Presentation on

C&J Clark (Clarks)

Prepared To

Md. Tarikul IslamAssistant Professor of marketing

DBA, IIUC-DC.

Md. Tarikul IslamAssistant Professor of marketing

DBA, IIUC-DC.

Prepared BySerial No.

Name ID No.

1. Md. Tareq Abdullah B091841

2. Md. Ashiqur Rahman B091838

3. Md. Kamrul Islam Talukder B091816

4. Md. Nasir Uddin B092006

Company Overview

C&J Clark International Ltd. (Clarks) is a world-leading manufacturer and retailer of footwear. It offers wedge heels, sandals, sneakers, boots, brogues, shoes, pumps, slippers, loafers, canvas, handbags, umbrellas and small leather goods. The company sells its products online. It was founded in 1825 by brothers Cyrus and James Clark and is based in Street, in Somerset, United Kingdom.

Q-1: Using Porter’s five-forces model, how attractive do you think the shoe industry is? Apply the model to both manufacturing and retailing.

Porter’s Five forces Model

Factors affecting bargaining power of suppliers

Supplier bargaining power is stronger when: Industry members incur high cost in switching their

purchases to attractive suppliers. There are only a few suppliers of a particular input.

Supplier bargaining power is weaker when: Available input supplies from many suppliers at the market

price. Seller switching percentage is low. Goods substitute inputs exists.

For C&J Clark

C&J clark is a company based in the UK.Clarks was UK market leader for shoes. In 1990s 75% of the shoes involved had been

manufactured out side the UK with relatively low labor costs.

But when the seep skin business was moved to separate business in UK then they made hygienic boots and shoes and all types of shoes in UK.

Factors affecting bargaining power of buyers

Buyer bargaining power is stronger when: Buyer switching costs to competing brands are low. Buyers demand is week or declining. Large volume buyers are important.

Buyer bargaining power is weaker when: Buyer purchase the item infrequently or in small

quantities. Buyer switching costs to competing brands are high.

For C&J ClarkHere bargaining power is high.Because different types of cost and competing

brand available. And people have blind trust also.

The market was much more competitive as an increasing number of imported brands was introduced and gained popularity.

Customer testes were changing.

Rivalry among competing sellersTypical weapons for getting rivals and attracting

buyers:Low price.More different features.Better product performance.High quality.Wider collection of models and styels.Stronger product innovation capabilities.

For C&J ClarkBritish shoe company(BSC)sometimes competing

retail outlets, low and medium price shoes for people up to middle age.

Curtess, Manfield, Saxone, Freeman Hardy Willies, Dolcis are competing Good quality, medium price, Stylish shoes for fashion concious youngsters.

Marks and spencer was dominant with low priced shoes for older people.

Clarks in a strong position with medium priced and better quality shoes for a number of age groups.

Factors Affecting Threat of Entry Entry threats are weaker when: Entry barriers are high.Existing competitors are struggling to earn

health profit.The industries outlook is risky and uncertain.Buyer demand is growing slowly

For C&J Clark

Here Entry threats are weake.Because Existing competitors are struggling

to earn health profit.Sales had fallen. High street property rents

remain high.High existing barriers. Customer test were

changing.

Factors Affecting Threat of substitutesThe existence of products outside of the realm of the

common product boundaries increases the propensity of customers to switch to alternatives. Note that this should not be confused with competitors' similar products but entirely different ones instead.

Buyer tendency to substituteRelative price performance of substituteBuyer switching costsPerceived level of product differentiationNumber of substitute products available in the marketEase of substitution. Information-based products are

more prone to substitution, as online product can easily replace material product.

Substandard productQuality depreciation

For C&J Clark

Clarks not only produce shoe but also produce different lather items. They produce shoe for all types of customer like men, women, kids, old age people, different age different model, umbrellas, lather bag and small leather goods .

2. How does Clarks add value? How would you summarize the company’s strategic (competitive) position in 1990? In

2000? Do you believe that Clarks is now in a much stronger position than it was ten years ago?

