Background analysis of PADINI

PADINI started to operate its company in Malaysia’s apparel industry, manufacturing, trading and supplying garments to order for retailers and distributors. The PADINI Concept Store is a concept store that selling all PADINI Holdings brands in one store or “one stop shopping”. The first outlet that starting to operate in Malaysia was located in Johor Bharu City Square, a shopping complex in Johor Bharu, Malaysia.

After PADINI starting to operate in Malaysia, it becomes one of the major forces to apparel and garments industry in Malaysia. Besides, PADINI involved in the distribution and retail of its own fashion labels through 190 freestanding stores, franchise and consignment counters.

The main products that sold by PADINI are formal,fashion wear and accessories. Besides, there are various brands that houses in PADINI and all of them are under PADINI. Every brand represents a fashion philosophy and each of the philosophy involve an extensive range of products aimed at targeted consumer. Their brand image is strongly attached importance to the real value: quality, functionality and price.

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There are eight unique brands under PADINI, which are PADINI ,PADINI Authentics, PDI, P & CO, Seed, Miki, Vincci, and Vincci Accessories. All of the brands targeted consumer is due to both sexes and all ages. However Vincci, and Vincci Accessories are more focused on the flexible tastes of woman consumers on shoes, bags and accessories, and Seed Café have open a new dimension in food operations for its company.

Vision

“PADINI state that their vision is to be the market leader in the retail industry.”

They will achieve the goal through hard work, discipline and creative endeavour. In long terms, they will continue to maintain their high standard of design and manufacturing quality as well as affordability. Besides, they are also working towards expanding the business on a regional basis. At present, they have a growing presence in their neighbour countries, and we believe that there is great scope for growth.

Mission

The mission that set by PADINI is to create credible products that meet out target customer requirements but exceed their expectation.

PADINI Core Value

Caring From The Heart

Caring from the heart means every staff of company must treat customers from the heart; staffs must care their customer by providing the best services.

PADINI’s 7 Culture

Speed

Simplicity

Self- Confidence

Communication

Team Work

Learning Culture

Consistency

Evolution of PADINI

Year

1971-1990

Began operations as Hwayo Garments manufacturers Company, a proprietorship carrying out the manufacturing of ladies garments and wholesaling of the finished products to departmental stores.

Expand into the trading textiles.

Entered the retail industry with the company’s pioneering brand PADINI.

The brand VINCCI was created.

Children wear was launched under MIKI brand.

The SEED and ROPE labels were launched.

1991-2007

Establishment of a holding company, Home Stores Sdn. Bhd., to hold all the group’s retail, wholesale and manufacturing business.

The name Home Stores sdn. Bhd., was changed to PADINI Holdings Sdn. Bhd.

Launched of PADINI AUTHENTICS.

PADINI Holdings Sdn. Bhd. Became PADINI Holdings Berhad.

PADINI HoldingsBerhad listed on the Second Board of the KLSE. P&CO was launched in the second half of the year.

PDI was created.

The first Concept Stores was opened in Johor Bharu City Square.

Seed Café and PADINI Dot Com Sdn. Bhd was set up.

Re-launcg of PADINI and Rope to new PADINI Workwear

Listed on the Main Board of the KLSE

The brand Vincci +. Vincci accessories and brands outlet was launched.

STATES

LOCATION

Selangor

AEON Bukit Tinggi Shopping Centre

Sunway Pyramid Shopping Mall

Ikano Power Centre

1 Utama Phase 2 Shopping Centre

IOI Mall Shopping Centre

Kompleks Membeli Belah, Aeon Cheras Selatan

Johor

Bukit Indah Shopping Centre

City Square Shopping Centre

Jusco Tebrau City Shopping Centre

Kuala Lumpur

Mid Valley Megamall

Pavilion Kuala Lumpur

Penang

Gurney Plaza

Queensbay Mall

Melacca

Dataran Pahlawan Melaka Megamall

Pahang

East Coast Mall

Perak

Kinta City Shopping Centre

Sabah

Warisan Square

Sarawak

The Spring

Map of PADINII coverage

The Location of PADINI Concept Stores In Malaysia

Segmentation

As a listed company with such successful result, undeniably PADINI has done segmentizing in terms of demographic, geographic and psychographic.

