Export-Market-Research-Good-for-Sunday

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Export Marketing Research Written Report Submitted By: Student Name (ID No.) The Business School, Centennial College INTL 725 (SEC 006) Research Methods for Trade and Development Professor July 21, 2023

EXPORT MARKET RESEARCH Company Name: Good for Sunday - Apparel Company This exploratory market research report was provided for Good for Sunday to help them identify the best market once they expand their business in another country. Specifically, this paper provides extensive research and recommendations for Good for Sunday, an eco-friendly retail clothing chain store located in Canada that prioritizes sustainable practices, about their export products and the potential of Japan as the chosen market for its expansion. I. The Product Good for Sunday is a retail clothing chain store located in Canada that prioritizes sustainable practices. It does not come at the expense of the environment or the infringement of human rights in any way. It is focused solely on creating ethical clothing products that are timeless and effortless in nature. Its eco-friendly and sustainable clothing line includes hosiery and socks, shirts, sweaters, undergarments, pants, and cut-and-sew clothes such as dresses, suits, shirts, and trousers. It also makes soft, wearable garments from organic cotton, linen, and bamboo (Good for Sunday, 2023). Demand Since Canada's fashion industry has a history of excess and unsustainable methods, the increasing demand for eco-friendly clothing products is a major development. Recently, there has been a growing sustainable clothing movement to create clothes that are good for the planet, society, and business. As a result of the widespread adoption of sustainable business procedures by Canadian fashion designers and companies, the country has emerged as one of the world's foremost pioneers in the fashion industry. Consumer demand, cutting-edge materials, and forward-thinking corporate strategies are propelling the Canadian sustainable fashion sector. Collaborations and technological advances help put Canadian firms at the forefront of the environmental movement. Greening Canadian fashion includes the use of eco-friendly textiles as well as circular production techniques that promote reuse and recycling. Additionally, sustainable fashion events have become more prevalent, resulting in great attention from customers, business professionals, and media outlets. These events highlight the most recent trends in environmentally friendly apparel, accessories, and shoes designed by influential designers from across the nation (Wong, 2023). According to Gitnux (2023), the percentage of the global apparel market share that comprises sustainable clothing products is anticipated to rise from 3.9% in 2023 to 6.1%

in 2026. Sustainable apparel is becoming more in demand as the sustainable fashion industry experiences rapid growth. This suggests that the sector of sustainable fashion is getting more profitable and that an increasing number of individuals are becoming aware of the significance of sustainable fashion. This is advantageous to the environment as well as the apparel industry as a whole. Specifically, in Japan, consumer demand for sustainable goods is rapidly expanding due to consumers' growing interest in environmentally friendly clothes and their consideration of sustainable products before making purchases. Price Trends Price is the primary factor preventing consumers from purchasing more eco- friendly goods. When it comes time to make a purchase, the price typically outweighs other considerations, even though consumers claim they value sustainability and want to show their support for sustainable products (Canaves, 2022). The idea that sustainable fashion is reserved for a wealthier audience is perpetuated by the fact that the price of a garment that was made sustainably is frequently substantially higher when compared to an off-the-rack item that was mass-manufactured. However, there are several factors that go into making sure that every piece of clothing manufactured has a negligible effect on the environment. Firstly, a garment that has been produced sustainably and is reasonably priced shows a company's commitment to minimizing its negative effects on the environment and the people who manufacture it. In the backdrop of fast fashion, which has conditioned a new generation of consumers to demand low costs on virtually everything, sustainable fashion may appear pricey. In addition, the pricing of items made from sustainable materials begins with the raw resources. The price of materials made from natural fibers, such as silk, is typically higher than those made from practically plastic polyester blends. The type of raw materials, the location from where the raw materials were obtained, the manner in which and the location at which the product is manufactured, as well as who manufactures the product and under what conditions, are all elements that could have an effect on the pricing (Khatib, 2022). Consumer Purchasing Trends The survey conducted by Canaves (2022) has shown consumer purchasing trends for sustainable clothing items. The findings show that customers in the later stages of the millennial and Gen X generations have the lowest levels of willingness to pay a higher price for sustainable fashion. On the other hand, younger consumers or members of Gen Z are more willing to pay more for sustainable clothing. Another factor for eco-friendly

