Porters Five Forces of Apex Essay

Introduction:

Gallerie Apex is the local manufacturing and retail wing of Apex Adelchi Footwear Limited (AAFL). With over 146 own retail outlets and 275 authorized resellers, Gallerie Apex ensures nationwide coverage of its diverse range of footwear for its consumers. Through its eight in-house brands, namely Venturini, Apex Men’s, Sprint, Moochie, Nino Rossi, Sandra Rosa, Apex Women’s and Apex Kids, Gallerie Apex carries a huge selection of shoes and sandals, ensuring that each of our valued customer finds the footwear that is just right for them.

Bargaining Power of Customers:

Customers carry large bargaining power as they can always threaten to buy rival products. Switching costs are typically very low due to rival’s products. The customers are mainly upper middle class and middle class young generation as well as kids in the mainly urban areas.

Bargaining Power of Suppliers:

Gallerie Apex has some supply sources which make goods. These sources make goods according to given design or requirements of Gallerie Apex.

Basically these supply sources make deed between Gallerie Apex and their factories that, sole & other component they will provide and they make complete shoes. Some names of supply sources are : Hanif Shoes, Century Shoes, Popy Shoes, Moochie Shoes, Coaster Footwear, Herald Shoes, Classic Footwear Ryan Shoe, Crown Leather, Keya Sandal , Home Land, Nashanan Trade, FN Enterprise, Prestige Bengal, King Ston, Bright Shine, Mayeem, Comfort Socks etc. Besides, they have their own factory named Shafipur Shoe Limited. Because of this huge number of supply sources, suppliers can exercise less pressure on them. Eventually the bargaining power of supplier is low.

Competitive Rivalry:

Bata Shoe Co. (Pvt.) Ltd. is the main competitor of Gallerie Apex. Gallerie Apex’s main competitor Bata Shoe Co. (Pvt.) Ltd. provides only durability. While Gallerie Apex is one step ahead in providing durability as well as innovative style, continuous upgrading and a strong brand image by injecting personality into products.

Threat of Substitute products:

Substitute for Gallerie Apex products come from rival manufacturers such as Bata Shoe Co. (Pvt.) Ltd., Jennys Footwear Ltd. etc.

Threat of New Entrants:

Threat of new entrants is low because like the existing competitors it is very difficult for the new entrants to copy multiple differentiation strategies adopted by Gallerie Apex advanced machines, skilled manpower, brand image, innovation and style.

Strategy:

Its competitiveness is based on to innovation, style, performance and continuous upgrading. The competitiveness that Gallerie Apex has achieved is also an outcome of its image differentiation by injecting personality to its products.Gallerie Apex has advanced machines and skilled manpower which make it possible to produce high quality footwear. As a SBU of Apex group, it also has good financial backup. As a partner company of Adelchi, Apex gets product designs from them which make it possible for them to follow Italian fashion trend. They have renowned brand image in the footwear market. Conclusion:

While AAFL has predominantly earned both critical and commercial fame through export of high quality leather footwear in the international arena, Gallerie Apex has sought to adeptly make use of that expertise to provide high quality, fashionable footwear to the Bangladeshi consumers. The company has revenues of USD 100 million in 2010 which has been possible because of its competitive advantage over the rival shoe manufacturers throughout the country.

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