Demographic segmentation include of dividing the market into groups based on variables likes age, gender family size, income, occupation, education, religion, race and nationality. PADINI has segmentized demographic by focusing on the factor like age, gender, income and occupation as the important factor to do the continuous targeting. PADINI has set up 8 brands, which has covered age from baby up to old ages ,gender with male and also female, income which in the range of RM1000-RM2000,RM2001-RM5000 and RM5001above,and finally occupation like office-worker and others semi formal wear which suit majority occupation. This helps the organization to divide the market into several groups and target each of these groups to enhance the performance of the organization.

Next, market segmentation strategy whereby the intended audience for a given product is divided according to geographic units, such as nations, states, regions, counties, cities, or neighborhoods. PADINI has chosen to focus on states as their geographic segmentation, for instances, Penang, Johor and Kuala Lumpur.

Lastly, PADINI has also used Psychographic by dividing the industry into different groups based on social class and lifestyle to do perfect segmentation.

Targeting

From our research, we can say that the targeting strategies used by PADINI is differentiated marketing where PADINI target several segment by offering different products to satisfy the different groups of customer. The targeted groups of customer are derived from the age range that above 7 to 50 and separated according to age and genders. The following table is showing the different targeted groups by offering different products.

Group

Age

Gender

Product

Type of product

Infants and kids

Below 7

Both

Miki kids

Casual

Childrens

Above 7 and below 12

Both

Seed and PADINI Authentic

Casual

Teenagers or youngsters

12 to 18

Both

Seed and PADINI Authentic

Casual

Adult

18 to 30

female

P & Co

Younger style(Trendy)

Adult

18 to 40

Both

Seed

Casual plus classic stylish designed

Teenagers or adult

13 to 50

Female

Vincci and Vincci Accessories

Female Accessories

Adult

18 to 50

Both

PDI

Casual stylish designed

Adult

18 to 60

Both

PADINI

Formal

Differentiation & Positioning

PADINI used the differentiation strategies of product and image to place the product occupies in the consumer’s minds. The hottest product of PADINI – Seed, use the product differentiation in term of design to place the product occupies in the consumers’ minds. For example, when a consumer want to buy a semi-formal with classic stylish designed, the Seed’s product will come into their minds before thinking of others brand. Besides, Miki kid is also one of the example of product differentiation where the design is specialty for kids. On the other hands, P & Co used the image differentiation to place the product occupied in consumers’ minds. When a consumer want to buy a female clothes with younger style inside the PADINI, the brand of P & Co may take the advantage of coming to their mind before others brands. In short, PADINI use the differentiation of professional ,stylish and fashionable to position the products in the consumer minds.

Product

Consumer Goods are final goods that are brought from retail stores to satisfy the needs and wants of customers. Products of PADINI falls under consumer product which categorized as shopping products.PADINI itself has other alternatives brands under it. There are PADINI, Seed ,Pdi , PADINI Authentic , P&Co, Miki maternity , Vincci , Vincci accessories , Miki kids .

The essential of PDI is to emphasis the casual stylish that can be accepted in any occasion. It’s purpose to let any guy or girl to get a style fix among the fashion-current jeans, T-shirts, jackets, casual basic-T, belt, socks, scarf and even accessories in a shopper-friendly setting.PADINI is focus more on basic and family lifestyle and aim for anyone who likes and extols casual style.

PADINI provides the essential working lifestyle for the modern working man and women. The PADINI collection carries a clean, timeless and modern to the working lifestyle. This brand is focuses on the formal wear and centralize customers base for workers. PADINI has launched out several of tie, belt, shirt and coat.

Seed is the confidence of classic and casual plus a refreshing design. Seed emphasize the best of both designs for men, women and even hip kids! The purpose is stand-out style. Seed is focus on urban office-wear for the masses. The clothes under this line are usually jackets, coats, suits, classic office pants and knee-length skirts, semi-formal skirt and belt and also classic jean. In addition to seed cafe, the cafe portrays a bright and contemporary concept which jells with seeds youthful and trendy image.

PADINI authentic is more on casually yours. PADINI authentic focus their styleon quality casual wear. Its targets the teenager segment of the market. It sells modern shirt, trendy jean, jackets, shirts and stylish dress.

P & co is focus on female market and launched all girls skirt, necklace and also hot pants. On the same track where they run ahead in fashions brave new ideas. Women are the largest customer base for P & co because they know that women are the most potential customer and most people who are willing to spend money in the fashion.

