SOUL COLLECTION

PRESENTED BY

AIMUN KHAWJA
MBA DEPATTMENT

UNIVERSITY OFVETERINARY AND ANIMAL

SCIENCES
 Executive Summary

Soul has a vision to become a leader in its segment. It has a vibrant workforce that
works towards in meeting the organizational goals. They are in their infancy but
have aggressive plans to increase their presence in the market. The team led by Mr.
Salman is very optimistic about what lies ahead and are focused in meeting the
challenges they face from competitors like Shu 8, Stylo, and Metro etc.

Their pricing strategy is two fold i.e. to stay competitive and to increase sales;
hence increasing their market share. The products on offer are trendy and at the
same time provide good value for money. Their Visual Merchandising is at par
with the competitors and provides a favorable shopping experience for their
customers. Their sales staff is efficient and is adept at providing a good customer
service.
 INTRODUCTION

Introduction of Servis Pvt. Limited:

Servis Group is Pakistan's largest footwear manufacturer and exporter. It also has
interests in retailing. Its Group Company, SSC PRIVATE LIMITED, is the
country's largest retailer and wholesaler of footwear. The Group has diversified
interests in rubber products including tyres and in defense industry products. The
Group was set up in 1958 and today has sales of more than PKR 9 billion. Servis
Group employs close to 8000 people in its Group Companies.

Servis Industries Limited

SIL is a public limited company listed on the stock exchanges of Pakistan. It has
annual revenue of USD 80 million. It is the largest manufacturer of footwear and
tyres & tubes for two-wheelers, and has been the largest exporter of footwear from
Pakistan for the last 10 years.

The company employs more than 5,000 people in its facilities located in Gujrat
and Muridke. The company's products are exported primarily to Germany, Italy,
France and UK.

Introduction of Soul

Soul Collections (Pvt.) Ltd. is a Pakistani ladies footwear brand that aims to
provide a one stop shopping facility regarding quality footwear and accessories.
Soul Collections is not just about selling quality footwear; it wants to be identified
with providing the ultimate shopping experience to our customers.

Soul Collections plans to spread its network all over Pakistan and reach out to all
the major areas of this region and be known as ‘The # 1 Choice in the Ladies
Footwear Brands of Pakistan’. Soul Collections is all about fusing the exotic and
colorful local aesthetics with international shoe standards. The design range at
Soul Collections is not restricted to a particular segment of the Pakistani
consumers, both in its versatility and its affordability.

Our knowledgeable staff is trained to deliver excellent customer service, with the
objective of turning customers into loyal clients, ensuring the future growth of the
company.

HISTORY OF
ORGANIZATION

The team that conceived Soul Collections has half a century of experience in the
footwear business and is trusted by millions of satisfied users.

Soul Collections launched its first outlet on the 30th of April, 2007 in the well-
known Liberty Market - the heart of Lahore, which itself is the heart of
Pakistan. The response was overwhelming and the customer's feedback in the
following days, regarding the product quality and the services, was more than
encouraging and strengthens our belief in our policies. Soul Collections
products are a unique blend of art and technology. Fashion artists create the
characteristic look and style of Soul while modern production techniques
ensure top of the line quality and value. Soul offers exclusive ranges of bags,
bridal shoes, indoor and outdoor shoes, party wear and professional wear.
 Vision Statement

Exceeding customer's expectation is the company's mission. Target is to

accommodate customer within 90 seconds. The product faults and repairs are
served for a limited period of time as per company policy.

Mission Statement

 To be a result oriented and profitable Company by consistently improving

market share, quality, diversity, availability, presentation, reliability and
customer acceptance.
 To emerge as a growth oriented concern ensuring optimum return and value
addition to its shareholders to ensure cost consciousness in decision-making
and operations without compromising the commitment to quality.

 To create an efficient resource management and conducive business

environment. Evolving an effective leadership by creating a highly
professional and motivated management team fully equipped to meet any
challenge.

 To keep abreast with modern technology and designs to optimize production

and enhance brand image to attain international recognition for the
Company's products. To set up highly ethical business standards and be a
good corporate citizen, contributing towards the development of the national
economy and assisting charitable causes to adopt appropriate safety rules
and environment friendly policies.
Organic/mechanistic:
Soul collection is a mechanistic organization in its structure. These structures tend
to be efficiency machines & it cannot change itself with the changing
environmental conditions. Soul’s sales team numbers around 100 and it includes
the shop managers. Each shop managers then reports to the Retail Network
Coordinator (RNC) who then reports to the Retail Operations Manager. The
ROM reports directly to the GM and keeps the other departments about the sales
progress. So far they have managed to develop as a team. However as they grow,
they would need to have Area Managers who would hen manage their respective
areas.

Flat/ Tall structure:

Soul collection is TALL in its structure so it has a complex flow of information.

Centralization/ Decentralization:

Soul collection organizational structure is based on centralization. The degree to

which decision-making is concentrated at upper levels of the organization is
known as centralization. In centralization organization are rigidly & tightly
controlled.

Formalization:

Formalization refers to how standardized an organization’s jobs are and the extent
to which employee behavior is guided by rules and procedures. Soul collection’s
organizational structure is informal because it relies less on strict rules and
standardization to guide and regulate employee behavior.
Span of control: Span of control guide about the number of employees a
manager can efficiently and effectively manage. Soul Collection has narrow span
of control.
 Organizational Design

Innovation is the key driving force behind Soul and in keeping with the spirit of
creativity; Soul Collections has created a milestone in the world of fashion with
the world’s first reversible shoe. Soul Mirror is a revolutionary style of shoe that
combines art and fashion to create something truly unique. A stylish shoe that can
be worn front to back or back to front, Soul Mirror integrates two amazing designs
in one shoe.

Product Offering:

Soul sells upscale women's shoes. Soul Collection has a wide range of fancy and
casual shoe collection .The product development strategy focuses firstly on the
collection bridal shoe. These are all cottage industry products. Apart from shoes
SC are also offer various type of designed handbags. The focus is to provide
superior quality that gives comfort with aesthetics.

The experienced management decides over the design of the shoe to be able to sell
in considerable amount at the outlet under this brand. Customers associations with
the brand are different with different brand; one type of product may sell easily
less than one brand and does not sell well under the other brand name.

The general categories of shoes that will be sold are:

 BRIDAL WEAR
 PARTY WEAR
 INDOOR
  OUTDOOR
 HAND BAGS
 Design Turnover

ORGANIZING THROUGH HUMAN RESOURCE POLICIES:

• Tracking competitor’s employees

• Train retail staff
• Pay high salaries to retail staff then of the competitors to retain them and to
create a high level of motivation.
• Retail staff should be presentable
• No high education required for backend employees

The successful retail strategy is to be better than your competition in one of the
following three key areas:

a) Price
b) Service
c) Product

At the same time, you must also remain competitive in the other two.

 Like all major retailers in Pakistan, Soul has a merchandising buying

process that allows its buyers to forecast with some degree of accuracy what
to purchase and when to have it delivered. This greatly assists the company
in attaining its sales and gross margin goals. The foundation of this planning
process is the six month merchandise plan which takes into account various
variables.

Soul has divided their sales pattern according to the two seasons i.e. summer and
winter. The first season covers the months of Jan to June and the second covers the
period from July to December. In our meeting with their GM Mr. Imran, the
following insights were reveled about their Merchandizing Plan. The span of
design turn over is very high in shoe industry. The choices of customers change
quickly and the design becomes outdated within few weeks. Generally for fancy
shoe collection the design turn over span is two to three months however, in casual
shoe collection the turn over period is four to six months.
MANAGEMENT

Every business must start with the business planning process. The business
plan is the roadmap of business, where you will define your business, and
outline the steps that can lead you to succeed. This is especially important if
you are planning to seek financing for your store, as banks and investors
would want to see a detailed plan of your business. The management believes
in smart strategic moves, thus they are utilizing the network of Servis mega
stores. It has helped in reducing the distribution cost as well as the rental cost.
Currently there are 15 super market Servis stores where along with other
brands soul collection is displayed as a separate brand. They are focusing on
differentiation strategy because the marketing objective is to become quality
leader.

PLANNING:
FINDING THE RIGHT LOCATION FOR SOUL COLLECTION:

The right location is extremely critical to the success of soul collection. Given the
importance of this decision, they carefully evaluate their choices, making sure that
the location they find can attract a lot of traffic and safely accessible to customers.
Below are factors they have considered while selecting their location:

o Their space requirements (e.g. storage, retail, office space)

o Their store requirements (e.g. lighting, customer restrooms, heating or
cooling, etc.)
o Availability and adequacy of parking (avoid choosing locations that restricts
your store to 2 parking spaces only)
o Population density of the area
o Safety of the area, particularly at night (adequate lighting, police and
security guard protection, etc)
o Ability to attract employees
o If location is remote, amount of advertising needed to attract foot traffic
o Reputation of the landlords
o Performance of other retailers in the area (are stores closing fast in the
area?)
o Presence of complementary retailers that targets same market (e.g. apparel
stores)
o Presence of direct competitors (can you actually compete and are the
dominant store in the area?)
o Merchant or business associations that could help promote their store
o Future developments in the potential store area (any planned zoning
changes, street construction, etc. that could otherwise the traffic that your
store attracts?)
o Cost of the rent (rent can be a fixed amount; fixed amount + percentage of
sales particularly for shopping malls)
o Cost of other dues, if any (e.g. maintenance of common areas, merchant
association fees).

• POSITIONING WITH PLANNING:

• “The soul of Fashion” is the slogan of Soul Collection. They want people
to perceive it as a foreign brand. To some extent it has been achieved. The
feedback of the customer has showed that they have perceived this image to
great extent.
•
• It’s a masses brand. In pricing they are keeping it with the market. The
image is maintained through proper branding in advertising and interior. The
interior team had been given a challenge for making the interior good
looking, should not be so much high-tech so that that image of extremely
high priced product should be avoided.
 •
• The profile for Soul Collection’s customer consists of the following
geographic, demographic, and behavior factors.

