1. STRATEGIC MANAGEMENT
CORE 11-130
Group Project
Word Count: 4,773
Turn-It-In Receipt #: 439524110
Due Date: 25/07/2014
Course Tutor: Alanis su
Group Members: Abbey Hindle, Destiny Flaherty, Jared Alen,
Michael Dagg & Tom Jenkins

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1.0 EXECUTIVE SUMMARY
This report will provide an analysis and evaluation of Quiksilver Incorporated (NYSE :
ZQK). Multiple methods were used to analyse the company. These methods included;
o A macro environment analysis (PESTEL – ID)
o An industry analysis (Porter’s 5 Forces)
o An internal analysis (VRIO framework)
The major finding of the analyses indicates that the company needs to address two key
issues, which could negatively affect their profits if they do not address them soon.
Key Issues
o The slow and/or lack of adaptation to trends.
o Rivalry from cheaper online competitors.
Key Recommendations
o Invest in market research to ensure that the trends in society are assessed,
designed accordingly and sold. Moreover, it is recommended to develop new
subsidiary companies that will be able to have a more organic structure, which can
ultimately adapt to trends far more rapidly and effectively while also protecting
the established Quiksilver brand name and image.
o To strengthen our online e-commerce presences to ensure all customers have
access to purchasing and receiving our products.

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2.0
Table
of
Contents
1.0 EXECUTIVE SUMMARY
........................................................................................................................
2
2.0
Table
of
Contents
..................................................................................................................................
3
3.0
QUIKSILVER
CUSTOMER
BACKGROUND
....................................................................................................
5
3.1
Customer
Background
.......................................................................................................................
5
3.2
Company
Background
.......................................................................................................................
5
3.3
Business
Target
Market
.....................................................................................................................
6
3.4
Value
to
the
Customer
......................................................................................................................
7
4.0
Macro-­‐Environmental
ANALYSIS
................................................................................................................
8
4.1
The
Driving
Forces
(DF)
...................................................................................................................
8
4.1.1
Societal
Trends
............................................................................................................................
8
4.1.2
Online
Shopping
.........................................................................................................................
8
4.1.3
Cultural
Differences
....................................................................................................................
9
4.1.4
Disposable
Income
(Demographic)
.............................................................................................
9
5.0
Industry
Analysis
......................................................................................................................................
10
5.1
Threat
of
New
Entrants
...................................................................................................................
10
5.2
Bargaining
Power
of
Suppliers
.........................................................................................................
10
5.3
Bargaining
Power
of
Buyers
.............................................................................................................
11
5.4
Threat
of
Substitutes
.......................................................................................................................
11
5.5
Rivalry
of
Existing
Competitors
........................................................................................................
12
6.0
VRIO
Internal
Analysis
...............................................................................................................................
13
6.1
The
VRIO
Table
................................................................................................................................
13
6.2
Financial
...........................................................................................................................................
13
6.2.1
Mergers
and
Acquisitions
.........................................................................................................
13
6.3
Physical
............................................................................................................................................
14
6.3.1
Textiles
and
Manufacturing
.......................................................................................................
14
6.3.2
Professional
Athletes
.................................................................................................................
14
6.4
Human
.............................................................................................................................................
14
6.4.1
Employee
Benefits
.....................................................................................................................
14
6.4.2
Customer
Satisfaction
...............................................................................................................
15
6.5
Organization
........................................................................................................................................
16

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6.5.1
Quiksilver
Foundation
...............................................................................................................
16
6.5.2
Reputation
.................................................................................................................................
16
7.0
ISSUES
...................................................................................................................................................
17
7.1
Important
Issues
..................................................................................................................................
17
7.2
Two
Most
Crucial
Issues
...................................................................................................................
17
7.2.1
The
Slow
and/or
Lack
of
Adaptation
to
Trends
............................................................................
17
7.2.2
Rivalry
from
Cheaper
Online
Competitors
....................................................................................
17
8.0
IMPLEMENTATION
AND
RECCOMMENDATION
.......................................................................................
18
8.1
Adaption
to
Trends
...........................................................................................................................
18
8.1.1
The
Goals
and
Objectives
to
be
Completed
..............................................................................
18
8.1.2
Measures
of
Success
.................................................................................................................
18
8.1.3
Action
Plan
................................................................................................................................
19
8.1.4
Resources
Required
...................................................................................................................
19
8.1.5
The
Cost
.....................................................................................................................................
19
8.2
Strengthening
our
Online
Presence
.....................................................................................................
20
9.0
Appendix
..............................................................................................................................................
21
9.1
PESTEL
ID
in
depth
...............................................................................................................................
21
9.1.1
Political
..........................................................................................................................................
21
9.1.2
Environmental
...............................................................................................................................
21
9.1.3
Economic
.......................................................................................................................................
21
9.1.4
Legal
..............................................................................................................................................
21
9.1.5
PESTEL
ID
Analysis
Table
...............................................................................................................
21
9.2
Acquisition
Table
..................................................................................................................................
22
9.3
Various
Bargaining
Power
of
Buyers
....................................................................................................
22
10.0
References
.........................................................................................................................................
23

