United Colors of Benetton'

1
United Colors of Benetton.

• Anthony Brown
• Donna Butler
• Paul ONeill
• Erin Mc Coppin
• Lynsey Mc Auley

2
Company Philosophy.

• At the end of the John Ford film, The Man Who
  Shot Liberty Valance, I remember that the
  editor of the Shimbone Star, a small local
  newspaper, declares, In the West, when the
  legend is better than the truth, we print the
  legend.
• 
  Luciano Benetton

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Company Philosophy

• I believe that for the Benetton Group, legend
  and reality coincide. Our international image
  and the substance of our company are the same-a
  global group open to the worldss influences and
  engaged in a continuing quest for new frontiers.
• 
  Luciano Benetton

4
Founders of Benetton.

• Luciano Benetton
• Giuliana Benetton
• Gilberto Benetton
• Carlo Benetton

5
Benettons Headquarters.

• Benetton Groups Corporate Headquarters is
  located at Villa Minelli in Ponzano, 30
  kilometres in Venice.
• The villa was acquired in 1969.
• From the mid 1980s Villa Minelli became the
  headquarters of the group and home of all its
  Strategic Functions.

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Time line for Benetton.

• 1960 Development of Lucianos competitive
  advantage.
• 1965 Benetton was founded and the first factory
  was opened in Ponzano.
• 1966 Widening of the subcontractor relationship.
• 1968 First Italian store opened in Belluno.
• 1969 First foreign store opened in Paris
• 1970s The Benetton Group expansion to represent
  a family of brands which include 012, Sisley and
  Jeans West.

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• 1975 Benetton logo becomes a well known retail
  symbol.
• 1980s The growth strategy of Benetton was based
  around the acquisition of subcontractors and raw
  material suppliers.
• 1983 Advertising and sponsorship campaign in
  preparation for the global launch.
• 1988 Franchisees can now select from a choice of
  12 shop layouts.
• 1989 Benetton have a total of 80 agents
  (internally know as Centurioni)
• 1992 Brought out magazine Colors.
• 1997 Benetton operates in 120 countries around
  the world, with 5,000 store.

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Benettons openings of Megastores.

• 1996 Dubai
• 1997 Rumania, Benetton acquires Benetton sports
  system. Joint Venture with the Inditex Group-Zara
  label
• 1998 Rome, Saudi Arabia, opens its biggest store
  in the world in Milan.
• 1999 Poland, Czech Republic-Prague.
• 2000 Takes over mega stores in Italy, Belgium,
  Moscow, Humburg and the flagship store in Tokyo.
• 2001 Lisbon, Milan, Bologna and opens 1st mega
  store in Shanghai, China.

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Benettons recent additions to their global
network.

• Turkey, Egypt, India and Mexico.
• They are the latest milestone in a structure that
  has its heart in Italy.
• 50 are locally owned joint ventures have been
  established for the production and distribution
  of items bearing their corporate identity.

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BENETTON

• THE FRANCHISING CONCEPT

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REASONS FOR BENETTON GOING INTERNATIONAL

• Italian market saturated by 1970s
• Expansion.
• Diversification.
• Global Market Recognition.

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FRANCHISING DEFINITION

• A contractual relationship between the
  franchisor and franchisee in which the franchisor
  offers or is obliged to maintain a continuing
  interest in the business of the franchisee in
  such areas as know-how and training wherein the
  franchisee operates under a common trade name,
  format or procedure owned by or controlled by the
  franchisor, and in which the franchisee has made
  or will make a substantial capital investment in
  his business from his own resources.
• International Franchise Association

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BENETTON

• ACCORDING TO VIGNALI ET AL (1993) OVER 80 OF
  BENETTON RETAILERS HAVE BEEN FOUND TO BE
  FRANCHISEES EXPANDING OVER 120 COUNTRIES WITH A
  NETWORK OF 5,000 STORES AND AN ANNUAL TURNOVER OF
  2.1 BILLION EUROS

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ELEMENTS OF THE BENETTON FRANCHISING CONCEPT.

• CONTROL
• Agents
• Location
• Price
• Store image Layout
• Advertising
• Exclusivity
• No Royalties
• Uniformity of
  offering
• RISK LIES WITH FRANCHISEE

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Benetton-UK

• The UK operation started in 1980s.
• Geographical proximity.
• London.

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Benetton-UK cont

• PROBLEMS
• Scarcity
• Benetton are guilty of basing their clothing on
  women from Italy, instead of the average UK
  woman.
• Advertising.

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Benetton-USA

• Retail Competitive Market.
• American Sport Industry.
• Young, trendy market.

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Benetton- USA cont

• PROBLEMS
• 2000 US sales 11 of 1.8billion in revenue.
• 2001- 5 of sales in the world's biggest market,
  the U.S
• Sears Roebuck.
• Polarizing ads.

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Benetton-Japan

• Entered 1985.
• Symbolic Market.
• Tourist Market.
• Brand.
• Megastore Strategy.

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Benetton-Japan cont

• PROBLEMS
• Japan is one of the most difficult markets in the
  world.
• Location.
• Deflation Early 1980s 90s
• Earthquakes

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BENETTON

• The company started in 1965, has had a very, very
  successful story which has lasted close to forty
  years

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SUCCESSES

• 2,000 entrepreneurs in 120 countries, 5,000
  shops.
• Europe, Asia America.
• Major programme of investment in megastores.

• Innovation.
• Advertising.
• Cultural related.
• Market growth.
• Market Share.

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FAILURES

• ADVERTISING
• USA
• GERMANY
• DIVESTMENT
• FUTURE

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• DIVERSIFICATION
• Why?
• Diminishing sales
• Competition Gap and Zara

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Edizione Holding
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Clothing

• UCB
• Sisley
• The Hip Site
• Playlife
• Killer loop

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Food Retailing

• Auto grill

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Infrastructure and Services

• Autostrade
• Olimpia
• Grandi Stazioni
• S.A.G.A.T

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Real Estate Agriculture

• Hotel Monaco e Grand Canal
• Relais Monaco
• Asolo Golf Club

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Other Sectors

• Investimenti
• Pirelli C.
• The Turin-Milan Highway
• Amps Banca Antoniana Popolare Veneta

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FUTURE ACTIVITY

• Expansion into Asia
• Sale of Nordica
• Sale of Rollerblade

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ORGANISATIONAL RESTRUCTURING

• The Benetton Family
• The Benetton Group

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ADVERTISING

• The World Food Programme
• Benettons communications campaign
• FOOD FOR LIFE 2003

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The World Food Programme
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ACQUISITIONS

• Benetton won full control of Autostrade
• Future hopes of Autostrade

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FORECASTS FOR THE FUTURE

• Performance forecasts for 2003
• Benettons Future