufacturing brand Atelier Chiang Mai was to produce fashion clothes having superior quality for the French luxury brand known as Nathalie Fordeyn Paris. The company is recognized for manufacturing its clothing line in Chiang Mai for several years. The company faced issues regarding its business in Chiang Mai. Ever since it started producing clothes in this place the company started developing problems regarding the quality of the products produced. The quality of the garment was very poor. In addition, the prices of the garments were extremely high when compared to the quality of the products. For small quantity production of clothes, the quality was a disappointment. In Thailand, the clothing manufacturing team lacked professionalism, which is another significant issue, identified in this study. In addition, the company has been identified as having ethical issues that are related to the maintenance of a poor timeline (Corporate Finance Institute, 2021). The company was recognized to be unable to deliver its products on time to the clients which is another issue that was faced by Atelier Chiang Mai. Due to poor quality control and lack of professionalism and poor time management the company lost several important customers. Another issue that the company faced in the initial days was the lack of skilled professionals who are capable of producing quality work.
Atelier Chiang Mai is undoubtedly one of the largest garment production companies that create only quality products. Each product is created with extreme care and craftsmanship. However, the price of the products is a bit expensive. It is good to maintain quality products by keeping the price a little high in order to create a brand image and increase the brand value of the products. The coats manufactured by the company are excessively expensive for common people to purchase. Generally, fashion is for everyone. Therefore, keeping the price of the garments low will enable college students and normal people to enjoy buying fashionable clothes. Apart from the high price issue, the company has faced technological and machinery issues. The company previously used heavy machines in order to produce garments in huge quantities and in doing so the company failed to maintain superior product quality.
RACE framework
The RACE framework is a strategic model developed for helping companies to plan a system that will help the business, be it small or large in order to draw effective advantages from the opportunities that are available in the digital marketing areas. It helps in the management and improvement of the results gained from digital marketing.it aims to cover the life cycle of the customers for launching and promoting novel products. Four stages in the RACE framework have been identified by Atelier Chiang Mai. These four stages include Reach, Act, Convert, and Engage.
| Factors | Goals | Strategy across the goals |
| Reach (Effective strategies to address customers) | ● Creating awareness among the customers regarding the reduction of the price | ● By offering discounts
● Introducing lucrative offers |
| Act | ● Social media campaign
● Off-line campaign for attracting customers |
● Increase brand endorsement
● Approaching celebrities to promote offers as well as the brand. |
| Convert | ● Increasing the profit from 10 to 12% | ● Internal and external cost-cutting
● Enhancing the quality of the product. |
| Engage | ● Creating customer loyalty
● Increasing brand value ● Involvement of the customers with the brand |
● Gathering customer feedback
● Engaging customers through social media pages ● Google Adword |
Table 1: RACE framework
(Source: Created by author)
Resultant strategic direction of Atelier Chiang Mai
The applied strategies will be helpful in directing the creation of a strong customer base for the company Atelier Chiang Mai.In order to reach customers by making them aware of the reduced price, the company has created awareness among the customers about the reduced price by offering them discounts on the products. In addition, by making them introduce lucrative offers such as buy one; get one free, the company has become successful in managing the cost of the products. By doing this the company will be able to develop higher REACH among the customers. In addition, the company has invested in social media campaigns as well as offline campaigns in order to reach more customers.
For this, the company requires making a brand endorsement and includes celebrities to promote the offers by the company. By doing this, the company is expected to increase its profit by 10-12% and for this, the external and internal cost has to be reduced. It will be helpful for enhancing the quality of the products. The strategy of engagement has helped the company to increase customer involvement with the brand that also increased the brand value and customer loyalty (Long and Nasiry, 2019). This became possible by making the existing as well as the prospective customers engaged with the social media pages of the brand where the promotion of the lucrative offers has been made with the use of Google Adword. By adopting the strategies, the company will become successful in managing the cost of fashion products.
Analysis of proposal
From the above-mentioned strategies, the company is focused to reduce the price of the products. However, only reducing the price will not be helpful for the company to gain competitive advantages. In order to gain competitive advantages, the company needs to increase customer awareness about the latest cost reduction initiatives taken in order to sell the fashion garments. The first strategy of RACE will bring more customers to the company as it includes offering those discounts. In addition, the proposed strategy will be beneficial for the company to gain prospective customers who will show their interest in buying fashion garments. The introduction of lucrative offers will create brand popularity and will ensure growth in sales. The strategy of the Act includes the involvement of social media campaigns. This strategy will be beneficial in creating awareness about the discount offers and the lucrative offers to the users of social media. At present time, people are more engaged with social media platforms.