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clothing is that its target market of environmentally conscious customers tends to buy more of everything. The demand from customers is primarily what is driving the present movement toward more sustainable practices in the fashion sector. People are becoming more conscious of the negative effects that fast fashion has on the environment and society, and as a result, they are looking for alternatives that put value on ethical production and minimize waste. This has resulted in the development of a rising movement known as slow fashion, which places emphasis on quality rather than quantity and encourages customers to make purchases with a value retained over time. Because of this, many companies, such as Good for Sunday, are starting to make use of environmentally friendly business procedures as a means of satisfying the ever-increasing customer demand (Wong, 2023). II. The Competition / Competitive Intelligence The apparel industry in Canada is enormous, and the country is also home to some of the most well-known clothing companies in the world. The apparel industry is a highly competitive and dynamic sector that consistently adapts to new trends and consumer preferences. The market is quite large and consists of over 2,000 different companies. There are very few barriers to entry in terms of government regulations, and the apparel sector in the country has been very welcoming to new competitors. The majority of the clothing companies in Canada are held by Canadian citizens, with only 2% of the businesses being owned by individuals or organizations located outside of Canada. Multinational corporations control most of these businesses with foreign ownership, with their headquarters in the United States. Large-scale production of items like jeans, undergarments, and fundamental clothing is a primary focus for these global conglomerates. Toronto, one of the most important cities in Canada, has carved out a special place for itself in the apparel sector. Companies from the United States, Mexico, Japan, and other countries have shown trust in Toronto's apparel manufacturers. The clothing produced by Toronto manufacturers is guaranteed to be of high quality, with a rapid turnaround time, in addition to flexible catering and dependable services (Smith, 2022). In addition, the apparel sector in Canada is seeing rapid expansion, yet, it is hampered by a number of challenges, such as a lack of qualified labor in many cities and the relocation and shifting of major companies to countries with more developed economies. Moving to such countries presents cost-effective possibilities, such as lower manufacturing expenses cost and a cheaper labor workforce, all of which are key business platforms for clothing businesses that want to sustain and thrive in a global market that is seeing increased levels of cutthroat competition. As a result of increases in the cost of

production, many of the manufacturing units have relocated their headquarters outside of Canada. The export market for Canadian apparel companies is expanding, and many countries, such as Japan, depend on the Canadian apparel industry. Thus, some of the main competitors that Good for Sunday competes with are Tentree and Kotn (Wong, 2023). SWOT Analysis of Main Competitors A. Tentree Strengths Weaknesses ● Unique business model ● Strong brand loyalty ● Operates in mature market with steady sales ● High-quality sustainable clothing products ● Affordable price ● Effective online marketing strategies (Maierhoffer, 2023) ● Narrow product line ● Only sold in few countries ● Lower than industry standard gross margin ● Higher COGS to compensate their business model (Maierhoffer, 2023) Opportunities Threats ● Global expansion in growing markets ● Exploring innovative promotional strategies ● Improving the online store ● Develop innovative product diversity ● International competitors’ global expansion ● Sustainability in market crisis ● Low barrier to entry ● New company trying to gain market share (Maierhoffer, 2023) B. Kotn Strengths Weaknesses

● High-quality sustainable clothing products ● Strong brand loyalty ● Certified B Corporation voted Best for the World, with the fourth- highest B Impact Score of apparel brands in North America ● Strong corporate social responsibilities ● Reasonable prices (Kotn, 2023) ● Poor online customer service ● No branch in other countries ● Limited market ● Inability to respond to trends rapidly (DeAcetis, 2021) Opportunities Threats ● Global expansion in growing markets ● Exploring innovative promotional strategies ● Improving the online store ● Develop innovative product diversity ● Intense competition ● Rising operating costs ● Changing fashion preferences ● Low barrier to entry (DeAcetis, 2021). III. The Market / Market and Customer Intelligence Demographics and Potential Market Size/Scope The demographic that Good for Sunday aims for in Japan is much more diverse than just "environmentally conscious" consumers; it comprises people of all ages and socioeconomic backgrounds. The company can identify the target market for sustainable apparel using the following broad market segments. Firstly, sustainable fashion is most likely to appeal to those who are environmentally conscious, value the preservation of natural resources, and seek opportunities to integrate eco-friendly practices into all facets of their lives (Good for Sunday, 2023). As more people become aware of the harm caused by the fast fashion business, this group grows significantly. The lack of awareness that was formerly a fundamental hurdle for this target demographic is no longer an issue because of the increased media presence and promotion of sustainable fashion. Additionally, consumers who want to support ethical and sustainable company practices are prepared to spend a little bit extra for apparel that was produced without harming the environment or exploiting employees. They are also interested in helping firms strive toward a more sustainable future and attempting to make a difference in the world. If such individuals are aware that particular clothes are made with material that has been recycled, there is a much better chance that they will purchase those clothes. People who favor organic products are another target audience. There is a growing movement of people

