Case Study Description of Style Inc.: Fine Bespoke Tailoring
In 2016, the owners of Styles Inc. (Styles), a bespoke tailoring company in Toronto, Canada, needed to decide whether to discontinue the least profitable of the company's seven clothing lines or to increase that clothing line's retail selling price. Over the previous six years, Styles had been financially successful, and customer retention was a major factor in this success. However, competition was increasing and profits were shrinking. Should the owners drop the clothing line that had the lowest margin or increase its retail selling price? If they chose to increase the price, they would need to decide on the amount of the price increase. The owners wondered whether increasing the price would still enable them to meet their target contribution margin.
Authors :: Elizabeth M.A. Grasby, Richie Bloomfield
Swot Analysis of "Style Inc.: Fine Bespoke Tailoring" written by Elizabeth M.A. Grasby, Richie Bloomfield includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Bespoke Styles facing as an external strategic factors. Some of the topics covered in Style Inc.: Fine Bespoke Tailoring case study are - Strategic Management Strategies, and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Style Inc.: Fine Bespoke Tailoring casestudy better are - – increasing government debt because of Covid-19 spendings, technology disruption, banking and financial system is disrupted by Bitcoin and other crypto currencies, challanges to central banks by blockchain based private currencies, there is increasing trade war between United States & China, digital marketing is dominated by two big players Facebook and Google, competitive advantages are harder to sustain because of technology dispersion,
customer relationship management is fast transforming because of increasing concerns over data privacy, increasing commodity prices, etc
Introduction to SWOT Analysis of Style Inc.: Fine Bespoke Tailoring
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Style Inc.: Fine Bespoke Tailoring case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Bespoke Styles, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Bespoke Styles operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Style Inc.: Fine Bespoke Tailoring can be done for the following purposes –
1. Strategic planning using facts provided in Style Inc.: Fine Bespoke Tailoring case study
2. Improving business portfolio management of Bespoke Styles
3. Assessing feasibility of the new initiative in Innovation & Entrepreneurship field.
4. Making a Innovation & Entrepreneurship topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Bespoke Styles
Strengths Style Inc.: Fine Bespoke Tailoring | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Bespoke Styles in Style Inc.: Fine Bespoke Tailoring Harvard Business Review case study are -
Digital Transformation in Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For Bespoke Styles digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Bespoke Styles has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Low bargaining power of suppliers
– Suppliers of Bespoke Styles in the sector have low bargaining power. Style Inc.: Fine Bespoke Tailoring has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Bespoke Styles to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Bespoke Styles in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Analytics focus
– Bespoke Styles is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Elizabeth M.A. Grasby, Richie Bloomfield can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Organizational Resilience of Bespoke Styles
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Bespoke Styles does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Operational resilience
– The operational resilience strategy in the Style Inc.: Fine Bespoke Tailoring Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
High brand equity
– Bespoke Styles has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Bespoke Styles to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Learning organization
- Bespoke Styles is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Bespoke Styles is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Style Inc.: Fine Bespoke Tailoring Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Bespoke Styles is present in almost all the verticals within the industry. This has provided firm in Style Inc.: Fine Bespoke Tailoring case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Innovation driven organization
– Bespoke Styles is one of the most innovative firm in sector. Manager in Style Inc.: Fine Bespoke Tailoring Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Cross disciplinary teams
– Horizontal connected teams at the Bespoke Styles are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
High switching costs
– The high switching costs that Bespoke Styles has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Weaknesses Style Inc.: Fine Bespoke Tailoring | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Style Inc.: Fine Bespoke Tailoring are -
Products dominated business model
– Even though Bespoke Styles has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Style Inc.: Fine Bespoke Tailoring should strive to include more intangible value offerings along with its core products and services.
