• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

Analyse the case study with reference to Michael Porter's Theory of Competitive Advantage and answer the following question: Does America have competitive advantage in the textile and garment industry?

Extracts from this document...

Introduction

Analyse the case study with reference to Michael Porter's Theory of Competitive Advantage and answer the following question: Does America have competitive advantage in the textile and garment industry? You answer must include the following elements: 1. A clear outline of Porter's theory with supporting references. 20% 2. An analysis of the case study with reference to the 4 main elements of Porter's Diamond. (N.B. You will not be able to comment on company structure, as the case study does not include information on this. You should, however, refer to factor conditions, demand conditions, firm rivalry and related and supporting industries.) 40% 3. An analysis of the case study with reference to Porter's secondary points of chance and government actions. 20% 4. Your conclusion. 10 % The remaining 10 % will be for grammar, style, clarity, using the correct system of referencing (the Harvard System) etc. Literature: Michael E. Porter. The Competitive Advantage of Nations. Does America have competitive advantage in the textile and garment industry? For a country to have a competitive advantage, it is necessary to understand Michael Porter's Theory of National Competitive Advantage. Michael Porter introduced a model that allows analysing why some nations are more competitive than others are, and why some industries within nations are more competitive than others are, in his book The Competitive Advantage of Nations. This model of determining factors of national advantage has become known as Porters Diamond. ...read more.

Middle

Therefore in this area, it does not have competitive advantage over the Chinese in textile making. Despite globalization, the America has top fashion houses, with brand names. As cost is not a factor in high fashion sector and there are skilled workforce in this area, America has factor conditions to withstand challenge in this area at least. Another factor condition is the pool of knowledge, whether it is scientific, technical and marketing. The case study mentions that the American garment makers offer electronic ordering, automated distribution centers and inventory management systems tied to those of their customers. The best manufactures have learned how to deliver orders at a few days' notice that the overseas competitors cannot match. The country is able to upgrade and remain competitive though innovation. As Porter mentions that factor conditions are not natural or inherited but created and this is an example of it. Last factor condition is the quality of infrastructure, such as transport and communication. This is in plentiful supply and China has a long way in catching up. ------------------------------------------------------------------ Porter argues that strong local demand is essential for increasing a nations competitive advantage. For a nation to be competitive it must possess strong local demand. Local demand: * lets the producer know what the buyer wants; allows then to respond faster to this than producers in other countries This is evident in the case study and for this reason Levi and Gap are already experimenting with scan so that the customer gets what it wants. ...read more.

Conclusion

Porter suggests that countries advance through 4 stages and should look to the stage they are in to get competitive advantage. Summary The American textile industry possesses certain characteristics which suggest it has a competitive advantage in the textile industry. In concern to factor conditions the USA is the second largest grower of cotton after china this is its natural resource. It has a skill;ed workforce to make textiles it also has capital intensive looms which poorer countries can't afford. America has a competitive advantage in textile making. Obviously it does not have a competive advantage in clothes making as china has lower labour cost as the cost advantage is not there. Factories making garments are closing howver this has not affected fashion house as they have established a brand name and people buy their goods and do not worry about the cost. Howver for companys lioke gap it makes sense to locate production in china as price is unbeatable. Cotton is grown in north Carolina and Mississippi they supply cotton textile weaving companies they inturn supply their companies making the clothes. The case study does not deal with the clustering firms . it only talks about production of textile movement to mexico where clothes are made. The essay talks about rivalry between levis and gap. The competition is forcing the companies to innovate and they are working on scanner tio stay ahead of competiton. Competiton has resulted in improving ordering, distribution and inventory management. Opening up the market is causing factory closures the Nafta agreement was reached and this moved [roduction to mexico. ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our AS and A Level Case Studies and Analysis section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related AS and A Level Case Studies and Analysis essays

  1. Marked by a teacher

    Wace Burgess Case Study

    4 star(s)

    They will need to look at planning and implicate it; this could be by using a more short-term term planning and control. This will be planning everything on a day to day basis to cope with the order. They should also introduce a pull control practice if they receive the

  2. Proctor & Gamble, Inc. (Scope Case)

    Threats * Competition (especially Plax and Listerine) * Maturing mouthwash market * Easy to duplicate (cosmetic status (no seals)) The biggest threat to Scope is the increasing competition from Plax and Listerine, who are growing faster than Scope in the industry.

  1. Microsoft Case Study. Objectives, structure and marketing.

    This can be said as it within a small period of around 10 years of console and second release of console the Xbox 360 gained 39 million sales worldwide which surpassed the original consoles market of Playstations which had a massive customer base for years.

  2. PEST is a planning tool which is used by a business to evaluate and ...

    This means that people will be less likely to eat Ginsters original pasties as they are made with a high percentage of meat a lot like most of Ginsters products. This could be seen to many people as not as healthy as other products in the savoury food market made from other businesses so they will buy a healthier option.

  1. NHS change management

    It sets the dynamics for the relationship and defines the detailed practicality of the work to be done. It is distinguishable from the formal written contract of employment which, for the most part, only identifies mutual duties and responsibilities in a generalized form" (Wikipedia, 2008).

  2. The main purpose of this research is to know and analyze whether the Olympic ...

    can give the information that is needed for them in the locations they were travelling. 2.9 London Tourist Attractions and 2012 Olympics Many of the attractions are present in the city of London to present to the tourists who will be coming for the tour.

  1. SWOT and Pestel analysis for Carlton Forum leisure centre

    Resources Tangible Strength Weakness Capabilities. Car park Providing free parking spaces making the business more accessible. All weather pitch Resurfacing the pitch to increase participation, currently not using it to its full ability. Kids gym Currently using the facilities to meet the objections of increase participation but not making anything as its no cost for the school who currently occupies it.

  2. I will be identifying the legal criteria for offer and acceptance in a valid ...

    Daniel was rejected the chance to complete his purchase on Monday, and that is something he can sue Angus for as he already went into contract with him by giving him the one he did on Saturday, so Angus had no right to refuse to allow him to complete his purchase.

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work