Sana Fabrics
Sana Fabrics
CONTENTS
INTRODUCTION......................................................................................................................1
PEST Analysis...........................................................................................................................2
1. POLITICAL FACTORS.................................................................................................2
1.1 Import Restrictions..................................................................................................2
1.2 Tax Legislation........................................................................................................3
1.3 Wages Legislations..................................................................................................3
2. ECONOMIC FACTORS................................................................................................4
2.1 Inflation....................................................................................................................4
2.2 Interest Rate.............................................................................................................4
2.3 Currency Exchange Rate.........................................................................................5
3. SOCIAL FACTORS.......................................................................................................5
3.1 Lifestyle Trend.........................................................................................................5
3.2 Population Growth...................................................................................................6
3.3 Fashion Modernization............................................................................................6
4. TECHNOLOGICAL FACTOR......................................................................................7
4.1 Online Shopping......................................................................................................7
4.2 Laser Printing...........................................................................................................8
4.3 Digital Marketing.....................................................................................................8
BCG MATRIX...........................................................................................................................9
BCG Explanation..................................................................................................................13
SWOT Analysis.......................................................................................................................14
1. Strength.........................................................................................................................14
1.1 Offering..................................................................................................................14
1.2 Operating...............................................................................................................14
1.3 Prime Location.......................................................................................................14
1.4 Affordable Prices...................................................................................................14
2. Weakness.......................................................................................................................14
2.1 Dependent on Supplier...........................................................................................14
2.2 Less Place for Inventory........................................................................................15
2.3 No Advertisement..................................................................................................15
2.4 Heavy Rent of shop................................................................................................15
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Implementation of Strategic Analysis on Sana Fabrics
3. Opportunity...................................................................................................................15
3.1 Laser Printing.........................................................................................................15
3.2 Digital Marketing...................................................................................................15
3.3 Tailor......................................................................................................................15
4. Threats...........................................................................................................................15
4.1. Custom Duty..........................................................................................................15
4.2. Increase in Competition.........................................................................................16
4.3. Economic Downturn..............................................................................................16
4.4. Expansion of Competitor Business........................................................................16
Strategy Selection.....................................................................................................................16
Product life cycle......................................................................................................................17
1. Introductory...................................................................................................................17
2. Growth...........................................................................................................................17
3. Maturity.........................................................................................................................17
4. Decline..........................................................................................................................17
Scorpio technique.....................................................................................................................18
1. Customer.......................................................................................................................18
2. Industry Market.............................................................................................................18
3. Segmentation.................................................................................................................18
4. Positioning and targeting...............................................................................................18
5. Offering.........................................................................................................................19
6. Retention.......................................................................................................................19
7. Organization process and culture..................................................................................19
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Implementation of Strategic Analysis on Sana Fabrics
INTRODUCTION
The Fabrics industry uses a variety of natural (cotton, wool, etc.) and/or synthetic fibres to
produce fabric. It is a significant contributor to many national economies, encompassing
both small and large-scale operations worldwide. The classical method of categorizing the
industry involves grouping the manufacturing plants according to the fibre being processed,
that is, cotton, wool, or synthetics. The fabrics industry is very energy, water, and chemical-
intensive. About 60% of the energy is used by dyeing and finishing operations.
Sana Fabrics is cloth shop that is located in Akazai Shopping Centre Topi (Swabi). It was
established in 2015. They offer different variety of ladies and gents cloths including
children garments and all variety of baby girl and baby boy dresses. They purchase their
inventory from Faisalabad and Karachi factories and they also order the inventory
according to customers need. They are also dealing in uniforms of different schools and
colleges of the area. Moreover, they also provide sports kits as per demand of the
customers.
This report is basically related to strategy implementation, in which we will conduct SWOT
analysis, PEST analysis and BCG matrix of a Sana Fabrics. At the end of this report, BCG
strategy will be implemented and SCORPIO technique will be applied.
Operating
This shop is operated by Muhammad Tariq and his sons and also four employees work with
them and Muhammad Tariq manage this shop. Muhammad Tariq provide services at day
time while his son provides services at night time.
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PEST Analysis
PEST Analysis is a measurement tool which is used to assess markets for a product or a
business at a given time frame. PEST stands for Political, Economic, Social, and
Technological factors. Once these factors are analyzed, organizations can take better business
decisions. First, all the factors which can affect the fabrics business will be explained and
then we will discuss trends and forecasts of these factors.
