It is about the Fundamental analysis such as SWOT, Porters five force, BCG matrix, CPM matrix, Grand strategy matrix, QSPM matrix, IE matrix, Ratio analysis of Pantaloons
2. About
• Fashion and retail – one of the top clothing
brand in the world
• India’s fastest growing company
• Previously controlled by Future group and
now it is a division of Aditya Birla
3. Our Vision
To be a premium global conglomerate, with a
clear focus on each of the businesses.
Our Mission
To deliver superior value to our customers,
shareholders, employees and society at large.
5. ATTRACTIVENESS Remarks
Low High
1 2 3 4 5
No. of competitors Large Small Shoppers Stop, Trent, Westside and Lifestyle,
Globus,And central.
https://www.scribd.com/doc/47946357/Pantalo
ons
Industry growth slow Fast Indian retail industry is one of the fast growing
industry many new players are entering the
market. India is the fifth largest destination for
retail market. This industry accounts for around
10%of country GDP and around 8% of
employment in India. Indian retail market is
expected to increase by two fold from US$600
billion to US$ 1 trillion by the end of year 2015
driven by attitude shits, urbanization and income
growth.
Ref:Symbiosis Centre for Information Technology
“A constituent of Symbiosis International
University” ITstrategy_project_-_Pantaloons
Fixedcost High Low Ref: Annual report,2015(Pantaloons), Annual
report,2015(shoppers stop)
Differentiaion Low High Source: www.pantaloons.com The brand they’re
selling is Peter england, Allen solly, Louis Phillipe,
Which is also available in many of the rivalries.
6. Switching cost Low High
Openness in
terms of sale
Secret Open
Excess capacity large small Ref:
http://www.investopedia.com/features/industryh
andbook/retail.asp
Strategic stakes High low Organized companies in this sector are mostly
conglomerate.eg. shoppers stop by K Raheja Corp
Group, lifestyle by landmark group,
Westside(Trent) by Tata.
8. ATTRACTIVENESS Remarks
Low High
1 2 3 4 5
Asset
specialization
High Small
Cost of exit High Small If they suddenly decide to close the stores,
the loss will be intermediate, because all the
stores are owned by them which is not a
franchise.
Government
restrictions
High Small Ref: A Research Report On
Assessment Of Competition In Apparel Retail
Industry In India, Competition commission of
India,2015
10. ATTRACTIVENESS Remarks
Low High
1 2 3 4 5
Economies of scale Small Large Very well placed in terms of eliminating all
the excess costs that are there in system and
becoming very competitive. Source:
http://www.marketwatch.com/story/indias-
pantaloon-retail-taps-economies-of-scale-
2011-07-24
Product
differentiation
Low High The group offers a variety of options in
fashion with several famous brands. Source:
http://www.marketing91.com/marketing-mix-
pantaloons/#
http://www.iitk.ac.in/ime/MBA_IITK/avantg
arde/?p=218
Brand Identity Low High The new corporate brand identity is being
worked out taking into consideration the
existing and soon to be introduced businesses
Source:
http://articles.economictimes.indiatimes.com/
2006-02-15/news/27433461_1_corporate-
identity-corporate-brand-pantaloon
Switching Cost Low High Low Switching cost gives customers high
bargaining power.
Source: wikiwealth.com
11. Access to channel of
distribution
Easy Limited Pantaloons has decided to open Distribution
Collection Center (DCC) in 4 major cities in the
country Source:
http://pantaloons.com/pdf/investors/announcem
ent/PFRL-Investor-Presentation.pdf
Capital Requirement Small Large The estimated need for fresh capital is Rs.12bn for
core business rs.3 bn for subsidiaries over next 2
years. Source:
http://www.vccircle.com/news/general/2009/10/
08/pantaloon-it-attractive-investment
Access to technology Easy Restricted They are among the very few retailers who make
serious and optimum use of barcodes and ERP’s
Source:
http://www.iitk.ac.in/ime/MBA_IITK/avantgarde/?
p=218
Access to raw material Easy Restricted 70% of their business is done y selling their own
products and remaining 30 % include complete
inventories of non-apparels & some apparels
brands like UMM,Rang Munch. Source:
http://www.bseindia.com/downloads/ipo/201371
5173232IM_Pantloon%20_15%20July%202013_FI
NAL.pdf
Government
protection
None Substantial the Federal Government of India allowed 51% FDI
in multi-brand retail in India Source:
http://in.reuters.com/article/india-retail-fdi-
13. Attractiveness
Remarks
Low High
1 2 3 4 5
Availability of close
substitutes High Low
It ranges from moderate to
low. Substitute like
bigbazzar, lifestyle, max,
etc.