1. Geographic:

The initial plan was to capture the most footfall market areas. Though a deep
market analysis the following four outlets were planned in the first phase of
opening.

Super Location: Liberty Market Lahore

Top three locations:

a) Tariq Road Karachi

b) Bank Road Rawalpindi
c) Link Road Lahore

The immediate geographic target is the city of Lahore, Karachi,

Islamabad and Rawalpindi.

First phase of openings of outlets is targeted towards 3 outlets in Lahore, 1 in

Karachi, 2 in Rawalpindi, 1 in Abbotabad, 1 in Peshawar, 1 in Sahiwal and 1 in
Faisalabad.

Focus is to target the shopping areas where shops for ladies accessories and
products are available. The plan involves opening up outlets wherever the
outlets of Stylo and ECS are already operating. Market footfall will be the
focus for every new outlet.

Planning for Product Research:

Soul is continuously conducting product reach through the focus group just to
improve their product quality and sales target. It also helps them to look at what
products can be produced with available technology, and what new product
innovations near-future technology can develop. An other main advantage of
conduction the research is to identify the life cycle of a particular product as
according to them the life cycle of casual shoes is normally from 4 – 6 months and
fancy shoes is of 2 – 3 months.

They are modifying western design with eastern to give a new and modern look;
also have a designers to create seasonal and occasional designs as per market
demand. They choice colors according to the new upcoming seasonal colors and
designs. They usually pick the idea of new forthcoming colors from the textile
industries and from Indian entertainment industry. Soul collection is also
identification research include market potential, market share, brand or
company image, sales analysis, and forecasting.

ORGANIZING:
Organizing resources can mean a variety of things. First, the manager is in charge
of organizing human resources. For example, a manager will need to be sure the
appropriate employees are hired. In addition, it is the manager’s responsibility
to ensure the employees have the skills necessary for the workplace. Organizing
these employees, according to when they are needed and how they are utilized, is a
critical part of the manager’s position.

In a manufacturing business like SOUL COLLECTION, organizing as a

management function also involves ordering parts and other components needed to
produce products. A manager must be extremely organized to keep track of items
needed, without having components too early or too late. Change is inevitable. For
firms that experience change frequently, the organizing function is even more
crucial. Organizational changes such as adding new positions or eliminating
certain processes can change the organizational level and structure of the
business. Soul sells upscale women's shoes. Soul Collection has a wide range of
fancy and casual shoe collection .The product development strategy focuses firstly
on the collection bridal shoe. These are all cottage industry products. Apart from
shoes SC are also offer various type of designed handbags. The focus is to
provide superior quality that gives comfort with aesthetics.

The experienced management decides over the design of the shoe to be able to sell
in considerable amount at the outlet under this brand. Customers associations with
the brand are different with different brand; one type of product may sell easily
less than one brand and does not sell well under the other brand name. The market
trends follow weather change and occasions. The following occasions affect the
overall design, color combinations and materials.

 EID
 SHADI SEASON
 BASANT

Weather Division:

 Summer season trends

 Winter season trends
 Discounts in February and July

ORGANIZING THROUGH HUMAN RESOURCE POLICIES:

• Tracking competitor’s employees

• Train retail staff
• Pay high salaries to retail staff then of the competitors to retain them and to
create a high level of motivation.
• Retail staff should be presentable
• No high education required for backend employees

The successful retail strategy is to be better than your competition in one of the
following three key areas:

d) Price
e) Service
f) Product

At the same time, you must also remain competitive in the other two.

 Like all major retailers in Pakistan, Soul has a merchandising buying

process that allows its buyers to forecast with some degree of accuracy what
to purchase and when to have it delivered. This greatly assists the company
 in attaining its sales and gross margin goals. The foundation of this planning
process is the six month merchandise plan which takes into account various
variables.

 Soul has divided their sales pattern according to the two seasons i.e. summer
and winter. The first season covers the months of Jan to June and the second
covers the period from July to December. In our meeting with their GM Mr.
Salman, the following insights were reveled about their Merchandizing Plan.

LEADING:
Managing and leading are not the same activity. A manager manages employees;
this person makes sure that tasks are completed on time and policies are followed.
Employees typically follow managers because he or she is the supervisor and in-
charge of employees. Employees see a leader as someone that motivates them
and guides them to help meet the firm’s goals. In an ideal situation, the manager
also serves as the leader. Managers who want to lead effectively need to discover
what motivates their employees and inspire them to reach the company objectives.
Managing Marketing Objectives:

• The aim is to become the quality leader

• They want to become smart player and not the largest player
• To become better then style and a little lower then Carly’s
• Increase repeat customers by 7% per quarter.
• To cross the break even point within 3 years

Leading by fulfilling Market Needs:

Soul Collection is providing the market with a wide range of fashionable shoes
with an unprecedented selection.