Therefore adopting effective digital marketing strategies, the company AtelierChiang Mai will be effective in creating a strong clientele base for the company and will gain effective profit by reducing the price. The engagement of celebrities and their endorsement with the novel offers will create a strong demand among the customers for the products. The off-line campaigns including word-of-mouth strategies will be helpful for the fashion company to increase awareness about the price reduction of the products. The more customers are getting aware of the discounts offered by the company the more it is beneficial for the company in order to increase brand awareness and increase the profit margin (Foroudi et al. 2018). The proposed strategy will also be helpful for the company to increase its profit margin from 10 to 12%. However, the company can also gain more profit than the assumed margin if it follows the proposed strategy more carefully. The company can ensure more profit if it focuses on increasing the production of quality garments. For this, the company is required to focus on controlling their quality of the manufactured products. In addition, the company by cutting the internal cost related to the production can reduce the price of the products. Besides, the external cost reduction will also be beneficial for the company in order to ensure reducing the price of the manufactured garments.
The conversion of the strategies will prove to be beneficial for the company to control the external and internal costs of the products. By creating customer loyalty, the company will ensure steady customers and this will help the company to grow in the market. The feedback gained from the customers by utilizing the social media platforms and various technological tools will help the company understand the growing trend in the contemporary market. In addition, it will also make the company identify and address the various requirements of the customers. By focusing on the feedback taken from the customers the company will be able to understand its area of improvement and will be helpful for enhancing the quality of the products. By engaging the customers on the various social media pages of the brand, the company will be benefited, as it will increase the involvement of the customers from all aspects of society. The price reduction strategy needs to be marketed among off-line and online users of garments. Effective digital media marketing will promote the various lucrative offers introduced by the company among the digital media users. The more the offer is promoted everywhere, the more people will be interested in the purchase of the products. Therefore, the adoption of the strategies will only bring profit to the company even with the price reduction. In addition, it will ensure the sustainability of the company Atelier Chiang Mai in the fashion industry and will increase customer engagement. Besides, the proposed strategy will help the company to gain competitive advantages and increase its brand position in the market.
Conclusion
From the above study, it can be concluded that the company Atelier Chiang Mai is associated with the production of superior quality garments. The company works closely with several manufacturers in Thailand and China. Those manufacturers are not only reliable but also know about the business process as they have worked closely with the company in order to produce superior quality clothes for many years. In addition, the company ensures short-time delivery of its garments when compared to the competitors of the company. The company has applied strategies that have been helpful in directing the creation of a strong customer base for the company Atelier Chiang Mai.
References
Clothes Production Partner In Thailand Asia. 2021. About The Atelier – Clothes Production Partner In Thailand Asia. [online] Available at: <https://chiang-mai-clothing.com/about-workshop/> [Accessed 12 May 2021].
Corporate Finance Institute. 2021. Competitive Advantage – Learn How a Competitive Advantage Works. [online] Available at: <https://corporatefinanceinstitute.com/resources/knowledge/strategy/competitive-advantage/> [Accessed 12 May 2021].
Foroudi, P., Jin, Z., Gupta, S., Foroudi, M.M. and Kitchen, P.J., 2018. Perceptional components of brand equity: Configuring the Symmetrical and Asymmetrical Paths to brand loyalty and brand purchase intention. Journal of Business Research, 89, pp.462-474.
Gareche, M., Hosseini, S.M. and Taheri, M., 2019. A comprehensive literature review in competitive advantages of businesses. International Journal of Advanced Studies in Humanities and Social Science, 8(3), pp.223-240.
Kharub, M. and Sharma, R., 2017. Comparative analyses of competitive advantage using Porter diamond model (the case of MSMEs in Himachal Pradesh). Competitiveness Review: An International Business Journal.
Lin, H.E., Hsu, I.C., Hsu, A.W. and Chung, H.M., 2020. Creating competitive advantages: Interactions between ambidextrous diversification strategy and contextual factors from a dynamic capability perspective. Technological Forecasting and Social Change, 154, p.119952.
Long, X. and Nasiry, J., 2019. Sustainability in the fast fashion industry. Available at SSRN 3486502.
Shan, S., Luo, Y., Zhou, Y. and Wei, Y., 2019. Big data analysis adaptation and enterprises’ competitive advantages: the perspective of dynamic capability and resource-based theories. Technology Analysis & Strategic Management, 31(4), pp.406-420.
Sutapa, S., Mulyana, M. and Wasitowati, W., 2017. The role of market orientation, creativity and innovation in creating competitive advantages and creative industry performance. JDM (Jurnal Dinamika Manajemen), 8(2), pp.152-166.
Todeschini, B.V., Cortimiglia, M.N., Callegaro-de-Menezes, D. and Ghezzi, A., 2017. Innovative and sustainable business models in the fashion industry: Entrepreneurial drivers, opportunities, and challenges. Business Horizons, 60(6), pp.759-770.
Vovchenko, N.G., Andreeva, A.V., Orobinskiy, A.S. and Filippov, Y.M., 2017. Competitive advantages of financial transactions on the basis of the blockchain technology in digital economy. European Research Studies, 20(3B), p.193.
Know more about UniqueSubmission’s other writing services:
