In today’s retail market, you need to be nimble and one step ahead of the competition. Seemingly today, that means companies must understand their customers and understand their niche.  What do your customers want and how will you fill that need? Long established retailers such as Bowring, Jacob, and Bombay are filing for bankruptcy because they have not changed their business model.  Why is Holt Renfrew still thriving when they are charging such high prices and Jacob, who charges reasonably prices, has filed for bankruptcy?  It is because Holt Renfrew understands their target customer and are always working to meet their needs.  In the future, successful retailers have to be very efficient.  Either you are a mass distributor- such as Walmart, who have efficient distribution channels and can bring products to the consumers at low costs.  Or you are a niche market player that understands the product and service that the customers want. If you are not one of these two, your company will likely become another statistic in the long list of bankrupt retailers.

On the runways of New York, a new item is making a big splash.  New “smart watches” debuted at one of the most prestigious fashion shows in the world.  Not to be topped, Apple is about to launch a new, innovative smart watch known as the “iwatch”.  In a news release, Apple designer Jonathan Ive boldly predicted that the iwatch will bring down the Swiss watch industry. Is it possible that the entire Swiss watch industry can be taken down by a single product?  Or is Mr Ive simply trying a marketing ploy to stir up interest in their new product? While Apple does have a new product on the market, it is not enough to take down the Swiss industry.  People buy a Patek Phillip or Rolex watch, not just to tell time.  True, it does tell time accurate to a millisecond, but it is mainly a status symbol.  People wear a Rolex watch because they can afford the luxury of spending $10, 000 on an item that performs a function available on other devices, such as a cell phone.  Therefore, while the iwatch will certainly be a product of high demand, the Swiss industry is here to stay.

Large companies such as Nike are calling for better standards to ensure fair working conditions abroad; standards that would eliminate child labour and harsh working conditions. Are these companies really concerned about the well being of the foreign workers, or are they more concerned about losing the reputation of their firm? In order to please the shareholders, large corporations are driven by profits. Cheaper labour cost means higher profits. However, bad publicity and tarnished reputations can hurt the company’s image. Exposed companies feel disadvantaged if competitors continue to use abused workers. Everyone wants a level playing field.  Better working conditions require co-operative efforts and participation of all companies. Edward Freeman claims that a company’s long-term survival is dependent on whether the company adds value to ALL of its stakeholders. Companies cannot simply focus on the shareholders who want higher profits. To survive in the long run, companies must address all of its stakeholders including suppliers, employees, shareholders and society. As a result, if a company practices ethical supply chains and truly act as a good corporate citizen it will be recognized and rewarded. Don’t worry about the competitor’s practices. Do what is ethical and right and you will be rewarded.

 

 

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