• The patron will be impressed with the degree of care that they receive.
 • Have to break the stereo type product styles
• Need of western styling in products
• Color variation is a key to success
• products will be priced competitive to others
• central location and wide range of business hours designed to accommodate
all customer's needs

CONTROLLING:
Controlling function involves monitoring the firm’s performance to make sure
goals are being met. Managers need to pay attention to costs versus performance
of the organization. For example, if the company has a goal of increasing sales by
5% over the next two months, the manager may check the progress toward the goal
at the end of month one. An effective manager will share this information with his
or her employees. This builds trust and a feeling of involvement for the employees
Soul collects, analyze, and disseminate information for the purpose of
assisting management in decision making related to the identification and
solution of problems and opportunities in market.

They are concentrating on understanding the consumer behaviors, their

preferences and aims to understand the effects and comparative success of
marketing campaigns. They are also examining all aspects of a business
environment i.e. Competitors, market structure, government regulations,
economic trends, technological advances, and numerous other factors that
make up the business environment.
Gather historic information:

The marketing team gathers historical information and on the basis of it develops a
6 month plan. The objective of it is to prepare a month by month total rupee-
purchasing schedule for Soul. Since Soul is new to the market, their sales team can
only compare the results of 2007 with that of 2008. Even that gives a fairly good
idea about the sales trends and what to anticipate in the future.

Perform qualitative analysis:

GM Soul believes that the buying process is 90% analytical and 10% intuitive.
They gather data about the customer buying patterns and the overall situation of
the market. The recent economic instability has put a halt into their aggressive
buying behavior but nevertheless they still anticipate the market to bounce back.
They perform their analysis by taking into account the following components:

SC achieves their goals through Customer profile analysis:

 Who are soul’s best customers and what are their buying behaviors and

attitudes?

 Who does soul want their customers to be?

 Who are soul’s secondary customers and what should they buy for them?

KEY TO SUCCESS BY CONTROLLING THE ACTIVITIES:

The keys to success are to meet the demand for an upscale women's shoe store
with a wide selection and focused customer attention.

 99% successful product designs are in-house designs

 Supply chain is the core competency
 Inventory turn is double and we are trying to increase it
 Fashionable designs.
 Fast customer delivery. (Within 90 seconds we handover the product)
 Well-trained employees.

FUTURE PLANS OF SOUL COLLLECTION ARE:

• Focus on export
• Outlets in abroad
• Magazine
• Customer loyalty programs
• Franchises
 MARKETING PLAN
INDUSTRY ANALYSIS

Situation Analysis:
Soul Collection has entered into the ladies footwear. Being in the shoe industry they
had no presence in ladies footwear previously and a big market chunk was missing.

Retail Tax:

Before 2006 the government of Pakistan was charging 15% retail tax on ladies
shoes. Soul Collection did not enter into the market before 2006 due to this retail
tax because it was making it 15% expensive from the market. The government
weaved off the retail tax in 2006 and SERVIS group of industries found this situation
workable and finally decided to enter ladies shoe market.

Purchase Tax (With Holding Tax):

Majority of private brands and small industry players don’t pay taxes. The corporate
strategy of Servis Group of industries include paying all the taxes Government
applies 3.5% of the whole purchases as with holding tax.

Soul collections buy on 3.5% higher then the other market in order to maintain the
corporate strategy of their moral duty to pay all the taxes. Other market players
don’t pay this 3.5% tax, which makes them sale, their products less expensive.
However soul collection purchases with tax but they have to maintain their selling
prices in balance with the competitors, which give fewer profit margins.

Industry/Market Summary:

Pakistan’s footwear industry manufactures some 120 million pair annually for local
consumption and it exports 2 million pair per annum roughly and the average price
charged for each pair stands around $10. Its share in Pakistan’s total exports is
about to touch the figure of $200 million.
 Out of all only 25% shoe market is with SERVIS and Bata. Other individual players
hold the rest of the market share of overall shoe industry. Ladies footwear industry
is a 50 billion market where 80% shares lie with the individual players.

SC has captured good information regarding their market and knows a great deal
about the common attributes of the most prized customers. The will leverage this
information to better understand who should be served, their specific needs, and
how they can better communicate with their customers.

World World World

World World
Leading Export Export Export
Export Export
Exporting
Share in Share in
Countries Share in Share in Share in
1980 1999
1985 1990 1995
China 1.6% 1.9% 7.1% 14.6% 20.9%
Italy 29.2% 25.8% 22.7% 17.9% 15.5%
Spain 4.5% 5.7% 5.0% 4.6% 4.7%
Hong Kong 1.4% 1.7% 6.5% 17.2% 13.7%
Taiwan 12.3% 15.6% 8.9% 2.1% 1.2%
Korean 7.6% 10.6% 14.7% 2.9% 1.1%
Republic

STATISTICAL DATA FOR IMPORTS OF SHOE INDUSTRY

YEAR PAIRS

2001 521,117
2002 1,509,422
2003 5,339,976
2004 9,117,068

Target Markets:
Target market is a female of all ages. Females are 51% of the total population of
Pakistan.