Source:www.ukeassays.co
m
Switching cost Low High
Switching cost is low
depending in the type of
product
Source:
www.news.morningstar.co
m
Substitutes price-value Better Worse
There is no such price
difference for substitutes
Source:
www.ukeassays.com
Profitability of the
producers of substitutes High Low
This is low since the
substitutes manufacturing
cost also equal and
produce the similar
products.
15. ATTRACTIVENESS
REMARKS
LOW HIGH
1 2 3 4 5
NUMBER OF
BUYERS Small large
The consumers are price sensitive, and have info about the
product and its price. Number of buyers for pantaloons is
in a mediocre stage. The top performer in this industry is
Future Retail with Rs.10341.66crs, Where as Pantaloons
stands with Rs.1850.73crs and few players stands at
Rs.3000crs like Future life, Shoppers stop.
moneycontrol.com-peer comparison(Net Sales)
AVAILABILITY OF
SUBSTITUTES Many Few
There are lot of Substitutes available in the industry. The
availability of substitute products hurts pantaloon to raise
prices because switching cost is too low.
wikiwealth.com
SWITCHING COST Low High
Low Switching cost gives customers high bargaining power.
wikiwealth.com
BUYERS THREAT
OF BACKWARD
INTEGRATION High Low
All the leading brands such as Louis phillipe, Vanheusen,
Allen solly, Peter England etc, owned by Madura fashion
which itself owned by Aditya Birla so buyers threat is low.
adityabirlanuvo.com
16. INDUSTY
THREATOF
FORWARD
INTEGRATION Low High
Allen Solly alone have 235exclusive stores across the country
and have touch Rs.1000crs in FY15. Soon the leading brands
may open their retail outlets in the near future.
wap.business-standard.com
CONRTIBUTION
TO THE QUALITY Low High
Lakshya, a quality assurance initiative by pantaloons to
deliver superior product value to consumers. So it strives to
deliver quality products and superior retail experiences.
abfrl.com
CONTRIBUTION
TO THE COST High Low
It is heavily depend on real estate. Availability of quality
retail space at marquee locations are at higher rentals, so it
directly affects the cost. Still the promotions and discounts
are higher than the competitors.
Annual Report 2015 & livemint.com
BUYERS
PROFITABILITY Low High
The price of the product in the online stores would pose a
threat to the physical stores and the profitability of the
buyers is at midlevel as they may prefer online because of
the cost factors. Pantaloons owns a official online
store(trendin.com)
wap.business-standard.com
18. ATTRACTIVENESS
REMARKS
LOW HIGH
1 2 3 4 5
NUMBER OF SUPPLIERS Small large
Totally there are 30000 suppliers to pantaloons from
small shops to multinational company.eg:Bare
denim,urbana,scullers etc.
Eg:academia.edu/16398724/ITstrategy_project_-
_Pantaloons.
AVAILABILITY OF
SUBSTITUTES Few Many
There are lot of substitutes for pantaloons as there
are more than 30000 suppliers.
SWITCHING COST High Low
Switching cost for the pantaloons is less as they are
supplying direct selling finished products.switching
cost for the change in suppliers for raw material is
also very low because the material supplied is
generic.
Source:Eg:academia.edu/16398724/ITstrategy_proje
ct_-_Pantaloons.
19. SUPPLIERS THREAT OF
FORWARD
INTEGRATION High Low
As of now its not a serious threat but in future it may
pose a threat to all retail stores because premium
brands like Allen solly had started its showrooms
across the india.
CONTRIBUTION TO THE
QUALITY High Low
Pantaloons has been awarded as the India’s most
trusted retail brand in 2014.Without quality the
consumers wont prefer this retail brand as there are
more competitors for pantaloons in their segment.
Source:Their official site.
