Report On The Brand “Charles And Keith”

Introduction of the Company

Charles & Keith was founded in 1996 by a pair of brothers, Charles Wong and Keith Wong. The company is based in Singapore and has eventually hit the overseas market throughout Asia and other parts of the world like the Middle East, Europe, America and Africa over the years. The brand is styled as “CHARLES & KEITH” and basically produces fashion statement pieces from various types of footwear to all sorts of bags and accessories such as earrings, key chains and phone cases, mostly designed to cater to the females. Before its’ very first store was opened in Amara Shopping Centre, Charles and his younger brother Keith worked at their parent’s shoe store to gain some basic business operation experience and in order to be able to stand out, the pair of brothers started designing their own shoes in 1997 based on customer’s feedbacks. Not long after, Pedro was launched under the company as a brand which solely focus on men’s footwear and accessories like belts and sunglasses only 2 years after, in 2007.

PESTEL Analysis

Political

Singapore is well-known for being one of the safest countries in the world. We’re a small city well governed by our respective governments hence political issues isn’t one of the major factors that will affect many businesses locally, making it a great place to start a business.

Economic

According to statistics, our country is crowned consecutively for years for being in the top 5 list of the richest country. Although locally, the economical scene hasn’t experienced a great fluctuation due to the stability of constantly achieving great success in the economical sector, Charles & Keith had faced difficulties dealing with overseas management. The company boldly expanded to Taiwan and followed by Indonesia, one of the worst countries affected by the Asian financial crisis back in 1998, resulting in great challenges faced as factories were not doing well and the brothers had to directly come to an agreement with them. After all, they turned crisis into opportunity by gaining more control over the production process and continued picking up from where they left off from the previous setback that they’ve encountered.

Social

All products made by Charles & Keith are targeting towards and attracts mostly the young to mature adults, female specifically, as well as young children. In recent years, flats designed for adults were also made into miniature versions, suitable for parents who have kids. Price wise is considered rather affordable, anybody could easily afford it especially in Singapore and adding on, the prices haven’t changed much over the years. Premium quality faux leather is used for products made hence it doesn’t prevent any specific group of religion from using it.

Technological

Constantly keeping up with the trends and coming out with new collection range of products every now and then is nothing new for the company. Hence, being able to survive for over two decades now and is still widely liked among the females. Besides the physical stores, an online platform that serves as an alternative for purchasing goods is available worldwide along with social media platforms like Instagram which updates regularly on new releases for the new seasonal collection, keeping the consumers updated.

Environmental

As most of the materials used for the company’s products for production doesn’t greatly come into contact with the weather, this is not an important factor to be taken into consideration as factories are operated indoors. However, as safe as Singapore can be, there are times when natural disasters can occur anytime without warning, affecting overseas business’s operations. In that case, the economical sector would be affected based on how severe the situation is and thus having a direct impact on businesses overseas which could cause the company to suffer losses.

Legal

Currently in Singapore, it is really easy to set up a business of your own, be it a tangible or intangible organization. It only takes less than a day to complete the process for the first step of starting up a business, the legal certificate to run a business locally. Thus, making any company, including Charles & Keith to start up one without much trouble and restrictions as long as basic requirements are met.

Porter’s Five Forces (Competitive Industry Environment)

Competitive Rivalry within an Industry

There are many shoes and bags retailing stores out in the market today, what makes one stand out from the rest and appeal to the public is the key factor in achieving success. As mentioned previously in introduction, the pair of brothers started designing their own shoes based on customer’s feedbacks and they constantly come up with new ideas that fit the current trend to appeal to the public.

Threat of New Entrants

This factor might not be a possible threat to the company Charles & Keith due to its’ constant achievements and being a reputable brand for the past 28 years. Although nothing is definite in this industry, minimizing the possibility of threats by new entrants by establishing and upholding a strong branding strategy is highly advantageous.

Threat of Substitutes Products or Services

Companies which fall behind in the industry are usually the ones who don’t create mind-blowing and attractive products or services to capture the attention of the consumers, failing to make the public trust in a certain brand or company. While current technological advances, better yet cheaper products could enter the market anytime and easily replace the old ones. With Charles & Keith’s effort in making continuous improvement to the brand as well as it striving in making the line of products worthwhile for consumers, it seemed like the company is nowhere near of getting replaced or kicked out of the industry anytime soon in the near future.