Entry/ Exit Barriers:

Entry barriers are high however exit barriers are low. High investments and capital
is required to enter this industry .On the other hand technical knowledge, expertise
and availability of skilled work force makes entry barriers high. National and
international level competitors are competing at the same platform with minor
variations.

Market Demographics:
The profile for Soul Collection’s customer consists of the following geographic,
demographic, and behavior factors.

Geographic:

The initial plan was to capture the most footfall market areas. Though a deep
market analysis the following four outlets were planned in the first phase of
opening.

Super Location:
Liberty Market Lahore

Top three locations:

• Tariq Road Karachi
• Bank Road Rawalpindi

• Link Road Lahore

The immediate geographic target is the city of Lahore, Karachi, Islamabad and
Rawalpindi.

First phase of openings of outlets is targeted towards 3 outlets in Lahore, 1 in

Karachi, 2 in Rawalpindi, 1 in Abbotabad, 1 in Peshawar, 1 in Sahiwal and 1 in
Faisalabad.

Focus is to target the shopping areas where shops for ladies accessories and
products are available. The plan involves opening up outlets wherever the outlets of
Stylo and ECS are already operating. Market footfall will be the focus for every new
outlet.

• Demographics:

• Females (house wives, working professionals, college/school students)

• Age range 13 – 60 years.

• Socio-Economic class, B and B+

• Income should be that they buy 6 to 7 shoe pairs per year

• Behavior Factors:

• Variety seeking customer

• No brand loyalty

• Its fun shopping

• Fashion conscious.

• Tend to eat out at least once a week, typically more.

• Live the motto "fashion over function."

• Are always aware of the different fashion trends.

• Subscribe to, or at least read, several women's magazines that are fashion
orientated.

Market Needs:
Soul Collection is providing the market with a wide range of fashionable shoes with
an unprecedented selection.

• The patron will be impressed with the degree of care that they receive.

• Have to break the stereo type product styles

• Need of western styling in products

• Color variation is a key to success

• All products will be priced competitive to others

• The central location and wide range of business hours designed to

accommodate all customer's needs

Market Trends Forecast:

The market trend for women's fashionable fancy and casual shoes is toward a wider
selection of common design elements. Over the last few years, there has been a
proliferation of several design variations from a base design. A base design is
released and then there are many different spurs that have common elements but
include a few distinctive characteristics.

The market trends follow weather change and occasions. The following occasions
affect the overall design, color combinations and materials.

• EID

• SHADI SEASON

• BASANT

Weather Division:
• Summer season trends

• Winter season trends

• Discounts in February and July

Market trends are also being derived through Indian movies and especially from
star plus dramas. Color pallet is being assessed by the movies.

Trends in the fashion footwear market are evolving and the style mantras of the
past are no longer applicable. There are new fashion icons and trends governing
consumer choices now. Soul Collections makes sure that its customers always get
the cutting-edge fashion footwear that they desire, be it formal shoes with the
finest embellishments. We ensure that Soul Collections a brand that caters to local
needs but also finds a place for itself on the international platform.

The buying habits for fashion-conscious women consist of typically buying at least
one pair of shoes per month. Women generally purchase a pair of shoes to go with
a specific dress. Once the woman purchases the dress she will then begin the long
search for the perfect pair of shoes.

Market Forecast :
It is a 50 billion market and the focus of the CS management is to capture the 10%
of market for its brand.

Market Growth:
The market for women's shoes is a strong, steady growing market. It is generally
not affected by economic downturns. Women seem to consume shoes regardless of
the economic climate. In a popular mini-series, a women's habit of buying shoes
was described as a release when they are feeling bad, a way to make them feel
better, similar to eating chocolate. While this stereotype might not be entirely
accurate, women love their shoes and cannot seem to get enough.

In population its 15% to 20% growth trend and per capita income is increasing
which increases the sales of the product. The market share is to be gained because
private brands capture 80% of the female shoe market, which still has to be taken
by SC.
Marketing Strategy:

Part of SC marketing strategy is based on location and distribution. SC is located in

a trendy malls and busy female product markets that receives abundant walk-
through traffic. This location costs a premium and is not directly linked to the
marketing budget as rent has been categorized under general overhead.

The management believes in smart strategic moves, thus they are utilizing the
network of servis mega stores. It has helped in reducing the distribution cost as well
as the rental cost. Currently there are 15 super market servis stores where along
with other brands soul collection is displayed as a separate brand.

They are focusing on differentiation strategy because the marketing objective is to

become quality leader.

Marketing Objectives:

• The aim is to become the quality leader

• They want to become smart player and not the largest player

• To become better then style and a little lower then Carly’s

• Increase repeat customers by 7% per quarter.