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3.0
QUIKSILVER
CUSTOMER
BACKGROUND
3.1
Customer
Background
Quiksilver Inc. is not just a brand, but a family of brands including primarily Quiksilver itself,
Roxy and DC Skate wear. The company focuses on surf wear and varies from clothing to
sporting products. For this reason we will be focusing on the retail industry and conduct
research and analysis for Quiksilver Inc. to facilitate ways in which to improve their company
and how to make them more competitive in the market.
3.2
Company
Background
Quiksilver has a long and detailed timeline of the brainstorming and innovative ideas to
globalizing and becoming one of the most successful companies in the world. It all started in
1969 and actually initiated in the Rip Curl Factory in Torquay, Australia. In this factory Alan
Green began working on a prototype board short to help surfing. This included many
technologies that were used to design wet suits. The idea was that you wouldn’t have to wear as
much clothing that would weigh you down and cost a lot more to purchase, making the sport of
surfing more accessible. Not wearing wetsuits would make you more flexible and able to move
around, thus experimenting with things such as snaps and Velcro flies.
In 1974 Quicksilver exports their unique board shorts to the Lightning Bolt Shop in Hawaii for
the first time. Later in 1977 they export their board shorts to Japan. Continuing the attempt to
penetrate the market globally Quiksilver exports board shorts to France in 1978. Trying to
broaden their brand awareness they also decided to sponsor their first team riders. This was a
successful marketing strategy as the people interested in the team’s riders would likely be at the
surfing events and are likely to be interested in surfing and do it themselves. They would
therefore be influenced into the product and more compelled to purchase them.
1

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Quiksilver Inc. went public within the United States after having conquered the Australian
market. Quiksilver wanted to create Roxy as a part of their corporation as it targeted only girls
widening their range and target audience, thus more likely to generate profits.1993 is the year
where Roxy introduces their ‘Heart’ logo, a mirror reflection of the original Quiksilver logo.
Roxy introduced the idea that girls could also surf and get involved within the lifestyle
Quiksilver promoted. Later in 1994 Quiksilver releases their Roxy branded board shorts for girl
to further encourage this gender diversity. In 2004 Quicksilver made an all-time record for their
incorporation hitting $1 billion in revenue.
3.3
Business
Target
Market
Quiksilver is a world leader in the producing and promotion of an outdoor sporting lifestyle
and along with their extensive experience in the worldwide surfing culture, they have a
diversified mix of branded apparel, footwear and accessories deisgned for young minded
people as well as adventure seeking individuals with particular interests in the Surf, Skate and
Ski action sports. Products are marketed to suit the needs of this target market and their middle
class disposable income.
Currently, Quiksilver is focusing primarily in The America’s, Asia/Pacific and Europe as their
target countries. The United States, Canada and Mexico make up The Americas and constitute
around 49% of the entire collective revenue, 29% of which is being accrued from the Hawaii
and United States West Coast regions alone. Also 39% of Quiksilver’s revenue is being
sourced mostly from Western Europe, where France accumulated 14% of that revenue.
Indonesia, Australia and New Zealand make up the Asia/Pacific region and are responsible for
the other 12% of revenue. (Online, 2014)

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3.4
Value
to
the
Customer
As the retail industry provides a more or less essential product to the market, societal trends
influence consumer behavior and desires. Furthermore, these trends tend to influence
customers to purchase products that reflect their status or personality. The action sports retail
industry fills a niche within the clothing industry where consumers may be involved in the
action sports world and/or may earn a lower disposable income than that of a customer of
larger designer brands.
The value that Quiksilver has brought to the consumers of this industry is essential. With its
heritage imbedded in surfing, skating and snowboarding, they provide customers whom
participate in such action sports with various clothing, equipment and hardware necessary to
fulfill their passion. For example, Quiksilver board shorts provide surfers with appropriate
clothing which will not only allow them to participate in the sport, but to improve their
enjoyment and performance of that sport. While this may not be consistent with all of the
customers of Quiksilver, they also provide individuals with a lower disposable income the
opportunity to purchase stylish clothing that optimizes both its fashion and function.