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who are interested in adopting an organic way of life, and for many of these individuals, the concept of sustainable fashion is equivalent to organic clothing. People who only wish to consume goods manufactured from organic materials and have not been treated with hazardous chemicals make up this target market. If organic clothing is also totally biodegradable, then it is an additional selling point for this sector of the market. As a result of the growing demand, a growing number of well-known fashion manufacturers are beginning to produce sustainable clothing lines (Hilton, 2022). Operations and Ease of Doing Business In terms of ease of doing business, Japan has enacted a number of reforms meant to make the country more business-friendly and entice foreign investment. The goals of these initiatives have been to improve investor security, decrease the time and money required to launch a business, and streamline the administrative processes involved in doing so. Contract enforcement and bankruptcy issues have also seen improvement in the country. According to the World Economics report, Japan is ranked number 29 out of 150 countries for how easy it is to start and run a business there. The index measuring how easy it is to do business in Japan is 84.1. The country has an efficient logistical system, a well- developed infrastructure, and a labor force that has received extensive training. When going through the difficult and time-consuming procedure of starting a company in Japan, it is recommended that foreign investors seek the assistance of local professionals (Lanvin & Monteiro, 2021). The operations in the clothing industry toward sustainability are mostly driven by consumer demand. People are becoming more conscious of the negative effects that fast fashion has on the environment and society, and as a result, they are looking for alternatives that put value on ethical production and minimize waste. This has led to a slow fashion movement, which places a value on quality rather than quantity and encourages customers to make purchases that will retain their value over time. In light of this growing need, an increasing number of well-known companies are embracing sustainable methods of doing business (Wong, 2023). Political and Geographical Stability Japan's political system is stable and consists of a parliamentary democracy with a constitutional monarchy. It has a robust democratic system and an environment that is conducive to political stability, both of which are attributes of the country. In addition to being a member of the United Nations, it is well-known for its political steadiness. Because

of its well-deserved reputation for peace and tranquility, the nation is a desirable site for businesses that have their sights set on expanding into international markets. However, there are occasional confrontations with neighboring countries that have the potential to influence the political atmosphere in the region (Miura, 2019). Japan is located in East Asia and comprises a string of islands along the Ring of Fire in the Pacific. Despite its location in a seismically active region and susceptibility to natural disasters, the country has developed sophisticated infrastructure and disaster preparedness measures to mitigate the effects of such occurrences. The country’s transportation infrastructure, which includes roads, railways, and airports, is highly efficient and well-maintained. Additionally, it has a dependable supply of utilities such as electricity, water, and communications. On top of that, Japan has a low crime rate and a strong commitment to public safety. The nation is renowned for its clean, well-organized cities, efficient public services, and high standard of living. Currency Risk In terms of the risk associated with different currencies, the Japanese yen is a stable currency that has remained relatively unchanged throughout the course of time. However, shifts in the value of foreign currencies on the market may affect the yen's value, which poses a risk of currency fluctuation for overseas enterprises conducting business in Japan. Currency hedging tactics are an option that the Canadian corporation may incorporate to mitigate this risk (Hogan, 2021). Trade Relationship with Canada Canada is the third-largest import provider to Japan, and the two nations continue to have strong business connections. The Japanese market is one of Canada's most important export markets, and doing business there opens up various opportunities. As a result of the fact that both countries are partners in the Trans-Pacific Partnership (TPP), the economic ties between them have become significantly stronger (Global Affairs Canada, 2020). IV. Conclusion and Recommendations People are starting to realize the potential for the fashion business to harm the environment. As a result, more and more individuals are drawn to purchasing sustainable fashion. Individuals concerned about the environment make up the sustainable fashion industry's target market.