• To cross the break even point within 3 years

Positioning:
“The soul of Fashion” is the slogan of Soul Collection. They want people to perceive
it as a foreign brand. To some extent it has been achieved. The feedback of the
customer has showed that they have perceived this image to great extent.

It’s a masses brand. In pricing they are keeping it with the market. The image is
maintained through proper branding in advertising and interior. The interior team
had been given a challenge for making the interior good looking, should not be so
much high-tech so that that image of extremely high priced product should be
avoided.

Advertising & Promotion:

However this is a masses brand but focused advertising and used to create
awareness. One reason for this is because of being a new entrant and less number
of outlets in selective areas.

Instead of playing a proper 30 or 60 seconds TV commercial over national channels

its preferred to play the add on local cables only to target those areas where they
have opened the outlets.

Avoiding the national TV channels commercials has saved cost. The planning shoes
that showing TV commercial in the cities where there is no stores launched can hurt
the brand image thus the decision for local cable channels is better to save the
image and to communicate effectively.

Secondly Hoardings are placed in three big cities and larger then life image of the
product is projected to communicate customers. The slogan has been established
effectively.

Magazine ads are also printed to capture ladies who read fashion magazine. For
promotion the management takes the following steps

• Loyalty cards are given to customer to develop a closer relationship with them
and to support and encourage buying.

• In-house magazine is in the process.

• Promotional material is given to suppliers and distributors (wall clocks).

• Branding is maintained through the shop interiors.

Marketing Mix:

SC marketing mix is comprised of the following approaches to pricing, distribution,

advertising and promotion, and customer service.

Pricing: SC pricing is designed to be competitive to the other fashion shoe

retailers.

Price Comparison

Category Soul Stylo Ehsan Shu-8

Collection
Chappal 340 375 390 345
Professional 790 775 795 810
Shoe
Bridal 1550 1800 2200 1650
Party Wear 990 900 995 1100

Distribution:

Distribution will be through personal outlets of SC. It will also be available on all of
Servis’s mega stores. One outlet is franchised and latter on further more will be
given on franchise to expand geographically but in the present plan the percentage
for personal outlets and franchise will be 90 to 10%.
Advertising and Promotion: Location, targeted advertising on the localized cable
network, magazines and Hoardings.

Customer Service: Exceeding customer's expectation is the company's mission.

Target is to accommodate customer within 90 seconds. The product faults and
repairs are served for a limited period of time as per company policy.
 •

SWOT ANALYSIS:
The following SWOT analysis captures the key strengths and weaknesses
within the company, and describes the opportunities and threats facing SC.
 STRENGTHS WEAKNESSES

Experience in shoe industry Smaller player, can’t dictate market

Experienced management Slow market penetration

Extremely strong relationships with Late entrant

suppliers.

Strong perception of red color Had to bear high cost of real estate at the
which is associated by people. time of entry

Excellent staff who are well trained

and customer attentive
Opportunities Threats

A growing segment of the market At present law and order situation

that is increasingly

Big gap of market to be captured Low cost private players

The ability to operate on lean

overhead relative to competitors.

Quick change in demand

Critical Issues:

 We cannot associate SC to SERVIS because of the poor perception for

fashion products of SERVIS in the eyes of customer. We are looking forward to
register this brand of high quality and more variety brand.

 Major issue is that local vendors copy the designs. Cannot go for the
copyrights because of the quick turn over of the design. Local vendors who copy
the design sell it on low price, which hurts the brand sales.

 High rental costs are becoming barriers for more outlet developments
 Industry Analysis

By definition, industry analysis is business research that focuses on the potential of

a firm. Basically, an industry analysis is conducted to addresses three important
questions:
 Is the industry accessible—in other words, is it a realistic place for a new
venture to enter?

 Does the industry contain markets that are ripe for innovation or are
underserved?

 Are there positions that will avoid some of the negative attributes of the
industry as a whole? (Barringer & Ireland, 2006)
 Perform qualitative analysis:
 GM Soul believes that the buying process is 90% analytical and 10% intuitive.
They gather data about the customer buying patterns and the overall
situation of the market. The recent economic instability has put a halt into
their aggressive buying behavior but nevertheless they still anticipate the
market to bounce back. They perform their analysis by taking into account
the following components:



 Customer profile analysis:
 Who are soul’s best customers and what are their buying behaviors and
attitudes?
 Who does soul want their customers to be?
 Who are soul’s secondary customers and what should they buy for them?

 Department analysis:
 To effectively forecast the sales and purchase the right product, Soul has
divided their 9 outlets into 3 department’s i.e. bridal shoes, casual shoes and
accessories (bags, socks, pouches etc). This enables an easy to understand
store-by-store analysis.

 Key department trends:
 Soul’s buyers keep a constant track on the trends in the market. They are on
the look out of what is hot in the market and what their competitors are
doing. This enables them to forecast future trends and bring abut a better
 product in the market. They also analyze what department is performing
better in its own competition i.e. Soul’s bridal shoes Vs Shu 8’s bridal range.


