PIsces Group of Singapore
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Transcript of PIsces Group of Singapore
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Pisces Group of Singapore
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Presentation Flow
Evolution of Retail
Case Introduction
Strategy Approach
Strategic alternatives
Conclusion
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Shandy Market Place
Convenient Stores
Discount Stores
Departmental stores
Evolution of Retail
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Small shop in Night market
1970Single
retail store in a shopping
district
1986
Diversified into manufacturing
1989 Established 3 more
stores,deal with Happy
department store
1992
Retail chain with total 16 stores,
75% stake in an optical firm
1993
First large Discount
Store, PMart,
1994
S$ 50billion
Introduction to Case
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Approach• Business • Competitive
Strategic intent• Vision • Mission • Objectives • Goals
Strategic Alternatives• Stability • Growth/Expansion • Retrenchment • Combination
Strategy
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Rivalry
Customers
Suppliers
New Entrants
Substitutes
Cost leadership strategy can be analysed with the help of Porter’s 5 forces model
• Only importer of low cost products from China• No price competitor
• Willing to buy low end and cheap products
• Suppliers from less developed countries manufacturing low cost garments
• Power to bargain stays with Pisces
• Tough market conditions repelled new entrants • Pisces had early mover advantage and was a price leader
• Product prices were itself substitutes for high end products
Business Approach
Strategy Approach
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Expansion or Growth Strategy
Integrated
Horizontal
Verti
cal
Diversified
Concentric
Conglomerate
Extreme Growth
Merger&Acquisition
Strategy Alternative
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Announced an investment of 7.6million dollars in a joint venture with a Singapore firm to set up
a transporting and chartering business
Integrated
Vertical (Backward) integration
In 1993: by the end of 93 opened 16 stores
Horizontal
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• 1993: acquired 75% stake in Kingdom corp. that traded optical frames and glasses(acquisition)
• Sept 1994: 40% in circuit plus and opened new subsidiary as PHT • By the end of the year 1994, expanded its real estate efforts in making
following three hotel investments in China: -S$4.6 million in Zhejiang Province -S$4.9 million to purchase a hotel on Hainan Island from Five Rings; and -S$8 million to purchase 54 per cent of a 400-room hotel on Qingdao Island.
Diversified
Concentric
Conglomerate
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• 1992: Saudi Arabia’s Happy dept. store allowed them to display their goods worth $3m
• 1993: acquired 75% stake in Kingdom corp. that traded optical frames and glasses(acquisition)
• dec 1993: made a joint venture, Q in traces Resource for bilateral trading & investment
• May 1994: second joint venture with 5 ring to be run by Quintraco.
• Aug 1994: Pisces land(subsidiary of Pisces) joint venture with china based Bei Hai port authority to build & operate for 50 years as industrial park in Guangxi province.
Extreme Growth
Mergers & Acquisitions
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Retrenchment
Divestment
• Swapped 30% shares Pisces then signed a preliminary agreement for its third technology acquisition, for 30 per cent of Hongguan Technologies through a share swap
• The links between Pisces and TTI were further strengthened by TTI’s subsequent announcement that it planned to sell to Pisces 10 per cent of its subsidiary garment company, Lu Thai Textiles. The intention was to receive for a stock listing in China
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Why the Growth Strategy?With
developing Singapore night
markets ceased to exist by late 70s.
Need to find an alternative
business, and their relative success in
selling clothes
Capable of higher economies of scale
Great opportunities in
Convenient stores High Customer
Demand (only retailers)
Great margins
Poor economic situation in the home
country
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Conclusion
• Garment being the core competency helped them compensate when pisces group or any other subsidiary faced losses due to economic situations in homeland. This helped them Grow without any concern.
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• Pisces had to be very picky about the businesses they acquire which was hard for them so they conducted market feedback to analyse which firms should they acquire or fund
• Pisces also indicated that it intended to continue its aggressive expansion and faced relatively few constraints. Funding its acquisitions was not a problem, as internal sources, other shareholders, venture capital companies and investors were ‘more than willing’ to fund projects. Instead, the problem was to find suitable acquisitions.
• With the uniqueness in its competitive advantages, both financially well stable and the ability to manufacturing low cost product to meet its customer needs, Pisces is able to implement its business level strategies to custom to its core competencies to generate above average returns.
• The successfully implementation of business strategies include the understanding of their core competencies and will help to sustain their high competitive ranking in the market.
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Thank You!
Presentation By:Vitthal Dhingra