Teo
Guan Lee Apparel is one of the garment manufacturers targeting specifically for
the young children clothing. With such a special niche, the company has no doubt
able to differentiate themselves among the already crowded industry. Leveraging
on its niche position, TGL can easily penetrate into the nationwide departmental
stores at there are not much competitors around. In other words, they
distribution network covers quite a big coverage where it can almost be found
anywhere as long as there is departmental stores within the area. Another point
about children apparel is that trend preference is not highly sought as
children has not much demand in terms of apparel. Therefore, problematic
inventory issues will not bother the manufacturer much. At the same time, size
is also not much concern as one particular size is able to suit several children
body size with a range of ages which is cost saving.
As
attractive as it sound, downturns of such a niche market must also be expected.
First of all, most children is not obsess with fashion at all. Therefore,
demand only present when their guardians or parents do the purchases and
selections for them particularly only during festivals. Unlike adults’ apparel,
a series of combination and varieties are highly sought to meet several occasions.
Another problem is that, in order to meet children’s demand for their favourite
character to be displayed on their clothing, the company need to pay for the
trademarks to realize the demand. As animated character is always updating and
will come up with a new one, constant expenditure on “borrowing” the “character
image” is quite costly to the company itself. When we look at the demographic
breakdowns of Malaysia, family planning is starting to get popular as more and
more couples are filled up with their respective career and at the same time to
meet their stringent budget in the midst of fierce inflation.
Although
it is quite beneficial as to its current monopolistic position, future prospect
is dim with the stated problems. Filtered.
Stock: TGL Code: 9369
