BROOKS BROTHERS, INC. Moving to Italy

Company History 1818: Henry S. Brooks opens Brooks & Co. in New York City. 1830: Creation of “Seersucker” suit. 1833: Brooks Brothers becomes a Corporation. 1896: Creation of one of Brooks Brothers best selling items : the “button-down polo collar shirt.”

Company History (Cont.) 1979: Opening of Brooks Brothers stores in Japan. 1989: Partnership agreement with Dickson Concepts to open stores in Hong Kong. 1999: First Brooks Brothers airport store opens at La Guardia Airport, New York. 2001: Partnership agreements in Austria, Switzerland, and Taiwan. 2001: Brooks Brothers expands into golf equipments and accessories.

KEY FACTORS Mission Statement: “ To make and deal only in merchandise of the finest quality, to sell it at a fair profit and to deal with people who seek and appreciate such merchandise.” Brooks Brothers clientele: wealthy families, corporate executives, political leaders, Hollywood celebrities, and sport athletes. Other product lines: Women and kids apparel and clothing. Men’s fragrance, cream shavers, after-shave lotions, and deodorants.

WHY ITALY? MILAN: the capital city of Italian fashion. the most urbanized and cosmopolitan city in Italy. Italy’s financial and cultural center. Presence of may others well-known designers: Armani, Versace, Gucci, D&G, Valentino, etc.

The Italian People Believe that clothing distinguishes people level of power, wealth, and status. Believe it is very important to always be dressed up nicely and well put together in any situation. Rigorously follow fashion trends and styles, and are not afraid of changes. Golf is becoming a popular recreation activity and attracts many wealthy Italians.(Brooks Brothers golf equipments and clothing will certainly profit from this segment).

Italy's Culture

The Italian Lifestyle They love to talk and eat together. Looking fashionable is always a top priority. They always seem to not have a care in the world. Italians have coined the phrase “La Dolce Vita” which means “the Sweet Life”.

The Piazza The piazza is the central meeting place of the Italian culture. There will always be a crowd of people walking, talking and having fun in the piazza. Piazzas are usually the sites for festivals, gatherings and political events.

Italian Fashion One of the largest parts of the Italian lifestyle is fashion. Italians have always considered themselves to be the forerunners of fashion in the world. They are all very proud of their famous designers: Versace, Dolce & Gabbana, Gucci, and Armani

Italian Fashion There is no Italian dress code; but there is a cultural perception of casual attire. Where Americans think about quantity and value, Italians are motivated by quality and durability. Men should wear expensive, sophisticated ties and well-cut dark suits. Men often wear accessories such as cuff links, tie clips, and stylish watches Women are advised to dress simply and with elegance.

Italy's Culture People have to observe how the Italians behave and reason their actions to understand the Italian culture. There are many do’s and don’ts that tourists should have in mind before entering the country. This is crucial for Brooks Brothers, who will experience many obstacles to their entering strategy if they won’t follow the rule of local responsiveness.

Economy 9% unemployment Revenue: 30% industry,65% services GDP per capita: PPP=$25,000

Government President: Carlo Azeglio Part of the European Monetary System Currently stable government It is a Republic

Industry Well known for its’ textiles Many famous designers are from Italy One of the most fashionable places in the world

Business Environment Very Intense Milan is fashion capitol of the world Latest trends Internationally famous Tourist destination Good food, sports & fashion

Brooks Brothers 185 Year old company 2002 recorded $650 Million in sales Niche Look Worn by rich & Famous (JFK) Known for quality and signature look

Competitive Strengths Italians share a fondness for: Quality Fashion Beauty Tailored clothing Impeccably dressed

Weaknesses Fierce competition Tailored needs World famous brands Fitted look Culturally sensitive culture

Market Entry

STORE APPEARANCE 1ST FLOOR: Casual wear, sport clothing, up-beat music targeted at younger clientele. 2nd Floor: Elegant clothing, suits, ties and accessories, soft music targeted at older clientele. Interactive for the customer Sales associate readily available and competent.

Selling Strategy Mix of Push and Pull Strategy. Personal selling to keep in contact to customers. Advertise in sophisticated magazines.

“E-MEASURE” An innovative state-of-the-art technology to make customized clothing. Measurements taken by well trained sales associates Measurements transferred to manufacturing plant instantly. Final product available upon request of method of delivery of customer: Next-day delivery Two-day delivery Standard delivery

Market Entry Strategy Wholly owned subsidiary (Green-field venture) Tight control over our operations Technological know how. Multidomestic Strategy Goal: to achieve maximum local responsiveness Style is different in Italy Customization of clothes to consumer’s taste

Structure Vertical differentiation- decentralized structure Focus on flexibility and control over operations in Italy Horizontal differentiation- Worldwide area structure Focus on local responsiveness