The 1990s Clarks was UK market leader for shoes. Well Know as both a retailer the name Clarks is typicallyassociated with children’s shoes. Especially among the older generations who grew up in Clarks sandals. Manyyears the company had become associated whit sturdyand sensible shoes for adults as well as children. The footwear market in the UK exceeded $5 billion annual sales for the first time in 1999.During the mid-late 1990s the growth rate had exceeded the prevailingrate of inflation.

Continue......

The highest growth was in children's shoes of all types although these account for less than one-fifth of the market overall. During the 1990 the population of trainers and other

sports shoes, backed by heavy brand advertising, has grown dramatically, as has the popularity of shoes associated with designer names.

The company wants to be recognized as an international casual shoes company. so, the Clarks value added the company in different step by step.

Company strategic 1990Every body knows that different kind of company have taken some competitive strategy. So, Clarks have taken some competitive strategic: The company have manufactured three item shoes Clarks (mostly

associated with children’s and comfortable semiformal shoes), k (targeted at mature adult) and Ravel (high fashion shoes).

Company 60% of the shoes were manufactured in the UK and 40% were produced in Portugal, Italy and Brazil.

Company thirty new outlets were opened in 1990 to complement the existing 850 concessions in department and fashion stores.

Company manufacturing costs were relatively expensive, making it relatively vulnerable to cheaper imports. As sales declined the company had to reduce its costs.

Company strategic 2000 In 2000 company add new image is focused on shoes

that are fashionable and casual.The company provide premium quality and expert

service.Clarks shoes are focused mainly on the 35-45 age

group and the k brand on the over 50s.The company are five distinct ranges of man and

woman shoes. In 2000 company are separate ranges comprise four age

groups First shoes, 2-4, 5-7 and 8 years and over as well as a range of trainers with their own brands identity.

Opinion

I know that Clarks was UK market leader for shoes ten years ago. Clarks try every years still here this position. Clarks popularity to trainers and other sports shoes, backed by heavy brand advertising and popularity of shoes associated with designer names. The company have used many competitive strategy. So, any other company competition level is not developed by Clarks. In part to achieve this production in the UK would be increased against the current trend. The company wants to be recognized as an international casual shoe company. So, I believe that Clarks is now in much stronger position than it was ten years ago.

3. Evaluate the changes introduced by Parker in the last five years. To what extent do you think the current results can be attributed to these changes, and to what extent might they be the result of external circumstances?

C&J Clark’s pre-tax profits of last five years:

To what extent do you think the current results can be attributed to these changes

The changes are:Clarks is world leader for ‘brown shoes’ and shoe-care

products and a major player in children’s shoes.Table showed that Clarks is overall market leader in

the UK with 10% of sales – up 2% from 1990.The industry remains very fragmented and globally

static.Sales are strong in the USA.The company is also particularly successful in Japan

Continue...Clarks has a very wide range of practical (work) shoes,

casuals, sandals and children’s wear.They are not the highest price, but they are certainly

not the cheapest. Of generally high quality, they represent value for money.

The new image is focused on shoes that are fashionable and casual. The company claims that it offers individual designs, exceptional comfort, premium quality and expert service.

There are five distinct ranges of women’s shoes: formal, smart (with thicker soles), casual, boots, and Springer's – semiformal casual shoes with soft soles sold under the K brand.

Result of external circumstances:

Excluding Nike and Reebok – manufacturers of trainers and sports shoes and which together with Adidas account for 13% of the UK market – Marks and Spencer follows Clarks with a 5% share,1% less than its share 1990. In 1999 the M&S profit margin on shoes was reported to be 6.6%, whereas a year earlier it had been 14.1 %. The company had lost some of its international sales as a result of the high pound.

4. If you were Tim Parker, what future strategies would you be considering? Is the family ownership arelative strength or a relative drawback?

C&J Clark strategy:

Strategy

“Strategy is the direction and scope of an organization over the long-term: which achieves advantage for the organization through its configuration of resources within a challenging environment, to meet the needs of markets and to fulfill stakeholder expectations"

SWOT Analysis

Strategy Of Tim Parker

Cost optimization and margin improvement.Logistics and demand based production.Tax-free zone manufacturing base.Rationalizing and re-engineering.