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4.0
Macro-­‐Environmental
ANALYSIS
4.1
The
Driving
Forces
(DF)
A macro-environment analysis indicates a large number of driving forces impacting the
industry. The main DF’s are:
o Societal Trends (Society)
o Online Shopping (Technological)
o Cultural Differences (International)
o Disposable Income (Demographic)
4.1.1
Societal
Trends
Since consumers of the retail industry historically view the experience as a social behavior, the
effects of society have a substantial impact on the behavior of the consumers and suppliers.
Consumers have a tendency towards purchasing the latest and most popular styles, thus relying
on trends in society. As a product becomes more popular, the amount of consumers of that
product will increase as the popularity increases. This can be seen as a considerable
opportunity for various businesses to notice trends in the market and society and capitalize on
them. However, it can also become a significant threat to the industry if businesses aren’t
diligent in noticing such trends competitors can effectively steal portions of their customer base
and revenue. Since clothing trends in society pose such a profound opportunity and threat for
the retail industry in can be viewed as a driving force.
4.1.2
Online
Shopping
The driving force for technology, which helps the surf retail industry considerably, is online
shopping. Because of online shopping, retail has become more accessible for people within
rural areas or don't have access to regular shops and people who don't have the time to go
physically shopping. It has also allowed for people to get a variety of clothing, or get the size
they want which had previously sold out in store. It adds convenience but also peace of mind
as some people may be embarrassed at personal items that they may be purchasing. It has
become a popular medium as statistics show that 3 in 4 people internet shop. Between the years
2012-2013 15.4 billion Internet users made a purchase online. This number is ever increasing
therefore having an internet site is a necessity in order to become a leading competitor in the
market. Technological factors within the retail industry have completely altered the way in
which we sell, advertise and purchase products making it easier and more

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convenient/accessible. Lifestyle changes and various consumer demographics may also affect
the industry in a large way. As the characteristics of society change, so does their interest in the
retail industry. It may change from season to season, brand to brand or completely different
styles.
4.1.3
Cultural
Differences
Cultural differences play a major role when it comes to international retail companies. Apart
from the obvious language barriers that could occur, there are also religious and legislative
differences that we must face when doing business with international relations. Some
legislative examples could include the working conditions and pay rates for which workers
are positioned in. These cultural differences are significant and are allowed for within the
Quiksilver Business Strategy, although these cultural differences are now slowing becoming
more transparent. With the rise of technological advancements, people have greater access to
information and networking, forming a newly growing worldwide culture that can more or
less represent what we know as a ‘Western Society’. To ensure companies have a smooth
transition into international business, thorough research of each market is essential. Poor
handling and/or exploiting these differences could impact negatively on the company’s
worldwide reputation (e.g. sweat shop/child labour).
4.1.4
Disposable
Income
(Demographic)
The sportswear retail industry is significantly reliant on its surrounding environments, with
particular interests on the demographics of the area and the decision of outlet store
development is based upon this motive alone. Considerate Changes in this demography can
have a large impact on the success of this decision. Recent worldwide events have evidently
done just that, and the change in individual and more specifically a societies disposable
income has occurred with ripple effects still happening in other parts of the world. This
income is greatly determined by changes in employment, salary and taxes. A reduction in an
individual’s disposable income will effectively limit their expenditure on products which
aren’t deemed necessary, such as clothing. Conversely, when the disposable income of
individuals increases it will generally tend to increase expenditure on non-essential products
such as semi-luxury clothing. Since these various societal factors have a large positive and
negative effect on the industry and can be seen as driving forces.