CONTRIBUTION TO THE
COST High Low
Pantaloons supply chain is said to be one of the most
cost effective in the world. They have cut the 5 level
supply chain into 2.So pantaloons is one company
that has promised value and quality at lower price.
Source:iims-
markathon.blogspot.in/2009/09/pantaloons-retail-
india-ltd-strategy-in.
INDUSTRY’S
IMPORTANCE TO
SUPPLIERS
21. Attractiveness
Remarks
Low High
1 2 3 4 5
INDUSTRY
PROTECTION Low High
Strong in indian retail industry it holds 28% in
organized retail source:www.adityabirlanuvo.com
INDUSTRY
REGULATION High Low
Regulations differ from state to state. It is not
centralize throughout India, depends on the rulling
government Source:www.economywatch.com
CUSTOMS &
TARIFF High Low Source:
23. Strength
1. It is India’s largest retailer having 1,000 stores across 70 cities in
India(Popular brand with a high presence across India)
2. It is country’s largest retailer by market capitalization (10,802.24Crore).
3. The net sales is increased upto 11.1%
4. High powerful supply chain management through SAP.
5. The asset turnover ratio is 1.17:1. This means that for every one rupee in
assets, they generates 1.17 rupees. In other words, pantaloons is very efficient
with its use of assets.
6. The inventory turnover ratio is 4.33. This means the inventory will be in
hand for 83 days which is good when compared to the rivalries (Future –
2.92(124 days)).
24. Weaknesses
1. The current ratio is 0.6:1. That is for every 1 rupee of current liability, the
company has Rs. 60 paise as a current asset to meet its expenses.
2. There are not functioning internationally. But the competitors’ are
internationally functioning.
3. The return on capital employed is in negative (-6.82%). This means the
efficiency and profitability of the capital investment is very bad
4. Their net loss increased to 40.41cr in 2015.
5. The debt equity ratio is 3.58. This means one rupee is owner’s money and
3.58 rupees shareholders money which is not good.
25. Opportunities
1. In organized retail sector 28% are from apparels.
2. Growth of organized retail is increased 18% in the current FY
compared to previous year.
3. Consolidation of branded apparels business under one roof.
4. Multiple opportunities to build for women & kids where 16% for
women,11% for men,13% for kids.
5. To expand sales & inventory promotions they piloted use of RFID
technology.
6. Over 180 locations are live on SAP with 2000 plus users &
generated 50 lakh purchase orders.
26. Threats
1. Strong competition from unorganized retail markets, the share
92% of industry
2. E-commerce is an emerging trend in consumers where online
shopping is set to increase from 67% to75%
3. Shopping culture is not well developed in India since malls are
considered as a place to hang around & window shopping
4. Price wars between competitors & their actions such as
bringing in new technologies or increased in their work force to
meet demands.
28. • Only Trent is @ a good position by 2013 and
2014. If the ratio is below 2 then the company
cannot meet its short term obligations. ABFRL
ratio is below 1. It means that the company
cannot meet its short term obligations. It may
affect when they apply for loans. Banks probably
check this ratio for providing loans. If it is below
two then bank may not give loans.
30. • The ratio should be below 1 but ABFRL ratio is
above 3.5. It shows that the company is
depending lot on the outsiders funds than the
owners funds. So it would probably affect the
credit rating.
32. • Almost within 90 days all the 3 companies
they convert their inventory into cash. So it is
good for ABFRL as the capital will not be
locked in the stock.
34. Only ABFRL got a – sign of profit comparatively.
Though it fetched a operating profit , all the
stake holders will look in only for net profit. So
Company needs to settle its loans as to reduce
the interest expenses and make net profits.
36. • As ABFRL got a negative Profits. It could not
make up a turn for its interest expenses. Banks
or financial institutions or investment bankers
may look in for these figures to give loans or
for any investments. So ABFRL should be
prompt in payments to avoid bad reputation
in the upcoming years.
39. KEY INTERNAL FACTORS - Strength Weight Rating Weighted
score
1. It is India’s largest retailer having 1,000 stores across 70 cities in
India(Popular brand with a high presence across India)
0.01 3 0.03
2. It is country’s largest retailer by market capitalization
(10,802.24Crore).
0.075 4 0.3
3. It has about 150 brands in the retail store, which is very high than
the competitors (Shoppers stop-Around 50, Lifestyle-Around 70).
