General Environmental Analysis Paper
One of the factors that affect the demographic segment of family clothing stores is a considerable population in the industry. Therefore, the corporation does not need to open multiple stores or expand its operations in different markets. The available stalls must meet customers’ needs to prevent expansion that can increase expenses rather than profits (Suttle, 2020).
The other element is changes in spending habits among middle-class individuals. The middle-class families have limited cash for purchasing optional products. Another demographic factor is that most individuals are engaging in family planning processes, which reduce the household population (Suttle, 2020). The retail sector experiences challenges in forecasting sales capacity since the number of buyers are unpredictable.
Graph 1: Middle-class Spending
Source: (Euromonitor International, 2020)
The financial performance of an economy has a significant influence on the economic segment. During the boom period, individuals have access to disposable income. People can purchase clothes that increase sales for retailers in the industry. However, recessions can harm the financial performance of the retail sector because fewer people are willing to buy clothes.
The other element that affects the economic segment is the financial stability of individuals in the country. Most of the citizens in the economy have not attained the average level of economic security (Suttle, 2020). The retail sector might not achieve the sales target because the clients are unwilling to optional items.
Political/ Legal Segment
The first element in the political segment that can influence operations of the food clothing stalls is the imposition of legal policies. The government can control the manufacturing activities of the sector by restricting manufacturers to purchase local materials.
The idea can affect the quality of goods producers, which influences customer satisfaction rates. The other factor can be the imposition of levies. Retailers remit the highest corporate tax in the US (Suttle, 2020). Therefore, the burden might be pushed to consumers by increasing the prices of clothing.
One of the socio-cultural elements that affect the activities in family clothing stalls is sustainability processes. For instance, supply-chain companies are changing materials for making clothes. It increases the costs of clothes and discourages buyers from purchasing the products multiple times.
Besides, sustainability policies are changing, but businesses are accountable for incorporating new processes. Another element that affects the clothing industry is variations in trends (Singh, 2017). The retail industry must change their clothing to fulfill customers’ desires. The graph depicts the performance of fast fashion brands in the industry.
Graph: Fast Fashion vs. Competitors
Source: (Singh, 2017)
Technology has been affecting the clothing industry since its incorporation. The underlying factor that influences the industry operations is the demand and availability of materials. A supply shortage of specific resources, including wool, can affect the production rates of the clothing industry.
However, the introduction of other styles has a significant impact on the old fashion. Advanced technology is essential in improving the quality of items. The clothing industry will satisfy customers, which increases the sales capacity. However, technology can be disruptive, which affects operations in the clothing sector.
For instance, technology has forced retailers to adopt digital promotion and communication methods (Suttle, 2020). Technology might computerize processing activities in the clothing industry in the future.
The variations in clients’ beliefs and practices can influence the retail sector of family clothing. Another factor is accessibility to the items in the industry. Globalization affects the elements since it has transformed multiple activities across the world (Marketing Charts, 2018). Besides, people can access goods using online platforms, which can expand the target market base of clients.
Graph: E-commerce in the Fashion Industry
Source: (Marketing Charts, 2018)
Euromonitor International. (2020). Mexico: It’s all about the Middle Class. Euromonitor. Retrieved 11 April 2020, from https://blog.euromonitor.com/mexico-its-all-about-the-middle-class/
Marketing Charts. (2018). E-Commerce Grows in the Fashion Industry – Marketing Charts. Retrieved 11 April 2020, from https://www.marketingcharts.com/industries/retail-and-e-commerce-106623
Singh, G. (2017). Fast Fashion has Changed the Industry and the Economy | Ganit Singh. Retrieved 11 April 2020, from https://fee.org/articles/fast-fashion-has-changed-the-industry-and-the-economy/
Suttle, R. (2020). The Macroenvironmental Factors Affecting the Clothing Industry. Retrieved 11 April 2020, from https://smallbusiness.chron.com/macroenvironmental-factors-affecting-clothing-industry-37254.html