Skills based hiring
– The stress on hiring functional specialists at Bespoke Styles has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
High bargaining power of channel partners
– Because of the regulatory requirements, Elizabeth M.A. Grasby, Richie Bloomfield suggests that, Bespoke Styles is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Bespoke Styles is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Style Inc.: Fine Bespoke Tailoring can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Style Inc.: Fine Bespoke Tailoring, is just above the industry average. Bespoke Styles needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
High cash cycle compare to competitors
Bespoke Styles has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Workers concerns about automation
– As automation is fast increasing in the segment, Bespoke Styles needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Low market penetration in new markets
– Outside its home market of Bespoke Styles, firm in the HBR case study Style Inc.: Fine Bespoke Tailoring needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High operating costs
– Compare to the competitors, firm in the HBR case study Style Inc.: Fine Bespoke Tailoring has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Bespoke Styles 's lucrative customers.
Interest costs
– Compare to the competition, Bespoke Styles has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Lack of clear differentiation of Bespoke Styles products
– To increase the profitability and margins on the products, Bespoke Styles needs to provide more differentiated products than what it is currently offering in the marketplace.
Opportunities Style Inc.: Fine Bespoke Tailoring | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Style Inc.: Fine Bespoke Tailoring are -
Better consumer reach
– The expansion of the 5G network will help Bespoke Styles to increase its market reach. Bespoke Styles will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Buying journey improvements
– Bespoke Styles can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Style Inc.: Fine Bespoke Tailoring suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Innovation & Entrepreneurship industry, but it has also influenced the consumer preferences. Bespoke Styles can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Innovation & Entrepreneurship industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Bespoke Styles can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Bespoke Styles can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Bespoke Styles can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Leveraging digital technologies
– Bespoke Styles can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Developing new processes and practices
– Bespoke Styles can develop new processes and procedures in Innovation & Entrepreneurship industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Bespoke Styles in the consumer business. Now Bespoke Styles can target international markets with far fewer capital restrictions requirements than the existing system.
Learning at scale
– Online learning technologies has now opened space for Bespoke Styles to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Loyalty marketing
– Bespoke Styles has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Low interest rates
– Even though inflation is raising its head in most developed economies, Bespoke Styles can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Using analytics as competitive advantage
– Bespoke Styles has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Style Inc.: Fine Bespoke Tailoring - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Bespoke Styles to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Creating value in data economy
– The success of analytics program of Bespoke Styles has opened avenues for new revenue streams for the organization in the industry. This can help Bespoke Styles to build a more holistic ecosystem as suggested in the Style Inc.: Fine Bespoke Tailoring case study. Bespoke Styles can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats Style Inc.: Fine Bespoke Tailoring External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Style Inc.: Fine Bespoke Tailoring are -
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Bespoke Styles in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Bespoke Styles in the Innovation & Entrepreneurship industry. The Innovation & Entrepreneurship industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Regulatory challenges
– Bespoke Styles needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Innovation & Entrepreneurship industry regulations.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Bespoke Styles with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Bespoke Styles needs to understand the core reasons impacting the Innovation & Entrepreneurship industry. This will help it in building a better workplace.
Easy access to finance
– Easy access to finance in Innovation & Entrepreneurship field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Bespoke Styles can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Bespoke Styles can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Style Inc.: Fine Bespoke Tailoring .
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Style Inc.: Fine Bespoke Tailoring, Bespoke Styles may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Innovation & Entrepreneurship .
Environmental challenges
– Bespoke Styles needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Bespoke Styles can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Bespoke Styles will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Bespoke Styles business can come under increasing regulations regarding data privacy, data security, etc.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Bespoke Styles.
Technology acceleration in Forth Industrial Revolution
– Bespoke Styles has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Bespoke Styles needs to keep up with the evolution of technology in the Innovation & Entrepreneurship sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Weighted SWOT Analysis of Style Inc.: Fine Bespoke Tailoring Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Style Inc.: Fine Bespoke Tailoring needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Style Inc.: Fine Bespoke Tailoring is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Style Inc.: Fine Bespoke Tailoring is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Style Inc.: Fine Bespoke Tailoring is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Bespoke Styles needs to make to build a sustainable competitive advantage.