0.02 3 0.06
4. High powerful supply chain management through ERP. 0.02 3 0.06
5. The asset turnover ratio is 1.17:1. This means that for every one
rupee in assets, they generates 1.17 rupees. In other words,
pantaloons is very efficient with its use of assets.
0.15 4 0.6
6. The inventory turnover ratio is 4.33. This means the inventory will
be in hand for 83 days which is good when compared to the rivalries
(Future – 2.92(124 days)).
0.15 4 0.6
40. Weakness Weight Rating Weighted
score
1. The current ratio is 0.6:1. That is for every 1 rupee of current liability,
the company has Rs. 60 paise as a current asset to meet its expenses
0.075 2 0.15
2. There are not functioning internationally. But the competitors’ are
internationally functioning.
0.025 2 0.5
3. The return on capital employed is in negative (-6.82%). This means
the efficiency and profitability of the capital investment is very bad
0.1 1 0.1
4. Their net loss increased to 40.41cr in 2015. 0.185 1 0.185
5. The debt equity ratio is 3.58. This means one rupee is owner’s money
and 3.58 rupees shareholders money which is not good.
0.1 1 0.1
1.0 2.235
It has a weak internal position
41. Key External Factors
Opportunities Weight Rating Weighted
score
In organized retail sector 28% are from apparels. 0.10 3 0.30
Growth of organized retail is increased 18% in the
current FY compared to previous year.
0.15 3 0.45
Consolidation of branded apparels business under one
roof.
0.05 4 0.20
Multiple opportunities to build for women & kids where
16% for women,11% for men,13% for kids.
0.18 2
To expand sales & inventory promotions they piloted
use of RFID technology.
0.08 1 0.08
Over 180 locations are live on SAP with 2000 plus users
& generated 50 lakh purchase orders.
0.04 3 0.12
42. Threats Weight Rating Weighted
score
Strong competition from unorganized retail markets,
the share 92% of industry
0.10 4 0.40
E-commerce is an emerging trend in consumers where
online shopping is set to increase from 67% to75%
0.12 2 0.24
Shopping culture is not well developed in India since
malls are considered as a place to hang around &
window shopping
0.05 1 0.05
Price wars between competitors & their actions such
as bringing in new technologies or increased in their
work force to meet demans.
0.13 3 0.39
Strong competition from unorganized retail markets,
the share 92% of industry
0.10 4 0.40
1.0 2.63
Therefore pantaloons doing well, taking advantage of the opportunities
47. PANTALOONS BCG
STAR
Market growth, WOMENS 24%
PANTALOONS 16%
QUESTION MARK
KIDS 34%
Pantaloons- 13%
CASH COW
Market growth, MENS 7%
Pantaloons 11%
DOGS
Competitors
1 Interference
MARKETGROWTH
MARKET SHARE
Reference: www.ibef.org, Financial statements of the company, www.moneycontrol.com
48. BCG
• From this matrix,
• Pantaloons having three divisions as Men's, Women's, Kids
sections in which the market growth and share of the organized
retail industry is compared.
• Kids is in the question mark region because pantaloons starts to
focus on the growing section and in the star women's it shows
the consistent growth in both market and also in the company
• Declining stage is the too much of competitors in the market
enters in to the organized sector.
51. Rapid Market Growth
ABFRL is India's No 1. Fashion Lifestyle entity with a proforma
combined revenue of about INR 5,500 crore for FY'15, growing at a
rate in excess of 20 percent and EBITDA of INR 532 crore (as of
FY'15) that has been surging at an impressive rate of 30 percent over
the last 5 years.
http://abfrl.com/
52. Cont..
ABFRL altogether hosts India's largest fashion network with over 6,000 points of
sale across over 200 cities and towns, which include more than 2,000 exclusive
ABFRL brand outlets. ABFRL's e-commerce business, Trendin.com reaches out
to multiple destinations across India. With more than 12.5 million Loyalty
Members as of Sept '15, ABFRL has a strong bouquet of loyalty programmes in
India. ABFRL boasts of creating more than 20,000 new designs every year.