1. POLITICAL FACTORS
To strengthen the local textile industry, Pakistan’s Federal Board of Revenue (FBR)
has imposed regulatory duty on the import of various textile items falling under the
Pakistan Customs Tariff (PCT) code of the first schedule.
a. Trend
FBR has imposed 50 percent duty on the articles of apparel and clothing
accessories, of leather or of composition leather and uppers of textile materials
will be charged 40 percent. Further, the government has taxed 10 percent on
woven fabrics of cotton containing 85 percent or more by weight of cotton, mixed
mainly or solely with manmade fibres and other woven fabrics of cotton, 8 percent
on woven fabrics of synthetic filament yarn and artificial filament yarn.
Hence, there is an increasing trend in restrictions on import of fabrics / textile
items. Resultantly, local fabric businesses including Sana Fabrics have been
improved and an increasing trend has been observed.
b. Forecast
Pakistani government is more concerned about indigenization of fabric industry.
Hence, it is forecasted that restrictions of fabrics items import will be strict in
future and local businesses like Sana Fabrics will grow further.
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Taxation / tax legislation for an industry plays a vital role in the development of that
industry. If an industry is taxed beyond a certain limit then product costs also
increase and customers prefer imported items over locally manufactured.
a. Trend
Pakistani government has applied a very friendly tax tariff for fabric industry.
They have also imposed duties on import on fabric and textile items which further
supports local fabric industry. Turn over tax on retailers of specified textile fabrics
and articles of apparel including readymade garments or fashion wear has been
reduced to 1% and sales tax has been reduced from 15% to 2%. Both these taxes
will be their final tax liability.
Foregoing in view, a reducing trend has been observed in taxes of fabrics industry.
And there is an increasing trend in business of fabrics industry (including Sana
Fabrics) in terms of taxations.
b. Forecast
Keeping in view the indigenization friendly policies of Pakistan government, a
further decrease and beneficial arrangements for fabrics industry are forecasted in
future. It will increase business of this industry.
Minimum wage law is the body of law which prohibits employers from hiring
employees or workers for less than a given hourly, daily or monthly minimum
wage. More than 90% of all countries have some kind of minimum wage legislation.
Minimum monthly wage has a direct impact on fabrics industry. People having
more income can afford more expensive stuff as compared to those with lower
income.
a. Trend
Just like other countries, Pakistan have continuously increased minimum wages
for workers to cope up with the inflation. It has been increased from Rs. 15,000 /
month (in 2017) for unskilled worker to Rs. 17,500 per month (in 2019). Thus, an
increasing trend has been observed in minimum wages per month in Pakistan and
so is the case with business of Sana Fabrics.
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b. Forecast
As there is a continuous increase in inflation in Pakistan, therefore, minimum
wages of workers will increase further in future.
2. ECONOMIC FACTORS
2.1 Inflation
a. Trend:
In Pakistan, inflation rate has kept on increasing during previous years (i.e. 2017-
2019). It happened due to change of government in 2018 and increase in foreign
debts. Fabrics products have also been affected by inflation i.e. cloth’s prices have
been increased considerably.
b. Forecast:
Keeping in view the instability in economy of the Pakistan due to current Covid-
19 situation, a further increase in inflation rate is expected.
The interest rate is the amount charged, expressed as a percentage of the principal,
by a lender to a borrower for the use of assets. The total interest on an amount lent
or borrowed depends on the principal sum, the interest rate, the compounding
frequency, and the length of time over which it is lent, deposited or borrowed. It is
the rate a bank or other lender charges to borrow its money, or the rate a bank pays
its savers for keeping money in an account.
a. Trend:
Pakistan has obtained a huge amount as loan from different foreign source. Interest
rate is directly related with loans so it has been increased in Pakistan from 4.04% (in
2017) to 10% (in 2019). It can be concluded that interest rate has an increasing trend
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b. Forecast:
As interest rate has been decreased considerably during 2020 due to Covid-19
situation, hence, a reduction in interest rate in Pakistan is forecasted.