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5.0
Industry
Analysis
The general attractiveness/combined strength of the surf wear retail industry can be
determined using this method.
5.1
Threat
of
New
Entrants
The threat of new entrants to Surf wear retail industry in the current economy is very low as the
surf wear industry as a whole is performing at relatively low profit margins compared to the
preceding yearly sales’. The demise of top competitor Billabong has also shown the volatility
of the surf wear industry to potential new entrants as well as current smaller competitors
considering expansion. This also is strengthening Quicksilver’s brand name within loyal surf
wear consumers as a standalone top quality product. Quicksilver also has established many
distribution channels with other large name retail stores as well as through their own stores
which has implanted the Quicksilver brand across many surfing lifestyle locations. This high
market capitalisation that the Quicksilver brand name has secured, positively safeguards the
organisation from any threat of new entrants of scale. Therefore, the threat of new entrants
entering the market is low.
5.2
Bargaining
Power
of
Suppliers
The strength of bargaining power of supplies in the surf retail industry depends on many

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aspects. In the retail industry, the bargaining power of supplies is relatively low. This means
that the product being supplied is readily available from many suppliers at the going market
price. There is a high competition among suppliers, so their ability to raise prices is
inadequate. Larger retailers have power over the suppliers because they can threaten to switch
suppliers easily. An example of this is would be if a well-known surf retail company (like
Quiksilver) was dissatisfied with the quality or pricing of their supplies, they could easily find
a new supplier with a better price and quality. Also, large retailers are able to vertically
integrate with suppliers if their needs from the current supplier are not met (Study Mode,
2013). Therefore, the bargaining power of suppliers is low.
5.3
Bargaining
Power
of
Buyers
In this particular industry consumers won’t have much bargaining power, since the retail
clothing industry is relatively rigid in terms of price negotiation. This can be partially due to
Australia and various other countries setting a Recommended Retail Price ($RRP), and that the
number of buyers greatly outnumber the amount of sellers, hence, the sellers will have price
control. Additionally, in terms of bargaining power, the individual buyers will have more
ability to switch to competitive or alternative products or services rather than to negotiate on
price with the suppliers. Furthermore, since the retail industry generally capitalizes on trends
throughout society collectively, as discussed previously, products between various brands will
tend to not be substantially differentiated. This increases the ability of the buyers to switch
suppliers with ease, thus increasing their bargaining power. Moreover, since the purchase of
clothing throughout society doesn’t usually represent a significant fraction of an individual’s
total expenditure, buyers are generally not overly motivated or required to purchase products
regularly. Since buyers can also refrain from purchasing these goods for extended periods of
time, as they aren’t essential, they can purchase how they deem necessary, not as society does.
Therefore, the bargaining power of buyers is moderate.
5.4
Threat
of
Substitutes
The availability of the product in the industry will determine to how successful our company
will become. If they can purchase other substitute products then the demand for ours will be
lower therefore we’ll have to adjust our strategies in order to become more competitive and
superior in the market. Threat of substitution affects the competitive environment as it affects
the industries profitability because consumers can choose to purchase substitutes. In contrast
lack of competition mean there’s a less industry competition and increases profit for your

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company in that particular industry. Therefore the power of substitutes in this industry is
moderate.
5.5
Rivalry
of
Existing
Competitors
The Competition between the major Surf wear companies has been moderately low in the past
as Quiksilver has a dominant stronghold of the market. However, due to new entrants and
existing brands diversifying, it is quickly becoming more apparent that the sports wear industry
is becoming volatile and companies such as Nike Inc. and Adidas Inc. are heavily involved in
both sport and street wear. They are also gradually gaining more market share within the
Active Sportswear Industry. Subsequently, It is fair to say the increase in the variety of outdoor
sports is respectively increasing the intensity of industry rivalry. Therefore, by looking at the
contributing elements to competition in the industry, the rivalry of existing competitors is
moderate to high and increasing.

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6.0
VRIO
Internal
Analysis
6.1
The
VRIO
Table
Resources/Capabilities Resource & Capability V R I O
Category Specifics
Financial
Physical
Human
Organization
1. Loss of Revenue No No No No
2. Mergers and
Acquisitions Yes No Yes Yes
1. Textiles and Yes No Yes No
Manufacturing
2. Professional Yes Yes Yes Yes
Athletes
1. Managerial Yes Yes Yes Yes
experience
2. Employee Satisfaction Yes No No Yes
and Benefits
1. Quiksilver Yes Yes Yes Yes
Foundation
2. Reputation Yes Yes Yes Yes
6.2
Financial
6.2.1
Mergers
and
Acquisitions
Quiksilver’s successful history could be accredited to its numerous mergers and acquisitions.
Since 1991, Quiksilver has acquired an extensive number of companies to improve their market
share through diversification, vertical and horizontal integration. These companies include;
competitors in a variety of industries and demographics, complements and substitutes to
Quiksilver’s existing products and companies both forward and backward in their supply chain
to minimize cost and optimize efficiency, (For a full list of these acquisitions please refer to
appendix). Their resource of acquiring these companies to improve market share, minimize
expenses and ultimately optimize their operations have proven a key to the companies’ success.
Analysing this resource it can be seen that it is valuable, costly to imitate and the company is
organised to capitalise on its functions, however, it is not rare.

