Uniqlo Case

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in Vietnam the mobile network mainly is 3G network but 4G network still planned to develop(Business Monitor2014). This situation may not too favorable for online business but for supporting to gather market data from internet is attainable. The possession rate of personal computer rate still in low level in Vietnam(Business Monitor2014). That means Uniqlo may not suitable to promote online shopping system in Vietnam before Vietnam overcome the problem.

Porters 5 force model also can analysis the external condition of the market. Porter claimed potential entrants, buyer bargaining power, supplier bargaining power, threat of substitute products and competitive rivalry(Porter 1980).

The buyer bargaining power is weak because there is no other choice of the casual wear chain stores. GAP, H&M and ZARA have been enter Vietnam market yet. Uniqlo can have advantage to gain more market share with no strong competitors.

The supplier bargaining power is weak due to Vietnam have strong textile industry with numerous of factories. Uniqlo can find the lowest cost factory to produce the products.

The economic status become stable and developing fast the other competitor may want to enter this market too. So there are few potential entrants. Clothing is not the special product in Vietnam. Then Uniqlo’s products can be instead easily.

In Vietnam there is haven’t any same industry competitors which is international casual wear retailing company.

Internal Analysis

For company internal analysis, Drummond Marketing Assets theory will be mentioned. Drummond suggested a company should with image and reputation, country of origin distribution networks, corporate culture and joint venture/alliances(Drummond et al. 2003).

Image and reputation

Uniqlo with high reputation in casual wear retailing business and the number of the retailing store is over 1,400(Fast Retailing 2014).It is a big and successful company and have big market share around the world. The factors of Uniqlo can have high reputation not only the large business scale but also their high quality of their products. Uniqlo with a Material Development Team to purchase high quality material at low price from the manufacturers( Fast Retailing 2014). Uniqlo set up the Customer Centre to receive the feedback from customer. Then improve the product and service quality to satisfy the customer. Therefore it build up the good image to public.

Country of origin

The country of origin of Uniqlo is Japan. The product from Japan or Japanese brands always with high quality and safe. It can convince the customer to buy it.

Distribution network

Uniqlo built up a wide distribution network around the world. In each market it monitor the local factories from manufacturing to store selling. It want to ensure the process is affluent. Moreover Uniqlo is a experienced worldwide trading company it has method and approach to handle the distribution problem.

Corporate culture

Uniqlo’s corporate culture is creating high quality product with low cost to satisfy customers value on worldwide(Fast Retailing 2014). Uniqlo using the unique material to produce new product such as HEATTECH innerwear and ultra light down jackets.

Joint venture

The business of Uniqlo in Vietnam should be joint venture with the local factories. So Uniqlo can reduce the set up cost for manufacture. The other joint venture partner is the local department store. Uniqlo sell their product from the department store using the fame of the department store to promote Uniqlo. Then Uniqlo can increase the awareness and reduce the promotion cost at the same time.

Market research of the new potential market

Accessibility

Accessibility in Vietnam is medium, the profit tax is low and low cost to start the business. The tariff in Vietnam is reducing and lower than other neighboring countries to show the benefit to the international companies. Vietnam with high proportion of younger workers they are well-educated with high rates of numeracy and literacy for its income level. The problem of corruption in Vietnam is serious a lot of foreign company stop enter this market cause of the corruption problem. Also the percentage of bad debts is high compare with other southeast Asia countries.

Market size

Market size is not big right now because of high population of people is living in villages(Business Monitor2014). The wealth contribution in Vietnam is not balance. Only some of them live in city have higher income. Vietnam have better economic development compare with Cambodia and Laos but still can’t compete with Thailand and Philippines. These countries may more attractive than Vietnam for some companies. Depends on this situation, it is not a favorable market.