In finance, currency exchange rate is the rate at which one currency will be
exchanged for another. It is also regarded as the value of one country's currency in
relation to another currency. Normally, the currencies are compared with US dollar.
a. Trend:
Pakistani rupee has been devalued consistently during past two decades. It is the
effect of increasing foreign debts and instability in economic and peace condition
in the country. Pakistan has borne a huge loss due to war on terror. As compared
to US dollar, Pakistan rupee has been devalued from 1 USD = PKR 108.5 (on 30-
06-2017) to
1 USD = PKR 155.1 (on 31-12-2019). The same has been further devalued to
1 USD = PKR 168.5 (on 09-08-2020).
b. Forecast:
Pakistani economy is not stable yet and covid-19 has further created uncertainty.
Therefore, a further devaluation of Pakistani Rupee is forecasted during coming
years.
3. SOCIAL FACTORS
Lifestyle changes include how people eat, dress, and communicate. Lifestyle of the
citizens strongly depend upon GDP per capita income. High GDP per capita
encourages people to live a high standard life and enjoying all the perks and
privileges. Moreover, literacy rate, employment rate and culture also affect lifestyle.
Educated and well-employed people tend to live a high standard life. They prefer
high class dressing, best vehicles, travelling and hoteling etc.
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a. Trend
Pakistan has been developing during previous years in terms of literacy rate and
employment rate. People have become more civilized and their dressing sense has
been improved considerably. Moreover, social media has further modified fashion
and design of garments among people. All these factors have contributed to an
increasing trend in the business of fabrics and garments.
b. Forecast
Keeping in view the current enhancement in lifestyle of Pakistani people, an
increasing trend is expected to be observed in coming few years.
a. Trend
Population of Pakistan has been continuously increasing with an annual increase
of 2.1%. Currently, it has crossed 230 million and became 5th largest population in
the world. Increasing population, increases the demand of fabrics and garments.
Therefore, use / demand of fabrics has shown increasing trend in Pakistan during
previous years.
b. Forecast
As, a consistent increase in population of Pakistan has been observed, therefore, a
further increase in demand of fabrics and garments is forecasted in future.
Dressing fashion, just like other fields of life, has been modernized / improved
during current years. Human being started with nakedness and reached to well-
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designed dresses after passing through several stages including use of leaves as
dress. In modern days, it is considered as integral part of a human’s life and
personality.
a. Trend
Fabrics and garments industry have been developed a lot in Pakistan in this
century. People have become fashion consciousness. The real credit goes to social
and electronic media which has developed a good fashion sense in the people.
Therefore, it is concluded that an increasing trend is present in fabrics’ fashion in
Pakistan.
b. Forecast
Keeping in view the increasing trend in fabrics’ fashion during last two decades in
Pakistan, it is forecasted that further enhancement will be maintained by Sana
Fabrics in the field of fashion.
4. TECHNOLOGICAL FACTOR
a. Trend
In modern age of information technology, many fields of life have been shifted to
internet. Accordingly, retailers and suppliers of different products have captured
the trend and started online shopping. Sana fabrics have also introduced facility of
online shopping for their customers with home delivery. An increasing trend has
been observed in online shopping of Sana Fabrics.
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b. Forecast
People are so much addicted to e-services that no one wants to visits markets or
shops physically. Therefore, an increase in online business of Sana Fabrics is
forecasted in future.
Laser printing is novel technique in the field of fabrics and garments. It has created
a revolutionary advancement in fabrics’ design. It is used to print desired design or
shape on a cloth. It has found best application for production of school / college
uniforms, sports kits and stylish designing of ladies’ dresses.
a. Trend
In recent years, use of laser printing in fabrics in Pakistan has kept on increasing.
Similarly, an increasing trend in the use of laser printing by Sana Fabrics has been
observed.
b. Forecast
Keeping in view the current advancement in the field of fabrics, further
improvement in printing technologies for fabrics industry is expected. Some
industries are working on introduction of 3D printing of designs on fabrics and
thin garments stuff.
Digital marketing is the component of marketing that utilizes internet and online
based digital technologies such as desktop computers, mobile phones and other
digital media and platforms to promote products and services. Its development
during the 1990s and 2000s, changed the way brands and businesses use technology
for marketing. New generations are mostly using social media sites; therefore,
digital marketing has become the most important marketing tool for businessmen.
a. Trend
Pakistan has been improving in the field of information technology during this
century. Specially, after introduction of 3G and 4G technology in internet, number
of internet users have increased considerably. People are mostly using Twitter,
Facebook, Whatsapp, Instagram etc as compared use of TV and newspapers.
