Geox in FranceBest in France Case Study

13th December 2005 By Christian Brands and Robert Relph

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Executive Overview

• Company Overview• Products• Clients• Why did Geox come to France?• French Values• Constraints in France• Key Benefits of doing business in France• How to adapt to France• Essential Advice• Credits

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Geox Overview

• Founded in 1990, entering France in 1997• Footwear retailer in 68 countries.• Patented technology delivers comfort and

health benefits.• Net revenues 2004: €340.1M , EBIT €72.6M,

mostly generated outside Italy.• Leading footwear brand in Italy and 4th in

the world (Source: Shoeintelligence)

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Products

• Product manufactured in Eastern Europe, Asia and South America– Geox Plants (20% of production)– Outsourced operations (80% of production)

– Not made in developed countries due to labour costs

– Materials bought in Italy

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Kids

Women

Men

Clients

• In France balanced customer make-up

• 322 stores selling Geox exclusively worldwide

• Target Customer: Medium-High Income and well educated

• Customer profile in France is similar to other countries

• Expectations of comfort and quality

French Client Make-up

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Why did Geox come to France?

• Part of international expansion plan• Association with fashion• 2 companies

– Geox Retail France– Geox France Sarl.

• Great consumer potential• Sees France solely as a sales country

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French Values

• Established a sales team in France to understand the ‘French culture’

• Integrated people into the country to gain a greater market understanding

• Only hired people who are convinced of Geox’s values– Staff Training

• Geox feel this integration approach has been successful

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Constraints in France

• HR Costs comparable to those of other European countries

• No particular organizational structure costs

• Some language and infrastructure (network) costs– Size of the country makes effective distribution difficult

• Geox was aware of the French culture before starting business activities

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Key Benefits

• Great Consumer potential– Very positive feedback from current consumers

– Mono brand & franchise expansion• Very high rate of productivity per employee

• Government assistance: Italian side• Image benefit: Being present in Paris• General Impression: Very satisfied with the French market

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Adapting to France

• People Management system:– Recruitment: French employees– Compensation: base salary plus commission based on percentage of sales

– Workforce planning: no current expansion – Motivation: Convince employees of the Geox culture

– Training done through schemes & material developed in the head office

• Infrastructure issues• Not a step-change: same currency & similar culture

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Geox’s Essential Advice

• Not specifically for France, however:– Need significant up front investment– Need good people, particularly good sales people

– Need to communicate benefits to the customer

– Inevitable: understanding the culture

These were simple but key factors

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With thanks to

• Eros Scattolin, International Communications ManagerGEOX S.p.A. Via Feltrina Centro 16, 31030 Biadene di Montebelluna (TV) - Italia. eros.scattolin@geox.com+39 0423 282541

• Luciano Santel, Chief Financial Officer GEOX S.p.A. Via Feltrina Centro 16, 31030 Biadene di Montebelluna (TV) - Italia. luciano.santel@geox.com

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Bibliography

• www.geox.biz• Amadeus Company Database• Geox 2004 Company report• Interviews with Geox Executives• Dickey, C. (2005) Your Sole Provider, Newsweek, 01/10/2005, Vol. 145, Issue 2, p60-60.

• Anonymous (2004) The Ferrari of footwear, Economist, 03/13/2004, Vol. 370, Issue 8366, p65.

• Hoppough, S (2004) Flat-Footed, Forbes, 11/29/2004, Vol. 174, Issue 11, p82-84

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Additional Information

• For questionnaire and transcription see supplementary documents

• Team Details:Robert RelphWychwood, Rectory Meadow, Litcham, Norfolk PE32 2NR, United Kingdomr.relph@lancs.ac.uk

Christian BrandsRoggenweg 1850933 CologneGermany christianbrands@hotmail.com

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End

Thank you very much for your attention!