Company Overview

Discuss the Brazilian fashion retail market and industry in order to enable Miller’s Retail Ltd. to successfully enter into the Brazilian market.

The purpose of this report is to analyse the current business situation of Miller’s Retail Ltd. as well as to assess the company’s growth opportunities in the global market. For this report, Brazil is selected as the target market in which the company plans to enter as part of strategic goal to create a global presence. This report covers the brief over of the company vis-à-vis its position in the Australian market. The report further discusses the macro and micro environmental factors present in the Brazilian market and its effect on the proposed business of the company. In addition, the report has also discussed the size of the industry and growth opportunity in the selected market with the help of Porter’s five forces. Finally, the report also discusses marketing mix and strategic choice that the company can undertake to successfully enter into the Brazilian market (Cortez et al. 2014).

Miller’s retail ltd. is an Australian fashion retail business that markets women’s apparels and accessories and is one of the country’s largest retailers. The company was established in 1993 and was floated at the Australian stock exchange in 1998 by its founder Ian Miller. Currently the company operates as a chain of total 380 stores across Australia and New Zealand and is the largest women’s retailer nationally. Further, the company has been re-invigorating itself as a brand and exploring the global markets in order to appeal wide range of customers (Millers.com.au 2016).

It can be discussed with the help of PESTLE analysis as –

PESTLE analysis

The PESTLE analysis of Brazilian market can discussed as –

Political factors: the government is in stable state; however, corruption is a major concern and for any company or private to operate in the Brazilian market have to deal with these issues, that also presents ethical dilemma for the companies. The country is a remember of World Trade Organization and Cairns Group (Kennedy 2013).

Economic factors: the economic conditions of the country is favorable for the Miller’s Retail Ltd as Brazil is the seventh largest economy in terms of purchasing power parity and GDP and operates as a free economy. The economy is developing at a rate of 5% p.a. and greater than the global average. The inflation rate in the country is stable at around 5 to 6% also the interest rate in the country is around 11% that aims at increasing the flow of money in the market  (Bahadir et al. 2015).

Comprehensive Country Research and Analysis

Social factors: the overall standard of living in the country is increasing as the education and basic infrastructure has improved over time. The number of women in work force is substantial particularly in the lower paid positions. Economically independent women are favorable for the Miller’s Retail ltd as its main consumers are women (Kennedy 2013).   

Technological factors: technological factors that would affect the business of Miller’s are less advanced as the country is labor intensive and faces challenges in fields of science and technology (Ibarra et al. 2013).

Legal factors: legal factors affecting the business are governed by various trade agreements and existing laws of the individual countries that the Miller Retails have to comply.

Environmental factors: environment protectionist environmental laws and regulations have to followed. Therefore, for the company to operate in the Brazilian market has to follow international standards as currently is the largest emitter of green house gas and the country is under international pressure to reduce green house emissions (Ibarra et al. 2013).

 The microenvironment analysis refers to analysis of the industry, it enables to analyse the attractive of the market and level of competition in the market. For Brazilian fashion retail industry, it can be discussed as –

Threat of new entrants: the Brazilian fashion retail industry is well establish, therefore, threat of new entrants is low and for a new player to enter into the market would require huge initial investments to establish its supply chain and brand awareness among the customers.

Threat of substitutes: The retail fashion industry has fewer substitutes as clothing is the basic human requirement and cannot be avoided. Therefore, threat of substitutes is low.

Bargaining power of buyers: the economy of Brazil is based on open economy and many sellers mark the industry. Therefore, customers have high bargaining power and dictate the terms of the business (Fernie et al. 2015). 

Bargaining power of suppliers: The bargaining power of suppliers is low as the industry is not dependent on suppliers as their most of the companies have implemented back ward integrating and have their own strategic suppliers that exclusively supplies to their business partners (Castaldo et al. 2013). 

Industry rivalry: The inter industry rivalry is high as there are many players who compete for the same target customers and operates in the same business with limited opportunity of brand differentiation (Kennedy 2013).  

Segmentation: The market of the Brazil can be segmented on the basis of age, income group, and geographical segmentation.