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Therefore, Sana Fabrics have captured the trend and started digital marketing
through most of the social media sites. An increasing trend has been observed in
their business due to digital marketing.
b. Forecast
Keeping in view the increasing use of social media & internet and further
advancements in information technology, it is predicted that there will be a further
increase in digital marketing by Sana Fabrics in future.
BCG MATRIX
BCG matrix is a chart created by Bruce D. Henderson for the Boston Consulting Group in
1970 to help corporations to analyze their business units, that is, their product lines. This
helps the company to allocate resources and is used as an analytical tool in brand marketing,
product management, strategic management, and portfolio analysis. In this study, BCG
Matrix will be implemented on the business stats of Sana Fabrics for the years 2017-2019.
13,475,000-13,300,000/13,300,000*100
= 1.32%
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13,625,000-13,475,000/13,475,000*100
= 1.11%
Company Market
Companies MG = [(R2 – R1)/R1]X100
Growth
Sana Fabrics 3,650,000-3,565,000/3,565,000*100 2.38%
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BCG Explanation
Average market growth from year 2017 to 2018 is 1.32% and from 2018 to 2019 it is 1.11%
because of govt. change and also people are switching to other brands and there is less variety
in that area. Whereas average market share from 2017 to 2018 is 0.90 and from 2018 to 2019
it is 0.89.
From 2017 to 2018 Sana Fabrics have -0.97% market growth and market share of 0.96. In the
period 2018 to 2019 Sana Fabrics have growth of 2.38% and market share is 0.94. In 2018-19
Rawaj Shopping Centre offer too much variety in high prices because in that years he buys
new design and different variety of stuffs which is not available with Sana Fabrics.
From 2017 to 2018 Wadaan collection have 6.67% market growth and market share of 0.80.
In the period of 2018 to 2019 Wadaan collection have growth of -1.56% and market share of
0.81. Wadaan Collection growth is declined in 2018-19 because it is not offering the cloths
on affordable prices. Also, Wadaan collection market growth is too much declined because
Wadaan Collection offering different variety of ladies’ cloths, but due to insufficient capital
he can’t maintain his business in 2018-19. He does not have kids dresses and Gents cloths so
most of the customers are shifted towards Rawaj Shopping Centre and Sana Fabrics
From 2017 to 2018 Rawaj Shopping Centre have 2.27 market growth and market share of
1.04. In the period 2018 to 2019 Rawaj Shopping Centre have growth of 1.69 and market
share of 1.07. This is because Sana Fabrics have very affordable prices and have too much
variety of ladies and Gents cloths in good stuffs with also babies’ dresses. So, it is a market
leader among its competitors.
From 2017 to 2018 Afzal Fabrics have -2.54% market growth and market share of 0.79. In
the period 2018 to 2019 Afzal Fabrics have growth of 1.74% and market share of 0.75. Afzal
Fabrics increase has market growth because Afzal Fabrics invest high amount in
advertisement and also buy unique stuffs.
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SWOT Analysis
1. Strength
1.1 Offering
Offering all variety of ladies and gents’ cloths also including ready mate suites
available in 1Pc, 2Pcs, & 3Pcs for ladies.
1.2 Operating
Our location, the business model we will be operating on (one stop physical shop
and online shop), varieties of payment options, wide range of clothes and other
fashion accessories from local and international manufacturing brand.
Affordable prices then other competitor’s due to which Sana Fabrics gain large
amount of revenue.
2. Weakness
Sana Fabrics is too much dependent on third party suppliers because customers
demand new trend and fashion.
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Less place of inventory is other issue faced by Sana Fabrics due to which they have
to purchase inventory on daily basis according to customer demands.
2.3 No Advertisement
Sana Fabrics is located in the Entrance of Akazai Shopping Centre so Sana Fabrics
pay heavy rent as compare to competitors
3. Opportunity
Laser printing is novel technique in the field of fabrics and garments. It has created a
revolutionary advancement in fabrics’ design. It is used to print desired design or shape
on a cloth. Sana Fabrics use printer for production of school / college uniforms, sports
kits and stylish designing of ladies’ dresses. It is expected that it will be attract new
customer.
