Danish Fashion Going Global - Spandet And Partners
Danish Fashion Going Global - Spandet And Partners
Danish Fashion Going Global - Spandet And Partners
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DANISH FASHION GOING GLOBAL 52<br />
• international expansion<br />
• further investment in existing business platform to ensure market and product<br />
development<br />
• diversification possibilities (licensing)<br />
• supply chain issues (delivery, quality, purchase power, etc)<br />
• marketing and branding (investments)<br />
• office spared (if shared)<br />
• IT and Business intelligence<br />
• retail competencies<br />
• possibility to supplement wholesale with retailing either as shop in shops or<br />
franchise<br />
Contrary to horizontal integration, which is a consolidation of many firms that handle<br />
the same part of the production process, vertical integration is typified by one firm<br />
engaged in different parts of production (e.g. raw materials manufacturing,<br />
transporting, marketing, and/or retailing).<br />
There are three varieties: backward (upstream) vertical integration, forward<br />
(downstream) vertical integration, and balanced (both upstream and downstream)<br />
vertical integration.<br />
Pandora is an example of balanced (both upstream and downstream) vertical<br />
integration.<br />
Metropol is an example of backward (upstream) integration. Metropol has their own<br />
factory in China but still have multibrand shops (partly) as their distribution.<br />
Forward (downstream) integration is done by many fashion brands opening up their<br />
own shops, partly due to the attractive, additional margins, partly because they<br />
cannot get the right locations, partly due to marketing and branding purposes. Many<br />
of these brands do not have backward integration and rely on factories and<br />
outsourced production in for instance China.<br />
Although the vertical fashion chains have led the change in integration, the fashion<br />
industry is still “old fashioned” compared to for instance the car industry which is fully<br />
integrated both upstream and downstream.<br />
A further change is expected to take place among other caused by the Internet as an<br />
important sales platform. Also the social media will make profit margins and<br />
production processes more transparent. We will likely witness competitive moves<br />
from new players basing their business idea on why a consumer should pay ten
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