Sainsbury’s Tu Clothing Analysis Essay
Established in 1869, Sainsbury’s is the third largest store of the UK followed by the lead of Tesco and Asda. Also, Sainsbury’s has managed to score the 80th position at the Financial Times-Stock Exchange 100 Index (FTSE 100 Index). Furthermore, the market capitalization of Sainsbury’s is estimated to be £ 5,457.35 million.
A clothing line by Sainsbury’s, Sainsburys TU, was introduced in 2004 which majorly focuses on the attires of adults and teenagers. The brand name TU has a French origin which means “You,” hence Sainsburys Tu means “Clothing for you.”
The Company’s Operation:
The clothing line of the Sainsbury’s brand deals in the consumer market of women wear, men wear, old age clothing, children wear, and also baby wear. Also, they have an enormous collection of clothes suitable for diverse occasions such as party wear, casuals, formals etc. Furthermore, the price charges are maintained proportional to the quality of the clothes. Thus, one can locate lowest, moderate, and finest quality altogether under one roof at the Sainsbury’s store.
Market Share And The Company Hierarchy:
Currently, the board of the company is chaired by David Tyler, and Mike Coupe is the current CEO of the company. The major shares of the company are held by:
- Sainsbury family has a share of 15% in the company.
- Qatari royal family possesses an enormous share of 26.145% in J Sainsbury Plc.
- Lord Sainsbury of Turville holds 5.83 % share in the company.
- Lord Sainsbury of Preston Candover adheres a 3% share in the company.
The Environmental Analysis:
Generally, environmental analysis can be grouped into two categories: micro and macro. The macro environment can be defined as a fettle which imparts effects to the economy as a unit, such as the gross domestic product (GDP), inflation, fiscal policy etc. On the other hand, a microenvironment analysis signifies the internal environment of the company. In other words, a microanalysis discusses the occurrence of minimal forces in the company which affects the company’s efficacies to serve its consumers.
To paint the perfect picture of the above mentioned environmental analysis, let us comprehensively discuss the macro and microenvironment of Sainsbury’s TU clothing line.
The macro environment can be influenced by social, legal, environmental, political, and employment elements that locate the opportunities and threats for the company.
Legal Binding And The Political Influence:
Agreement on Textiles and Clothing (ATC) regulations are imposed on the Sainsbury’s brand, and thus TU is liable to follow the standard rules established by the ATC. The obligatory conditions to abide by are listed below:
- To import clothes from the European Union (EU), the trade experiences no restrictions apart from the Value Added Tax (VAT) and the excise duty.
- Importing clothes from places other than the European Union countries requires an import license. However, the nature of this license can be dictated as either trade specific or product specific.
- In order to sell and purchase imported clothes, it is essential to follow the rules and regulations of the UK domestic business standard.
- To import the clothing for children wear, the practices implemented by the British Code of Practise (BSI) should be exercised. Some of the examples of the British Code of Practise (BSI) may include the Children’s Clothing Regulation 1976, Nightwear Regulation 1985, and the General Product Safety Regulation 2005.
The Economic Factor:
In 1990, after the time of recession, the clothing charges experienced a hike of 6.4%. Ever since the exchange rate has also experienced a drastic shift contributing to the increased prices of the clothes. In this connection, the Daily mail reports air charges and prompt increase in fuel prices to contribute towards inflation while increasing the living expense of the UK residents.
The Taxation Policy:
The Taxation policy dictates implication of tax on every retailer and Value Added Tax (VAT) has to be satisfied in accordance with the updated version provided by the UK government. However, the retailer can garner some tax deduction if he purchases or intends to buy specialized clothing tools for the industrial operation.
The Environmental Factor:
Sainsbury’s is interested in reducing its share of pollution towards the planet and is employing techniques which may make this objective achievable. On this account, Sainsbury’s has cut off its carbon dioxide emission by a large fraction. In order to achieve its targets, the company’s program reset of the Eco stores and the refrigeration process are the major initiatives. Furthermore, Sainsbury’s TU has taken keen measures to eliminate the major chunk of its waste by replacing polythene cover with eco-friendly material. In this connection, Sainsbury’s has introduced compostable organic packing in the year 2002 and 2006. It has been claimed by Sainsbury’s that this packing is 90% recyclable.