Porter’s Five Forces

Targeting: the major customers of the Miller are the urban female customers between the age group of 18-40 (Moyano and Lengler 2013).

Positioning positioning is pre marketing that aims at creating a favorable impression of the brand in the minds of target customers. The company can position itself as high-end retail brand that provides high quality products with best in class services and value for their customers’ price (Miotto and Parente 2015).         

The marketing mix for the Miller’s retail for Brazilian market can be discussed as –

Product: the product of Miller’s retail are women fashion clothing and accessories. The company provides vast assortment of fashion merchandise ranging from home wear to party wears.

Price: In order to successful in the Brazilian market, the company needs to adopt cost leadership pricing strategy as the customers demand quality products at a reasonable prices. Other pricing strategies that can be employed are price differentiation by providing discounts (Moyano and Lengler 2013).

Place: the distribution system of the company is primarily dependent on its physical stores, however, the company can also develop online business model to meet the demands of modern customers (Miotto and Parente 2015).

Promotion: Miller’s Retail Ltd., can promote its self in the Brazilian market through online advertising, magazines, billboards, etc. (Schlegelmilch 2016).

In order, to be successful in the Brazilian market, Miller’s retail can enter into strategic alliance with some companies that targets the similar customer group (e.g. Lojas Marisa). The reason being, Miller’s retail is the Australian company that has limited knowledge of the Brazilian market. Therefore, the company can achieve its objective of market growth more effectively as the company would require less investments and risks can be minimized (West et al. 2015).     

Conclusion

From the above discussion, it can be concluded that Miller’s Retail can enter into the Brazilian market as the country’s overall business environment presents a favorable outlook for the company. In addition, with the effective strategic alliance with existing Brazilian company and proper marketing mix formulation, the company can establish itself in the Brazilian market.

References

Bahadir, S.C., Bharadwaj, S.G. and Srivastava, R.K., 2015. Marketing mix and brand sales in global markets: Examining the contingent role of country-market characteristics. Journal of International Business Studies, 46(5), pp.596-619.

Castaldo, S., Grosso, M. and Premazzi, K., 2013. Retail and channel marketing. Edward Elgar Publishing.   

Cortez, M.A., Tu, N.T., Van Anh, D., Ng, B.Z. and Vegafria, E., 2014. Fast fashion quadrangle: An analysis. Academy of Marketing Studies Journal,18(1), p.1.

Fernie, J., Fernie, S. and Moore, C., 2015. Principles of retailing. Routledge.

Ibarra, G., Cindy, J., Ogliari, A. and de Abreu, A.F., 2013. A Contribution to Guide the Use of Support Tools for Technology Roadmapping: a Case Study in the Clothing industry. Journal of technology management & innovation,8(4), pp.153-169.

Kennedy, B., 2013. Retail Marketing Theory In Fashion Retailing Context.

McCormick, H., Cartwright, J., Perry, P., Barnes, L., Lynch, S. and Ball, G., 2014. Fashion retailing–past, present and future. Textile Progress, 46(3), pp.227-321.

Millers.com.au. 2016. Women’s clothing | Shop for clothes online – Fast shipping! | Millers Buy women’s clothing online.. [online] Available at: https://www.millers.com.au/ [Accessed 31 May 2016].

Miotto, A.P. and Parente, J.G., 2015. Retail evolution model in emerging markets: apparel store formats in Brazil. International Journal of Retail & Distribution Management, 43(3), pp.242-260.

Moyano, C.M. and Lengler, J., 2013. Exploring the Relationships Among Personal Values, Self-Concept´ s Affective Security Dimension and Female Consumption Behavior: Perspectives from the Brazilian Retail Experience.Revista de Administração FACES Journal, 12(1).

Schlegelmilch, B.B., 2016. Segmenting Targeting and Positioning in Global Markets. In Global Marketing Strategy (pp. 63-82). Springer International Publishing.

West, D., Ford, J. and Ibrahim, E., 2015. Strategic marketing: creating competitive advantage. Oxford University Press.