53. Strong Competition Position
The ABFRL umbrella includes:
Madura Fashion & Lifestyle
The custodian of several icons, including the top four fashion brands of India - Louis
Philippe , Van Heusen, Allen Solly, and Peter England — each of which
clocked MRP sales in the vicinity of INR 1,000 crore during FY 2015. It also
includes India's largest fully integrated fashion multi-brand outlet chain Planet
Fashion; India's largest premium international brand retailer The Collective; the
country's largest fully integrated, full collection, fashion e-retailer Trendin; and
the British fashion icon Hackett London's mono-brand retail in India.
Pantaloons
India's largest and fastest growing big box fashion retailer, Pantaloons is one of the
fastest growing lifestyle apparel retail destinations in India. Constantly innovating
designs, concepts and products by infusing the latest trends in fashion and
clothing styles, Pantaloons has a repertoire of lifestyle brands to cater to every
consumer's needs across multiple occasions
54. Conclusion
Perfect sync of all the characteristics of Grand
strategy Matrix of Quadrant 1 with the ABFRL
Therefore it has a rapid market growth and
strong competitive position.
56. Key factors-Strength 1st strategy 2nd strategy
Invested $10 billion in ERP Expanding retail
stores
It is India’s largest retailer having 1,000 stores
across 70 cities in India(Popular brand with a
high presence across India)
0.01 3 0.03 3 0.03
It is country’s largest retailer by market
capitalization (10,802.24Crore).
0.075 4 0.3 4 0.3
It has about 150 brands in the retail store, which
is very high than the competitors (Shoppers
stop-Around 50, Lifestyle-Around 70).
0.02 3 0.06 4 0.08
The asset turnover ratio is 1.17:1. This means
that for every one rupee in assets, they generate
1.17 rupees. In other words, pantaloons are very
efficient with its use of assets.
0.15 3 0.45 2 0.30
The inventory turnover ratio is 4.33. This means
the inventory will be in hand for 83 days which is
good when compared to the rivalries (Future –
2.92(124 days)).
0.15 4 0.6 3 0.45
57. KEY FACTORS-WEAKNESS 1st strategy 2nd strategy
Invested
in$10billion
Expanding retail stores
WEIGHT AS TAS AS TAS
The current ratio is 0.6:1. That is for every 1 rupee
of current liability, the company has Rs. 60 paisa as
a current asset to meet its expenses
0.075 2 0.15 3 0.23
They are not functioning internationally. But the
competitors’ are internationally functioning.
0.025 2 0.5 4 0.3
The return on capital employed is in negative (-
6.82%). This means the efficiency and profitability
of the capital investment is very bad
0.1 1 0.1 3 0.3
Their net loss increased to 40.41cr in 2015. 0.185 1 0.185 2 0.36
The debt equity ratio is 3.58. This means one
rupee is owner’s money and 3.58 rupees
shareholders money which is not good.
0.1 1 0.1 3 0.3
58. KEY FACTORS-OPPORTUNITIES 1st strategy 2nd strategy
Invested $10 billion in ERP Expanding their retail outlets
Weight AS TAS AS TAS
In organized retail sector 28%
are from apparels.
0.10 3 0.30 4 0.40
Growth of organized retail is
increased 18% in the current
FY compared to previous year.
0.15 3 0.45
Consolidation of branded
apparels business under one
roof.
0.05 4 0.20 3 0.15
Multiple opportunities to
build for women & kids where
16% for women,11% for
men,13% for kids.
0.18
To expand sales & inventory
promotions they piloted use
of RFID technology.
0.08 4 0.32 3 0.24
Over 180 locations are live on
SAP with 2000 plus users &
generated 50 lakh purchase
orders.
0.04 3 0.12 4 0.16
59. KEY FACTORS-THREATS 1ST
STRATEGY
2ND STRATEGY
Invested $10billion for ERP Expanding retail outlets
Weight AS TAS AS TAS
Strong competition from
unorganized retail markets, the
share 92% of industry
0.10 2 0.20 2 0.20
E-commerce is an emerging
trend in consumers where
online shopping is set to
increase from 67% to75%
0.12 3 0.36 2 0.24
Shopping culture is not well
developed in India since malls
are considered as a place to
hang around & window
shopping
0.05 1 0.05 3 0.15
Price wars between competitors
& their actions such as bringing
in new technologies or
increased in their work force to
meet demands.
0.13 3 0.39 2 0.26