Bargaining Power of Suppliers

A supplier will only have the power to raise up the cost of manufactured goods when it has several clients to supply. Being a company, which took supply from the same supplier since ages ago, creating loyalty between the client and supplier relationship through thick and thin is an important point. There are no suffice information on Charles & Keith’s supplier, whether did the company change it on a regular basis due to unforeseen circumstances for example disagreements, financial related issues or even the shutdown of a factory due to short of manpower or funds, we won’t know as these are internal struggles that companies won’t disclose. As long as Charles & Keith is still managing fine and that nothing major affects the customers in terms of product quality or price for example, the company still can run its’ business well.

Bargaining Power of Customers

Loyal customers are those who hold the power in bargaining since they own a large share of products from the company. In Charles & Keith’s situation, a membership privilege is offered. However, as much as customers like these bring in profit and value for the company, the business will also have to come up with a strategy to please the customer and make them stay loyal to the brand. For example, coming up with exclusive promotions or sale for a limited amount of time during a certain occasion for the members who are loyal buyers that have hit a minimum requirement set by the company.

Recommendations

Charles & Keith did mention that since the very start in 1997 they designed their own shoes based on customer’s feedbacks. Of course, while that is definitely one of the selling points of the brand that made it do so well, there would still be inevitable cons that follow. Personally, I do own a few pairs of Charles & Keith shoes as well as bags, wallets and even phone cases. For items such as bags, wallets and phone cases, they’re affordable considering the material and how durable each piece is apart from the fact that it’s designed simply with just enough compartments in a wide range of choices to choose from, the best part is each series will change from time to time every season. However, for footwear, it isn’t the most comfortable shoes to walk in, although I have no idea about what the majority’s opinions are as there would be conflicted opinions. For example, I’ve gotten myself a pair of sandals during sales promotion a few months back and it is supposed to be comfortable as I’ve tried it in the store itself before making my purchase. To my utmost dismay, I find it really hard to walk in afterwards for a long distance due to the extremely stiff leather material scratching against my bare skin all the time, making the heel and ankle of my feet peel and bleed. I believe that is the last thing a customer would want to go through after purchasing a pair of shoes as even after countless attempts to salvage it with patches, nothing worked out which resulted in a waste of money and product.

Comfort in Footwear

Comfort is the key factor when it comes to footwear without a doubt. What they could’ve done instead of designing it exactly the way customers want it to be like, is to implement it slightly, test wear it before sending it to the factory to make sure that the internal design of the shoe and material is wearable in the long run. Some customers may not know what works the best in terms of comfort hence focusing only on the exterior hence despite taking feedbacks into consideration, other important key factors have to be focused on as well to avoid losing customer’s trust and loyalty in the brand.

Membership Policy

The membership program is one of the long-term promotional strategy that Charles & Keith has implemented in order to reward loyal customers of theirs, that of for every $500 spent in a year, 10% off any non-promotional items in the store is permitted. However, little did they realize that most of the customers are females are ranged from as young as teenagers or students, to working adults. Such system would only benefit adults who’ve started earning money for themselves to be able to spend up to a sum of $500 a year which most students wouldn’t be able to afford to do so. In order to attract more consumers and make them stay loyal to the brand, cutting the minimum spending or extending the period in order to attain the 10% membership discount would be ideal.

Promotions

With observations for a period of time, Charles & Keith do not frequently hold promotions or sales. Even during festive seasons, either products on offer are not widely ranged or that usually it consists of really old collections. As much as it’s the company’s effort to save as many leftover products in the old collection range, taking a customer’s point of view into consideration is also as equally important. They don’t have to include the latest collection into the offer range as that would have made losses for the company but instead, widen the variety, include certain mid-range collection or even limited-edition items to attract a wider crowd.

Outlets Distribution

The company has reached its’ milestone of being the first shoe retailing brand in Singapore to launch an online platform. The purpose of it is to be able to reach out to consumers who live in areas where physical retail stores aren’t available in their region due to convenience purposes. To save the hassle and unnecessary investment, despite Charles & Keith’s growth and constant success, cutting down on distribution of outlet stores in certain countries or cities would be advised as more focus could be shifted to other aspects of the company.

Conclusion of Current State of the Company

“CHARLES & KEITH was founded with a vision to empower women around the world to express themselves freely through fashion”, a brand which constantly strives in getting better ideas, coming up with fresher and better made products to make itself stand out from the competitive industry. The company also believes in social and environmental responsibility, creating an environmentally friendly image for its’ brand. Due to great success, Charles & Keith currently has over 300 stores worldwide and an online purchase platform which is regularly updated is available as well for convenience sake. “A leader must be able to listen and understand the needs of his customers and employees”, a quote by Charles Wong, who only managed to attain an O’ level certificate as his highest education level, showing that as long as the passion is there, anything can be achieved.