Miki Kids take the message of fun in fashion to every place and occasion. Clothes design with energetic ideas and cheerful colours to charge up every youngster. Miki kids are designed for 1-11 years old infants. This is because infants still have their potential and parents are increasingly willing to spend money on their child’s dress.

Miki Maternity is designed for fashionable mums-to-be. Miki Maternity has sold all the shirt and dress that suit for the pregnant women at the same time stand out-style.

The look of Vincci fun and fashionable, the emphasis is affordable. From head turning hair accessories to trendsetting footwear, must-have handbags to eye catching glasses and fashion-clinching belts.

In addition to Vincci accessories carries one of the most extensive lines of accessories from necklaces, bangles, rings and earrings to belts, sunglasses, watches, shoes, bags and more in all the latest styles.

Price

Pricing are one of the most important elements of the marketing mix, as it is the only mix, which generates a turnover for the organization. Pricing is difficult and must reflect supply and demand relationship. Pricing for a product too high or too low could mean a loss of sales for the organization. 

Designed of Seed and PADINI are more classic. Our company carries out market-skimming pricing and setting a high price for Seed and PADINI to “skim” revenues layer-by-layer from those willing to pay the high price. Both of these brands are premium pricing and especially for relatively high consumption of the customer base. High consumption of the customer’s base is those who purchase a bundle items in one time. Production of seed and PADINI are much more less than other brand this is because high consumption of the customer base would be lesser. Our company makes fewer, but more profitable sales.

In addition to this, PDI and PADINI authentic and Vincci are much more affordable. Our company carries out maket-penetration pricing setting low initial price for PDI, PADINI authenthic and Vinnci to penetrate the maket deeply. Both of these brands are low cost pricing and more focus on the middle class of customer base. Product price of these two brands are low and affordable. This is because there are more middle class of customer base compare to high consumption of customer base. PDI and PADINI authentic are attracting many customers due to the low price strategy and also our company can win a large market share.

Apart from this,the two brands under the MIKI flag are MIKI Kids and MIKI Maternity.Miki maternity is pay attention on the fashionable mums-to-be. This brand only focuses on the pregnant women and mums-to-be customer’s base and Miki kids is focus on the children customer’s base. Product price of this brand is quiet high and is consider as premium pricing. This is due to their customer’s base not wide enough

Promotion do

PADINI Holdings Berhad company has different promotion in every seasons . They have different seasons in every years . That is spring ,summer ,fall and holiday . Those products have expensive price will have whole year discount . On the other hand , those products have cheap price only will get discount during season period .

PADINI AUTHENTICS promotion will get instant rebate RM30 with purchases of RM150 and RM70 with purchases of RM 300 . PDI Promotion will get rebate RM15 with every purchase of RM 100 .

Followed by, VINCCI ACCESSORIES will get instant rebate RM10 with purchase of RM50 & above RM20 with purchase of RM100 & above . VINCCI Promotion will get instant rebate RM10 with purchases of RM50 & above , RM20 with purchases of RM100 & above. SEED Promotion will get rebate RM30 with every purchase of RM 150. P&CO Promotion will rebate rm20 with every purchase of rm100 . PADINI Promotion will get rebate RM30 with every purchase of 2pcs .

In addition , PADINI GROUP FAIR which known as Mega Carnival Sales will up to 70% discount .This sales will fall on March , August , December every year .Specific terms and condition will be applied on it . During sales period, customers cannot apply for member card . Member card only can apply when no sales proceed. When nearly reach end of sales, PADINI Company will have actual 10 % will add 10 % more discount on it . This is because PADINI company want clear the stock, and they want to push the sales.

A company’s total promotion mix is also called marketing communications mix . It consists advertising , sales promotion , public relations , personal selling , and direct-marketing tools that the company uses to persuasively communicate customer value and build customer relationships .

One of the hardest marketing decisions facing a company is how much to spend on promotion. How does a company decide on its promotion budge? There are four common methods used to set the total budget for advertising. There are the affordable method, the percentage of sales method, the competitive parity method and the objective and task method .

Affordable method is to set the promotion budget at the level management thinks the company can afford. Followed by , percentage of sales method is set the promotion budget at a certain percentage of current or forecasted sales or as a percentage of the unit sales price . Competitive parity method is set the promotion budget to match competitor’s outlay .

Placement do

Concept Store brings the ‘all in one’ concept. So that, customers will be convenient to shop at there. Variety of modern style can be chosen by customers. All they need are inside one shop. Most of the brands outlet will located at the shopping mall instead of hypermarket. Because of the design of shopping mall more attractive. So that can attract more customers.