Because of its secure political environment, highly skilled labor force, and advanced facilities, Japan is an attractive site for Good for Sunday who desire to expand their operations around the globe. Even though launching a business in Japan can be tough and time-consuming, the expertise of local professionals can help ease some of these challenges. Good for Sunday should incorporate the available currency hedging opportunities to cut its exposure to currency risk. With such a strong commercial relationship, Canada has a better chance of success in the Japanese market. As a result, the company would be well to give some serious consideration to the idea of expanding its operations overseas, notably to Japan. Further, for Good for Sunday to establish a sustainable business operation, the company must ensure that it is financially viable to fund its strategies for exporting and expanding the business. Likewise, Good for Sunday should be aware of the forces and formulate ways to respond to them in order to be successful. This may include making investments in e-commerce, cultivating solid connections with suppliers, and focusing on producing sustainable and environmentally beneficial products.

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Bibliography Canaves , S. (2022). Higher prices are affecting consumers’ willingness to buy sustainably. Insider Intelligence. https://www.insiderintelligence.com/content/higher-prices-affecting- consumers-willingness-buy-sustainably DeAcetis, J. (2021). How Kotn Is Solving Problems In Apparel and Illiteracy. Forbes. https://www.google.com/amp/s/www.forbes.com/sites/josephdeacetis/2018/04/12/how- kotn-is-solving-problems-in-apparel-and-illiteracy/amp/ Gitnux. (2023, March 10). Sustainable Fashion 2023: A Look at the Industry’s Impactful Statistics • GITNUX. https://blog.gitnux.com/sustainable-fashion-industry- statistics/#:~:text=and%20its%20stakeholders.- Global Affairs Canada. (2020, May 20). Canada-Japan relations. GAC. https://www.international.gc.ca/country-pays/japan-japon/relations.aspx?lang=eng Good for Sunday. (2023). Good For Sunday – Made in Canada clothing & loungewear. Good for Sunday. https://goodforsunday.com/?gclid=CjwKCAjwtuOlBhBREiwA7agf1nDqQkWg7ornrYW smuYhJAsv3DVD539OhGCuGGI8TxOxe_HxOXt7UBoCgaUQAvD_BwE Good for Sunday. (2023). Good for Sunday - Sustainability Rating - Good On You. Directory.goodonyou.eco. https://directory.goodonyou.eco/brand/good-for-sunday Hilton, D. (2022, March 10). Understanding the Target Market for Sustainable Fashion | AMPLIFY XL. Amplifyxl.com. https://amplifyxl.com/target-market-for-sustainable- fashion/ Hogan, G. (2021, August 23). Volatility in the Yen Has Changed Manufacturing. Investopedia. https://www.investopedia.com/articles/investing/051515/impact-exchange-rates-japans- economy.asp Khatib, H. (2022). What goes into the pricing of sustainable fashion? Vogue India. https://www.vogue.in/fashion/content/why-is-sustainable-fashion-expensive-the-cost-of- ethically-produced-garments/amp Kotn. (2023). About Kotn. Kotn. https://kotn.com/about Lanvin, B., & Monteiro, F. (2021). The Global Talent Competitiveness Index 2021 Talent Competitiveness in Times of COVID. https://www.insead.edu/sites/default/files/assets/dept/fr/gtci/GTCI-2021-Report.pdf

Miura, L. (2019, September 27). What’s behind Japan’s political stability? The Japan Times. https://www.japantimes.co.jp/opinion/2019/09/27/commentary/japan-commentary/whats- behind-japans-political-stability/ Maierhoffer, J. (2023). Ten tree International. Prezi.com. https://prezi.com/yq0vyak_wvr0/ten- tree-international/ Smith, P. (2022). Apparel Industry of Canada | Canadian Textile Sector. https://www.fibre2fashion.com/industry-article/7394/canada-wrapping-the-world-in- style?amp=true Wong, B. (2023). Sustainable Fashion In Canada: How The Industry Is Changing. Torontodressforsuccess.org. https://www.torontodressforsuccess.org/sustainable-fashion- in-canada

Export-Market-Research-Good-for-Sunday

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