Digital marketing is the component of marketing that utilizes internet and online based
digital technologies such as desktop computers, mobile phones and other digital media
and platforms to promote products and services . Therefore, Sana Fabrics have captured
the trend and started digital marketing through most of the social media sites
3.3 Tailor
Sana Fabrics have facility of tailor. They provide services of new stitching and
alteration to their customers.
4. Threats
Custom duty increasing so there will less imported variety and that will lead to less
revenue generation.
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Another threat that may likely confront us is the arrival of a new clothing shop in
same location where Sana Fabrics is located.
We are quite aware that just like any other business, one of the major threats that we
are likely going to face is economic downturn. It is a fact that economic downturn
affects purchasing and spending power.
Expansion of competitor business will also have negative effect on the sales of Sana
Fabrics as competitor will increase its variety of cloths. So, customers will be
attracted toward competitors.
Strategy Selection
BCG based strategy will be used for my selected company. As BCG based strategies are
build harvest hold divest. From these I will use build strategy. As my Fabrics business is
nearest with market leader.
I will use BCG build strategy because I want to expand my selected company as business is
giving huge amount of profit. So, there should be expansion of business either have another
big shop mean branch of shop or shift your shop to another big shop so large number of
profits will be generated. Owner should do market research so that he will know about the
new trends and new variety of Fabrics in the market. As this is business giving huge market
share so expanding this business will double its customers and its profit margin. The main
reason for expanding the business is that market is growing day by day due to increase in
population more customers are added in market and value of market is increased.
My competitors don’t do a lot of research on the markets, so my company offers all the new
fashion Garments and Fabrics in the market according to customer needs. So that why, it
has high sales relative to its competitors, and the demand for the competitor clothes has
decreased in the market.
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The product life cycle describes the period during which an item is developed, placed on the
market and eventually withdrawn from the market. The cycle is divided into four stages:
introductory, growth, maturity and decline. The product life cycle is used in marketing to
decide when to advertise, to reduce prices, to explore new markets or create new packaging.
1. Introductory
When new design of fabrics is newly introduced to the market then Sana Fabrics
will be unable to generate profit from that. It will face difficulty in term of sales as
people are not aware of that design or that fashion.
2. Growth
The second one stage is growth, at this stage new design fabric is started generating
sales because new strategies are adopted by the companies. As my selected company
will do proper advertisement so growth of product will be increased day by day and
generate huge profit margin.
3. Maturity
The third stage is maturity, at this stage the products is at its peak and sales are
increased to the extent possible. The product is sold and generates profits for the
company because its advertising is well done and it has created its image in the minds
of customers and people have become aware of it.
4. Decline
The last and forth one stage is Decline, at this stage the product life cycle is when a
product dissolves as a result of decreased or negative growth. There is decrease in
sales of particular design clothes when new trend enters into the market.
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Scorpio technique
I have selected build strategy for my Fabrics Business. So, I will explain the impact of build
strategy on the following sectors:
Customer
Industry market
Segmentation
Positioning and targeting
Offering
Retention
Organization process and culture
1. Customer
There will be great impact on the customer as I am using build technique. I will
expand my business by making another branch or by investing more in inventory. If I
will make my shop at another place more customer will come it will lead to customer
value addition. My class of customer will be changed.
2. Industry Market
Sana Fabrics will be market oriented. They will follow the needs and demands of
customers. As their customer change so they will look new trends.
3. Segmentation
There will be proper market segmentation. Categories should be defined which type
of customer you are targeting. Provide services to both elite class as well as middle
class. Sana Fabrics segment will remain the same but they trying to focus on start of
elite class.
They will make brand image by giving free replacement services in case of any fault
in their clothes, and they will target according to the need and wants of new customers
in that particular area. Elite class main focus is on the latest variety so they have to
update their self-day by day.
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5. Offering
Sana Fabrics will offer new brands products to every years old individuals. As before
they are providing up to 18 year of age individuals. They will also offer special
printing to the customers on uppers.
6. Retention
Retention is how business can have loyal customer. Retention is same when you are
dealing with old customers. Sana Fabrics will provide services to the customers along
with different discount offers, so they can have loyal customers.
As Sana Fabrics is going to make new shop in Main Swabi market so culture will be
change because in Sana Fabrics there are middle class people so when they moving to
another market so they have to make changes better their process and services
according to the class in that particular area.
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