Sales Forecasting:

They determine the expected level of sales given the level of demand. With respect
to other factors like Advertising expenditure, sales promotion etc. According to
them each of their outlets has different sale targets according to its location and by
now outlets are achieving the target sales. On the other hand it’s their target that
they will at break even after 3 years.

Location Research:

Soul Collections launched its first outlet on the 30th of April, 2007 in the well-
known Liberty Market--the heart of Lahore, which itself is the heart of Pakistan.
They have 9 outlets but they are very much concern about the good location for
opening their outlets just to improve their target sales.

Suppliers Research:

Soul has about 100 to 150 venders and they usually find out the expert and
experienced venders to work with them so that they supply them the best quality.
They also have a contract with them that they will not sell their designs to their
competitors.

Competitors Research:

They also be aware of each of their competitors moves so that they must make
their strategies accordingly.

Research & Development:

Research and development is nowadays of great importance in business as the

level of competition, production processes and methods are rapidly increasing. It is
of especial importance in the field of Marketing where companies keep an eagle
eye on competitors and customers. In order to keep pace with modern trends and
analyze the needs, demands and desires of their customer’s soul is continuously
working on improving their quality with affordable and elegant designs to become
a good market share in fashion shoe industry. As they want to achieve 10% of total
market share within a period of 5 years. Their designer is an NCA graduate;
always try to come with different and unique designs and styles. They carefully
research that what will be the new colors and designs for the next upcoming
season, for this they pick the themes and colors from Gul Ahmad lawn prints, have
an idea from western designer’s collections and from the Indian entertainment
media.

Initially, soul was 100% depended on their venders designs but now they are
relaying 30% of their venders and 70% of their own design because of tough
competition in footwear market as well as due to the design theft they are now
more focusing on their own designs and styles.

Production Process / Suppliers :

Soul collection have no production process as they are working with different
venders and according to them they have about 100 – 150 venders. They have
different production capacities i.e. some venders can provide 100 pairs of shoe per
week and some are more then that. Actually, Ehsan, Stylo and Soul has almost
same vender base.

Sales Strategies:

Marketing and sales are very different, but have the same goal. Marketing
improves the selling environment and plays a very important role in sales. Soul’s
sales strategies are to drive more profits and business success. Basically, they give
sales target to each and every outlet according to their location and they are very
successful in achieving that target. Their goal is to increase the number of
interactions between potential customers and the sales team using promotional
techniques such as advertising, sales promotions, publicity, creating new sales
channels and new product designs.

They focus on the first week of the month because sales tend to be high within that
comparatively. On the other hand occasions are treated extraordinarily.

SALES PATERRN COMPARISON

Soles collection Stylo Ehsan

Seasonal sales 2 times a year Once a year Once a year
Break Even Plan:

It is planned to achieve the break even within maximum of 3 years time. From the
opening, till now the forecast is steady.

Sales Forecast:

Target is planned to gain 10% of the total market share within 5 years time.

Sales Comparison:

Soul Collection is following the map plan of STYLO, per day, per month and per
years sales of Stylo are the following. This data gives us a situation plan followed
by SC. Different shops are given different sales target in accordance with the
location, footfall and city.

SALES STYLO LIBERTY

OUTLET
Per Day Sales Rs. 136,987
Per Month Sales Rs. 4,166,667
Per Year Sales Rs. 50,000,000

Difficulties & Risks:

 Design theft: Local venders & other copy designs and sell on low prices

 Law & Order problem minimizes the customer flow

 High costs of real estate (outlet rental)

 Entrance of males in the outlets during rush hours is banned

Import & Export:

The following brands import their product from these countries

Soul STYLO EHSAN

Import
Collection
From
Thailand China Thailand

Soul collections have started exporting. The first shipment is already delivered and
the top management is waiting for the response.

Define the merchandize policy:

Soul has a policy in place which gives its buyers some guidelines into the buying
process. It gives them guidance in the following areas:

 Demographics of current and potential customers

 Store’s image

 Merchandise quality levels

 Price point policy

 Marketing approach

 Customer service levels

 Desired profit levels

This policy hence gives them a sense of direction as to what to plan and how to go
about executing it. Soul’s buyers also ensure that what they have planned for a
given season is in line with the trends and that the prices are set according to what
their competitors have set.

They also ensure that they are protecting the local cottage industry which provides
employment to thousands of households. Although they do source some of their
collections from abroad but care is taken to ensure the sustainability of the local
industry. This is in fact is the policy adopted by other competitors namely, Shu 8,
Stylo, Metro, Ehsan etc.

Department analysis:

To effectively forecast the sales and purchase the right product, Soul has divided
their 9 outlets into 3 department’s i.e. bridal shoes, casual shoes and accessories
(bags, socks, pouches etc). This enables an easy to understand store-by-store
analysis.