In addition to this, to motivate people to invest their share in pollution eradication, Sainsbury’s came up with an idea of Nectar loyalty point in the year 1990. Thus, whenever a customer made use of his/her personal bag, Sainsbury’s awarded him/her with some discount.
The elements which may influence the efficacy of an organization can be determined by the Strengths, Weaknesses, Opportunities, and Threats (SWOT) analysis:
- Possesses a wide clothing range with a vast variety in the stores.
- Earned the loyalty of customers by means of appealing promotional strategies.
- Renders product promotions which are liable to attract the consumers while gaining an affirmative response.
- Provides reliable and easy to follow payment modes to the customers.
- Presents promotion schemes in a very intriguing manner to clasp the attention of the huge fraction of the audience.
- The need to develop weekly schemes to accommodate the short-term purchasers and outperform the competition prevalent in the market.
- The requirement to establish more outlets so as to add an element of convenience for the masses residing afar from the current stores.
- The exigency to hire sales personnel to garner the maximum level of consumers’ loyalty.
- The requirement to keep a check on the price comparison as many supermarkets opt to supersede others by introducing cheap product charges.
- The need to introduce more discount offers to compete and maintain a tough competition with the other supermarkets.
- The potential to attract the Marks and Spencer’s and Waitrose’s customers because of the similarity prevalent in the products and price ranges provided by these supermarkets.
- Should introduce promotional short-period based schemes on the majority of its products.
- Should equip its consumers with the low prices to become more economical than Waitrose and Marks and Spencer.
- Avoid purchasing and selling items that have surpassed their expiry date as they will induce a negative response from the consumer market.
- The minimal scope to impose cheap product charges without affecting the market share.
- Tesco is opening up a large number of stores to supersede the potential of Sainsbury’s.
The Company’s Target:
A deep insight into the store’s collection presents TU as a brand which targets both the female and the male gender cloth wear. However, if you consider the psychographics results, the adults and the teenagers are the biggest consumers of Sainsbury’s TU clothing. The reason this brand has appealed the adults and the teenagers is due to its remarkable collection accessible within the reasonable price range.
Targeting Strategy Implemented By The Sainsbury’s:
Sainsbury’s Tu has garnered a large fraction of customers by putting its immaculate features of product, promotion, quality, price, and distribution strategies to the best of use.
As teenagers are the largest consumer market for the Sainsbury’s clothing line, the clothes of the company should showcase the required attributes of the latest trends in fashion. Therefore, Sainsbury’s invests an ample amount of effort to fit its product in the paradigm of the latest fashion.
In order to gain a prompt positive response from the audience, Sainsbury’s has always used effective and strong marketing strategies and methods to attract its targeted audience towards their products. On this account, TU has always hired young artists and has installed the medium of TV channels to entice the masses towards its product.
As the teenagers are mostly enrolled in a college or university, the prices are liable to be maintained moderate for the respective target. Since millennial are picky when it comes to choosing an outfit, they are likely to disregard cloth wear which is cheap but low-quality. Thus, TU has always invested its utmost efforts to maintain the balance of quality with reasonable product charges.
Sainsbury’s has made its products easily accessible to the consumers by establishing online stores which eventually add to the volume of the Sainsbury’s consumers fraction. Specifically, these virtual stores are ideal for teenagers who would prefer ordering online than going on shopping afoot.
Sainsbury’s has successfully achieved its set objectives, and it’s growing its dominance in the retail clothing sector by leaps and bounds as compared to the other supermarket competitors. Nevertheless, in order to maintain its supremacy, the Sainsbury’s TU should keep itself accustomed to the rapidly changing fashion trends to keep the requirements of its picky customers in check.