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6.3
Physical
6.3.1
Textiles
and
Manufacturing
The Quiksilver brand has a strong focus on protecting the world’s natural resources. The
manufacturing industry is a major contributor to pollution and deforestation throughout the
world. Quiksilver have recognised this and are committed to producing a more sustainable
product. Through the altering of their supply chain, sourcing environmentally viable materials,
the company is gaining a competitive “green” advantage. In enacting “green’ initiatives
Quiksilver is enhancing its ‘Corporate Social Responsibility’ (CSR) image.
In terms of the manufacturing of quicksilver and it’s affiliated brands, have developed the
QUEST program and the Supplier Workplace Code. The main purpose of the program and code
is to ensure all workers are treated under the International Labour Law Organisations
conventions. To ensure that the programs maintain their independence the company has
contracted third party monitoring firms. These firms play a vital role in keeping the programs up
to date and efficient. If a supplier was found to be in breach of the code, Quiksilver can terminate
the contract and/or relationship. There is a significant cost in implementing these types of
programs, however it has been shown in sales figures that customers are more inclined to
purchase goods/services a socially responsible company.
6.3.2
Professional
Athletes
Quiksilver gains a more physical presence in the retail market by sponsoring Professional
Athletes. Over the last decade Quiksilver and their affiliates have been aligned with the biggest
names in surfing, skateboarding, surfing and snow sports. Kelly Slater, arguably the King of
modern surfing was aligned with the brand for 23 years. Throughout this time Quiksilver
released a number of “Kelly” branded products with enormous economic and social benefits.
6.4
Human
6.4.1
Employee
Benefits
By far the most critical resource to an organisation’s success is their staff. Quiksilver realises this
and ensures all staff are the right people, with the right skillset for the right job. Once recruited,
Quiksilver manage their staff’s well being by providing professional and leadership
development, study assistance, work/life quality programs, subsidised gym membership,
childcare rebates, discounted health insurance, paid maternity leave, employee share purchase

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program, salary sacrificing and financial planning advice. These initiative see employees being
retained where they will receive service awards for staying period of 10, 15, 20 and 25 years.
These employee benefits saw them ranked in the top 50 places to work in 2013 (BRW, 2013).
6.4.2
Customer
Satisfaction
Due to Quiksilver’s sustained growth and presence in the surf and street wear industries it is
obvious that customers are satisfied with the products. This level of satisfaction is clearly evident
as customers continue to return to Quiksilver. This deduction is evident due to their dominant
level of market share in the industry.

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6.5
Organization
6.5.1
Quiksilver
Foundation
Quiksilver gives back to the community with charitable acts both locally and globally.
Quiksilver realizes that corporate social responsibility is important for how the company is
perceived by the consumer. Thus, they started the Quiksilver Foundation in October of 2004.
Because of the size and popularity of the company it is able to generate a large source for
donation money. It is a non-profit organization that aims to enhance the standard of living to
board riders all over the world. They do this by supporting educational, environmental, health,
and youth- related projects. By promoting and inspiring their customers Quiksilver has
developed a valuable, rare and costly organization that their competitors are unable to imitate.
6.5.2
Reputation
Quiksilver’s reputation is an important factor to the company’s overall prosperity. The company
promotes popular athletes such as well-known surfers Craig Anderson, Dane Reynolds, and
Jeremy Flores. By sponsoring these inspiring individuals, Quiksilver can strengthen their brand
name. Their reputation differentiates them from their competitors and is valuable to their
success. Their unique reputation makes it impossible for competitors to copy, thus making them
stand out to the consumer.