Key department trends:

Soul’s buyers keep a constant track on the trends in the market. They are on the
look out of what is hot in the market and what their competitors are doing. This
enables them to forecast future trends and bring abut a better product in the
market. They also analyze what department is performing better in its own
competition i.e. Soul’s bridal shoes Vs Shu 8’s bridal range.
Distribution Network:

They make use of the same distribution facilities that are at the disposal of Servis
group. Once the goods are received at the depot from the vendors, they are then
dispatched to each of the 9 outlets according to the assortment plan.

Soul has divided their nine outlets according to the locality they serve and their
annual sales. The liberty outlet being their flagship store receives the maximum
number of lines. The areas like Sahiwal and Faisalabad receive the lines which the
management thinks they will be able to sell.

It is very important that an

organization considers its
environment before
beginning the marketing
process. In fact,
environmental analysis
should be continuous and
feed all aspects of
planning. The
organization's marketing
environment is made up of:
1. The internal
environment e.g. staff (or
internal customers), office
technology, wages and
finance, etc.
2. The micro-environment
e.g. our external customers,
agents and distributors,
suppliers, our competitors,
etc.
3. The macro-environment
e.g. Political (and legal)
forces, Economic forces,
Sociocultural forces, and
Technological forces.
These are known as PEST
factors.
Servis is an incorporated company that designs, develops and markets worldwide
athletic footwear, apparel, equipment and accessories. It employs both traditional
and non-traditional distribution channels in whole country with primary market
regions in the Unit

PEST Analysis

Service, being an international organization, needs to focus on macro

environmental factors. Macro environmental factors comprise Political,
Economics, Society, and Technology,.

Political Analysis
Political Factors.
The political arena has a huge
influence upon the regulation of
businesses, and the spending
power of consumers and other
businesses. You must consider
issues such as:
1.How stable is the political
environment?
2.Will government policy
influence laws that regulate or
tax your business?
3.What is the government's
position on marketing ethics?
4. What is the government's
policy on the economy?
5. Does the government have a
view on culture and religion?
6. Is the government involved
in trading agreements such as
EU, NAFTA, ASEAN, or others
The government must create economic policies that will foster the growth of
businesses. Soul collection, fortunately, has been helped by the policies which
enable it to advance its products. The support accorded to it by the
government, particularly in the general macroeconomic stability, low interest
rates, stable currency conditions and the international competitiveness of the
tax system, form the foundation critical to it’s growth.

Economic Analysis]
Marketers need to consider the
state of a trading economy in
the short and long-terms. This
is especially true when planning
for international marketing. You
need to look at:
1. Interest rates.
2. The level of inflation
Employment level per capita.
3. Long-term prospects for the
economy Gross Domestic
Product (GDP) per capita, and
so on

In economy, the biggest threat for Servis would be economic recession.

During recession, its growth will be adversely affected. The country’s
economy is experiencing a downturn right now. Consumer purchases are
slowing down. Currently, it's feeling the pinch of the economic recession. The
Asian economic crisis also affects Service since its goods are manufactured in
Asia. The labor costs and material prices are going up.
Its growth is not just affected by the local economy but also in the
international economy. A weak Euro and an Asian recession could mean weak
sales for Servis.

Socio-Cultural Forces
The social and cultural
influences on business vary
from country to country. It is
very important that such factors
are considered. Factors include:
1.What is the dominant
religion?
2.What are attitudes to foreign
products and services?
3.Does language impact upon
the diffusion of products onto
markets?
4.How much time do consumers
have for leisure?
5.What are the roles of men
and women within society?
6.How long are the population
living? Are the older
generations wealthy?
7.Do the population have a
strong/weak opinion on green
issues?

People are more health conscious nowadays. Diet and health are getting more
prominence. Consequently, more and more people are joining fitness clubs.
There is an accompanying demand for fitness products particularly exercise
apparel, shoes and equipment. Servis is at the forefront of this surge in
demand as people are looking for sports shoes, apparel and equipment.
Servis, however, failed to foresee problems brought about by a sweatshop
expose pertaining to labor and factory conditions at production locations in
Asia. This caused bad publicity and declining sales as society and consumers
demand more socially responsible companies.

Technological Forces
Technology is vital for
competitive advantage, and is a
major driver of globalization.
Consider the following points:
1. Does technology allow for
products and services to be
made more cheaply and to a
better standard of quality?
2.Do the technologies offer
consumers and businesses
more innovative products and
services such as Internet
banking, new generation mobile
telephones, etc?
3.How is distribution changed
by new technologies e.g. books
via the Internet, flight tickets,
auctions, etc?
4.Does technology offer
companies a new way to
communicate with consumers
e.g. banners, Customer
Relationship Management
(CRM), etc?

Servis uses IT in its marketing information systems very effectively. Nike

applies marketing information systems to the economics of innovation,
segmentation and differentiation for most of its businesses. Servis’s leadership
status owes in large part to the use of extremely valuable Information
Technology and applying it to every aspect of the product from development
to distribution.

Servis, being the world leader in the athletic footwear industry, is able to
effectively harness its environment to boost its marketing efforts. This
strategy has translated into robust sales of it's products.