PADINI is one of the most well-known brands in Malaysia’s multibillion garment industry. A brand leader involved in the distribution and retails its own fashion labels through 180 freestanding stores and in-house outlets. This includes our multi-brand stores of PADINI Concept Store and Brands Outlet.

PADINI have many branches in Malaysia. In Malaysia, it divided into two parts. That is west and east. Shopping mall will be chosen as the location where the PADINI Concept store at. This is because shopping mall has more people. For example, Queensbay Mall, Gurney Plaza .It will choose only mall which is more trendy for that city .

PADINI has two types of shops. It has brands outlet and PADINI concepts store. The purpose of having PADINI concepts shops is because of the concept “one-stop-shopping”. With all brands within reach in just one store, the shopping option is set to create a fashion revolution. In addition, certain brands specialize in items such as Graphic Tees, Polo-Tees and Pants. With such a wide variety of styles and labels, Concept Store not only caters to everyone irrespective of age, gender or taste, it also allows shoppers to mix and match effortlessly within one location ,maybe by matching with different brand’s merchandise to fulfill own required style. The brands are PADINI, Seed, Vincci, PDI, PADINI Authentics, P & Co, Miki Kids & Miki Maternity. Whereas , brands outlet is the latest exciting concept from PADINI group . Already a fashion force in Malaysia with brands such as PADINI, Seed,PDI, Vincci and P&Co., the group decided to introduce a shopping experience with a difference based on key ideas of convenience, quality, variety and affordability.

Concept Store can be found at Aeon Bukit Tinggi (Klang), Ampang Point (Kuala Lumpur), IOI Mall (Puchong), Ikano Power Centre (Mutiara Damansara; flagship store), Aeon Bukit Indah (Johor Bahru), Dataran Pahlawan Mall (Melaka), East Coast Mall (Kuantan) and Queensbay Mall (Penang).

Recommendation

After the overall marketing research regarding this company, we would make some recommendation about the product, market development, marketing technique, public promotion and sales rules and regulation.

Talking about the product, PADINI has never come out with unisex merchandise, as our experience as promoter in this company, we always get this question from customer .Also, we would suggest PADINI may make some couple design since the company is already well-established, these two product may probably open a new market to new young generation as their target, the company may choose the A outlet to do market testing by coming out limited quantity.

While for marketing technique, we can see PADINI has not yet to explore in the online buying. We suggest PADINI can set up a blog which contain all brands product. Before that, perhaps the company must set up an IT department to do IT support for future transaction and create a IT system to company. They may co-operate with some banks to offer discount by using online banking service. On the other hands, PADINI can also cooperate with some local distributors in the Malaysia like Citi-link or Sky Net to send out the order. Every transaction made by the customer will be shown a payment statement and it was guaranteed by the bank. Besides, the distribution of the order will directly send to the stated address according to the information stated on the order form by the customer.

Then, since PADINI is already well-known in fashion industry, we believe they are able to do a fashion show by hiring professional model, wearing their new products and having a fashion show .The company may invite some fashion professional ,helping to to advertising and promote their company. Besides, the company can organize a model show or competition by wearing their new products in specific mall like Gurney or Mid Valley, this will cost lesser. Furthermore, PADINI can sponsor to some well-known ladies magazine with conditions that include few pages which advertising about PADINI new products in every publication of magazine, for example Vogue and Nirvana Women.

Historical Net Profit of PADINI From Year 2004- 2010

The histogram above showed that the net profit of PADINI from the year 2004- 2010. We can see that, the net profit of PADINI is dramatically increase from 2004- 2010 with the percentage of 1% to 12.2%. Besides, PADINI state that they forecast an average annual net profit growth of 10% in year 2011 and 2012 because of the demand for the PADINI products due to their strong branding and strategic store locations, as well as improved efficiency of warehousing, inventory management, design and product mix.

Stock Split

Besides, PADINI also carry out the stock split program to make its stock price cheaper than before in 5 times at 6 January 2011, being the market day after the books closing date. Share split involving the subdivision of each ordinary share of RM0.50 each

held in PADINI Holdings Berhad into five ordinary shares of RM0.10 each. This action is to attract more investor to invest into their company.

PADINI HOLDINGS BERHAD (History earnings, dividends and share price)