Benetton Group S.p.A., 2000 Harvard Case Solution & Analysis

"In 2000, Benetton was one of the top mass trend challengers in the world with approximately $1.9 billion in sales across 5,500 shops in 120 nations. But the fortunes of the firm appeared to be on the wane. Operating profits had dropped 9% from the prior year to $299 million. Having almost fit global leader, Gap Inc.'s earnings in 1985, Benetton was currently just one seventh of Gap's size. Inditex of Spain and Quick Retailing of Japan had also passed Benetton in revenues by 2000.

To make things worse, Inditex and H&M had declared in 2000 that they meant to enter Italy, Benetton's heartland. Chairman and cofounder Luciano Benetton was determined to fight back and toward this end had just established a major new retail strategy to enlarge the size of Benetton's present stores, invest in big superstores and assemble greater control of the supply chain. The organization also had high hopes for its new drive into attire and sports equipment. Would this be enough to prevent the rise of its mass fashion adversaries?"


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