Name : Dor Biran ID : 302849997 Business Communications – Final Project Benetton Group When Israel was first established

, its main thriving local businesses were comprised of food and textile. My grandfather owned a textile factory, but with the rise of globalization, and the Far East countries becoming the primary setting for manufacturing garments, he had to shut down his factory. He was still young and stayed very connected to the industry, so he decided to buy and develop the Benetton franchise in Israel and in Poland. I will present the story of this company from that day until the day the last store had been sold. Company Profile The Benetton Group whose core business is fashion apparel has branches in 120 countries around the world. A group with a strong Italian character whose style, quality and passion are clearly seen in its brands; the casual 'United Colors of Benetton', the glamour oriented 'Sisley', and 'Playlife' American college style. The Group produces over 150 million garments every year. Its network of over 6,400 contemporary stores around the world offers high quality customer services and generates a total turnover of over 2 billion euro. (Benetton Financial Reports, 2011) Israel Branch Background Benetton Israel wasn't my grandfather idea, a company named "Rasko" imported the brand and opened the first ever Benetton store in the Dizingoff Center mall in Tel Aviv. My grandfather, who was looking for new direction in his business life, heard that "Rasko" are looking to sell the franchise. Based on the success of the brand in Europe and the lack of worldwide brands in Israel, in 1986 he decided to buy the franchise and start its development.



Final Project

the clothes weren't made for Israel’s weather and a significant part of the summer collection was irrelevant to the Israeli market. Walker. Since Israel’s fashion lacked a range of worldwide brands. the fashion country. who now had the quality and the variety of colors Benetton offered that was never before seen in the streets of Tel Aviv. which displayed new trends for the fashion industry. People outside of the bubble of Tel Aviv might not buy these high quality high-price garments and other companies might try to eat part of the success cake. clothes) and to try to mimic them. Opportunities and Threats The opportunities were clear. Danielle Medina. and cultural isolation is less of an option" (Brake. The Israeli market lacked worldwide brands and the demand for fresh garments from Italy. In addition. There were a few threats for getting started. and were sold in relatively high prices. 2|Business Communication Final Project . so the prospects for expansion were great. and their financial reports got better by the second. as is in any business. 1995) The mid 80's were symbolized by the beginning of globalization. this was specifically great for the Israeli consumer. Although there was a demand for new and world known brands. What made Benetton unique were was the variety of colors they offered and the high quality of their garments. stores opened all around the world. climaxed. There was only one store. and Thomas Walker. Terence. TV. Tax authorities can suddenly decide to raise the tax rates. The Beginning "New Communication technologies bring multiple cultures to the young. The arrival of the cable TV caused the Israeli youngsters to get exposed to American culture (music.SWOT Analysis Strengths and Weaknesses Benetton reached its peak in the mid 80's. Italy-made clothes were not cheap.

with huge round glass display windows. The huge success in little Israel made the headquarters in Italy offer the Polish franchise to my grandfather. Stores popped in every major city. The combination of the variety of colors and European quality was new to Israeli buyer and succeeded all over Israel and around the world. Sales were great. At that point. won the Israeli crowd. Furthermore. 3|Business Communication Final Project . totaling of 17 stores throughout Israel. Globalization took an even greater part in the textile industry. was the issuance of the company in the Israeli stock market. Benetton opened a store in the first mall in Israel. did magic. in both countries. The Downturn The mid 90's were characterized by the growth of the shopping habits of the Israeli consumer. Benetton was one of the biggest and most prestigious clothing stores in Israel. When Benetton headquarters asked to change their policies to match the new shopping culture. they refused. the company was able to raise 3 million dollars and got the boost to keep getting larger. "Ayalon mall" in Ramat-Gan. Benetton. He accepted and began the work in both countries and continued succeeding in achieving high profits. Benetton conquered the fashion industry. and a method of changing their collections every few weeks. Benetton had three stores. The entrance of the Spanish brands and their possibility of offering the same looking clothes in prices Benetton couldn't compete with. the Dizingoff Center mall. in the best location in Tel Aviv. the success of the brand induced new and developing malls to contact Benetton and ask them to open a store in a prime location in their mall. At one point. The demand for “foreign look” clothes was high as the expectations. Another aspect of the success.The worldwide name. In 1991. the flagship store being 250 m.

Danielle Medina. and Thomas Walker. 1995) This battle was determined from its beginning. listen. "Companies that are paying attention to culture are seeing the results on their bottom lines. Unfortunately. which need grounding in cultural knowledge for translation into cross-cultural skills. Terence. The Israeli buyer. Walker. stereotypes tend to lock us into well-worn channels of perception. world widely. (Benetton group's stock between the years 1992-1996. as part of a worldwide phenomenon. and Thomas Walker. Walker. Benetton. It is an economic necessity. Cultural competence is no longer a nice skill to have. and have the flexibility to adapt. including the ones in "We always need to pay attention. Worldwide stores." (Brake. The Italian headquarters were stubborn and refused to adapt to the new consumption habits. Danielle Medina. Cultural competence begins with open attitudes. observe. changed his mind from quality to quantity. Benetton. which facilitate the development of self. felt the downfall and decline in profits. Terence.and other-awareness.The options that the Israeli buyer was exposed to changed the Israeli consumption culture. 1995) 4|Business Communication Final Project . were closed since it wasn't profitable to keep holding the franchise." (Brake.

From building a plant to manufacture and being one of the biggest exporters in Israel. when he saw that the company had no future. The Israeli market was seeking new and fashionable clothes. that will write a paper in his business degree about his grandfather's achievement. The skill to understand the culture and to be able to do great things with it is the greatness of this tale. My grandfather showed great skills to be at the right place at the right time. but his requests got refused. the Polish market still operated well and he was centered on keeping the profits there. At that point. The final step. When the culture made its next development in the 90's. Proud to write it. buying and selling Benetton. maybe my grandchild. Biran Dor 5|Business Communication Final Project . which got them even more advertisement. and in many years I will have someone. I hope to embrace this skill and that this is only the beginning of the story. and Benetton catered their needs perfectly. he sold the few stores that were left and the franchise. The identification of the state of the market and their need for a world-known brand was brilliant. Shops were starting to lose money and some had to be closed. The marketing Benetton used all around the world displayed themes that Israelis had never seen. My grandfather asked. then advancing to become one of the biggest importers from China and Hong Kong and finally. and it is known that there is no such thing as bad publicity. The conservatives tried to censor the ads.Conclusion The expose of the Israeli culture in the mid 80's to American and European cultures made the import of the world-known brand of Benetton into a big success. a change needed to be made.

Earley. Walker. New York: McGraw Hill. and Elaine Mosakowski. 6|Business Communication Final Project .Bibliography 1. 1995. Christopher. "Benetton Israel . 4. Rep. "Success in Understanding Calture.benetton. P.Interview with the CEO. 2011. 2." Doing Business Internationally: the Guide to Crosscultural Success. "Cultural Intelligence. Danielle Medina. 3. Web. <http://www. Menachem. Brake. 28 May 2011. and Thomas Walker. Terence." Harvard Business Review. Ben Dov. October (2004):>. Web. Print. 72-75. United Colors of Benetton." Personal interview.

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