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7.0
ISSUES
7.1
Important
Issues
After conducting the various analyses, it has become apparent that the most important issues
that impact quiksilver are:
o The economic impact from the rise in alternative products (Economic)
o The slow and/or lack of adaptation to trends (Socio-cultural)
o Rivalry from cheaper online competitors (Technological)
o Slow culture changes, affecting consumer behavior (International)
o Significant fluctuations of individual income due to worldwide economic
uncertainty (Demographic)
7.2
Two
Most
Crucial
Issues
The most urgent issues are:
o The slow and/or lack of adaptation to trends (PESTEL ID, Societal Trend).
o Rivalry from cheaper online competitors (PESTEL ID, Technological Trend).
7.2.1
The
Slow
and/or
Lack
of
Adaptation
to
Trends
As mentioned previously, consumers have a tendency towards purchasing the latest and most
popular styles as dictated by societal trends. The slow and/or lack of change and adaptation to
these trends can be potentially due to Quiksilver being such a large organisation with a very
well established reputation it can be quite difficult to change their established and successful
brand image to adapt to these trends.
7.2.2
Rivalry
from
Cheaper
Online
Competitors
Having technologies in place which enable Internet shopping accomplish several things for the
economy through price, demand and availability. Quicksilver currently have their products
circulating the market through department online stores such as Surfstitch. These products don’t

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have as much stock levels, sizes or variety in colours. Whereas, Quiksilver is able to offer these
variations in their physical storefronts. We recommend that Quicksilver implements and
strengths their online store which is attached to their main website as well as creating an App in
the Apple App Store. This would improve the user interface and customers could effectively
purchase product a lot easier and smoother. This improvement would also effectively appeal
and improve the customer base of 14-20 year olds as this is a refereed and popular medium for
shopping. It also opens the range of customer base geographically.
The three main factors which will make Quicksilver a more dominant competitor in the market.
These include Price, Convenience of the shopping experience and the range of product
available.
8.0
IMPLEMENTATION
AND
RECCOMMENDATION
8.1
Adaption
to
Trends
8.1.1
The
Goals
and
Objectives
to
be
Completed
In order to improve their current market share, align with their original target market and to
sustain a competitive advantage, it is essential for Quiksilver to be able to adapt to these trends
in a way which won’t affect their established brand image. This recommendation is to therefore
retain the appeal and loyalty of traditional surfers which their original target market included.
The goal of this recommendation is to therefore attract these lost customers by implementing a
range of products and sub-brands which will follow, improve and create certain trends which
traditional surfers will become a part of. Moreover, by targeting this specific but widespread
market, it is predicted that overall sales will increase from 10-15% within two years, that sub-
brands will double the revenue made in the second year compare to the initial year of
implementation and finally that these sub-brands will adapt to trends far more responsively than
Quiksilver would as a whole.
8.1.2
Measures
of
Success
The progress towards achieving these objectives will be regularly assessed and the strategies
will be modified accordingly. Daily, weekly, monthly and quarterly targets will be enforced in
order to regularly assess the achievability of the goals which were outlined previously. Since
these overall objectives are specific and measurable, the measures of success will obviously be
the revenue and efficiency targets in the relative time-frame.

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8.1.3
Action
Plan
How these goals will be achieved is through extending a grassroots approach to the surf wear
industry. A similar concept, Thalia Surf Store, has seen a recent annual sales increase of 30%
(at the same time that the industry was making a loss) as they refuse to stock the larger labels
(Quiksilver, Billabong and Rip Curl). Surfers are beginning to refuse to wear that product as
they believe it has become too mainstream as those major companies are appealing to the
masses and ultimately losing touch and not adapting to trends (Pawle, 2013). It is therefore
essential to implement grassroots sub-companies to be able to adapt to trends more rapidly
without compromising an established Quiksilver brand image. Since these brands will be of a
much smaller size and production scale, it is possible to incorporate a more organic structure
and therefore adapt to trends far more rapidly than Quiksilver could as a whole.
It is recommended that an extensive market research and design process is undertaken and
maintained to ensure that the trends are assessed, predicted and stocked within these stores.
Since Quiksilver has also purchased and managed designing, manufacturing and distribution
companies these operations can be completed internally to minimize production costs and
improve the time taken from design to market. It is further recommended that these products are
sold both online and in small boutique style stores that operate where a large quantity of trend-
orientated individuals may shop, such as (but not limited to) Byron Bay, Bondi Beach and
Surfers Paradise. These selling methods ensure that the products are as visible and accessible as
possible.
8.1.4
Resources
Required
The resources that are required are firstly a local market research and designing team employed
specifically to detect trends and design accordingly. Small boutique style storefronts with staff
who has goals and personalities that align with the ventures’ and a reliable, impressive and
functional online store. Thankfully these products can be manufactured and distributed by
relative companies that Quiksilver manages, so these production and logistical resources are
already acquired.
8.1.5
The
Cost
The projected costs of the initial research and designing phase of the venture are estimated at
$12,800 worth of labour as equipment and facilities are already owned. In order to stock the
bricks and mortar and online stores is estimated at approximately $750,000. The time invested
in the design and installment of these ventures by the management staff is predicted at a

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minimum of six weeks. The storefronts at the suggested locations themselves can be treated as
on-going operational costs rather than initial capital costs. However, these costs pose little risk
in relation to the return on investment. The ability for Quiksilver to maintain it’s current brand
image and presence while also developing sub-brands to adapt to trends more rapidly and
daringly is projected to increase their growth, presence and lifestyle exponentially.
8.2
Strengthening
our
Online
Presence
By becoming more cost effective on our online store, customers can effectively get an increase
in their consumer surplus. This can be achieved from having several options of where to
purchase Quiksilver product so that the consumers can compare prices.
The convenience of the shopping experience is that consumers cite convenience as a primary
factor to shifting to online shopping. This is that you can access the sites and apps 24/7 and
have no restrictions. It also allows you to compare your products and see the products at all
angles feeling no pressure from other people looking at that item in store or that the store may
be closing forcing you to make a impulse purchasing. It is also more convenient to have your
packages being delivered to your door, again adding convenience to your lifestyle.
The final factor is that there would then be more products available to customers and avoid the
situation of the store running out of your size and having to go to another to get the piece of
clothing. This would of course mean there would have to be a warehouse director who can
monitor how many items are left in stock, but having all the items in one location will
determine whether the company will need to have more items manufactured if they have a high
demand. This can increase sales and maximise profits as there would then be minimal waste.
The way which we believe having more technologies and retail mediums will help Quicksilver
depends purely on the figures we have found in our research. These include Forty-two percent
of customers buy online after viewing their product in the store. They do this due to variety, as
previously discussed, as they provide more variety in colours and sizes as well as prices being
lower due to the overhead costs being eliminated. We then believe that we should create a
Quicksilver shopping app which has as even if we were to implement an online store, figure
suggest that this would be more successful as app shopping users are 46 percent less likely to
compare prices on other online stores which makes it less likely to lose that customer. Having
an online store would also help with our marketing strategy as 2 out of 10 online shoppers will
post about their purchase via social media sites. This would then allow the company to be

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known throughout the world and offer free marketing.
9.0
Appendix
9.1
PESTEL
ID
in
depth
9.1.1
Political
Businesses have an obligation to meet various standards and laws set by the government, the most
prevalent of which is taxation. Companies are required to pay various taxes on their revenue, imports
and other operations. The retail industry has also faced various challenges due to action taken against
child labour, fair trade and unfair workers’ rights. These changes increase the industry’s operating costs
and may affect how the individual business in the industry functions.
9.1.2
Environmental
The environment is becoming is a leading concern for many individuals throughout society as it
jeopardises their future. It is for this reason people have started becoming more sustainable and eco-
friendly. This includes reusing unsold items for their material and remake a different product. There are
also environmental protection forces in place. This has been executed through legislations and pollution
policies. For example the carbon tax. This is a certain amount of money which must be paid to the
government, which will be reinvested in environmental efforts. The way it works is every certain amount
of fossil fuels you produce in your company you must pay a certain amount of money as compensation.
This will affect the amount of profits the company are meant to generate but it places a better focus on
the environment so it can survive in the future.
9.1.3
Economic
Economic factors play a major role in all industries. For the retail industry the most prevalent economic
factor would have to be consumer confidence. Without the consumer being confident in their ability to
purchase items there is, essentially, no retail industry. Another two major economic factors are the effect
that exchange rates play on imports and exports and also interest rates.
9.1.4
Legal
In industry legal factors are an important part of day to day business. Due to the large number of
employees in retail, the main legal factors are concerned with protection of workers. Some of these laws
are to do with child labor, workers rights and also the Australian Competition and Consumer
Commission (ACCC).
9.1.5
PESTEL
ID
Analysis
Table
Core
Trend
P E S T E L I D
1 Taxation
Interest
rates
Trends
Online
Shopping
Enviromental
Protection
Child
Labor
Imports/
exports
Age
2
Minimum
wages
Exchange
rates
Population
Growth
Rate
Energy use
recyclying/
sustainablity
Unions
Culteral
Differences
Location
3
Fair
trade
laws
consumer
confidence
Attitudes
Progessive
Technolgy
carbon tax ACCC
Global
Economy
Income

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9.2
Acquisition
Table
Company Name Function
Na Pali (1991) International Affiliate
The Raisin Company (1994) Swimwear Manufacturer
Mervin Manufacturing (1997) Surf, Skate & Snowboard
Lib Technologies (1997) Surf, Skate & Snowboard
Gnu (1997) Surf, Skate & Snowboard
Bent Metal (1997) Surf, Skate & Snowboard
Fidra (2000) Men’s Golf Apparel
Freestyle (2000) International Snow Gear and Apparel
Gotcha (2000) Youth wear label
Hawk (2000) Apparel and accessories
Quiksilver International (2000) Progenitor
U G Manufacturing (2002) Apparel manufacturing
Quiksilver Japan (2002) Progenitor
Beach Street (2002) Outlet Stores
DC (2004) Footwear and Apparel
Centre Skateboard Distribution (2005) Distribution
Kohl (2005) Sourcing, Distributing, Marketing et al.
9.3
Various
Bargaining
Power
of
Buyers
The bargaining power of buyers in the surfwear retail industry is relatively high. Although, the degree of
bargaining power varies depending on whether the product is being sold as a Business-to-Business
(B2B) or Business-to-Consumer (B2C) transaction. B2B transactions will incur a substantially larger
bargaining power, as they will be purchasing significantly larger quantities than B2C transactions. The
type of bargaining power of B2B transactions will include price negotiation, ease of switching to
substitutes and larger amount of alternatives.

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10.0
References
Colbert, C. (2014). Quiksilver Company Report. [online] Hoovers Company Reports. Available at:
http://cobrands.hoovers.com/company/Quiksilver_Inc/rchtji-1-1njhxk.html [Accessed 2 Jul. 2014].
Coursework4you.co.uk, (2014). What is Porter's 5 Forces analysis?. [online] Available at:
http://www.coursework4you.co.uk/essays-and-dissertations/porter-5-forces.php [Accessed 24 Jul.
2014].
Inc, Q. (2014). California Transparency in Supply Chains Act. [online] Quiksilverinc.com. Available at:
http://www.quiksilverinc.com/About-Us/QUEST-California-Transparency-in-Supply-Chains-Act-
SB-657 [Accessed 24 Jul. 2014].
Karnas, S. (2005). Quiksilver Inc. Analysis.
Magner, L. (2014). Clothing Retail in Australia. IBISWorld Industry Report.
Market Line, (2013). Apparel Retail in Australia. Market Line Industry Profile. London: MarketLine.
Mbaskool.com, (2008). Quiksilver - SWOT Analysis. [online] Available at:
http://www.mbaskool.com/brandguide/lifestyle-and-retail/4029-quiksilver.html [Accessed 7 Jul.
2014].
Pawle, F. (2012). From riches to rags: surfwear industry back to its hard-core roots. The Australian.
[online] Available at: http://From riches to rags: surfwear industry back to its hard-core roots
[Accessed 18 Jul. 2014].
Quiksilver.com.au, (n.d.). QUIKSILVER™ About Us. [online] Available at:
http://www.quiksilver.com.au/about-us [Accessed 3 Jul. 2014].
Slideshare.net, (2014). Michael Porter's model in Retail sector.. [online] Available at:
http://www.slideshare.net/shreedharbhat9/michael-porters-model-in-retail-sector [Accessed 24 Jul.
2014].
Systems, e. (2014). Forests & Fabric Choices. [online] The-quiksilver-initiative.com. Available at:
http://the-quiksilver-initiative.com/Commitment/Americas/Forests-Fabric-Choices [Accessed 4 Jul.
2014].
The-quiksilver-initiative.com, (2014). Quiksilver Initiatives. [online] Available at: http://the-quiksilver-
initiative.com/Foundation [Accessed 24 Jul. 2014].
Top 50 Places to Work. (2014). Business Review Weekly. [online] Available at:
http://www.brw.com.au/p/lists/best-places-to-work/2013/quiksilver_Iust5UWWao5lf671BWaWBJ
[Accessed 24 Jul. 2014]

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