BUS4033 MARKET OF PORTUGAL

Bachelor of Business Administration (Hons)

Human Resource Management (AB 201)

INTERNATIONAL BUSINESS (BUS4033)

SECTION 1

(MARKET ANALYSIS OF PORTUGAL)

Prepared for:

DOCTOR NISRIN ALYANI BINTI ISHAK

Prepared by:

NAME OF STUDENTS ID NUMBER

ROHANI ABDUL HANI AM2001006541

NUR SYAZLINA BINTI SHOHAMI AM2001006605

MARINI BINTI ZAMRI AM2001006511

MUHAMMAD ALIF BIN MUHAMMAD ANUAR AM2001006550

OKAFOR PASCHAL OBIOZOR AF1709003273

Faculty of Business, Accountancy and Social Science (FBASS)

BUS4033 MARKET OF PORTUGAL

Table of Contents

1.0 Introduction market of Portugal .......................................... 1 - 2

2.0 Market analysis of footwear in Portugal ................................... 2

2.1 Market destination………………………………………4 - 5

2.2 Conquering new market ……………………………………5
2.3 Eight years continuous growth……………………………..6
2.4 New job created……………………………………………..6
2.5 Revenue……………………………………………………...7

3.0 Market analysis of clothing in Portugal .................................... 8

3.1 Market segment…………………………………………8 - 9

3.2 Market trend…………………………………………….9 - 10
3.3 Competitors………………………………………………...11
3.4 Aggregate analysis………………………………………...12

4.0 Suggestion and recommendation .......................................... 13

5.0 References ........................................................................... 14

6.0 Appendixes…………………………………………………..15 - 16
BUS4033 MARKET OF PORTUGAL

1.0 INTRODUCTION MARKET OF PORTUGAL

Portugal is a country in southwestern Europe on the Iberian Peninsula. Portugal is

boarded by Spain and the Atlantic Ocean and the government system is republic, the
chief of state is the president, and the head of government is the prime minister.
Portugal has a service-based mixed economy in which the government has privatized
many state-controlled firms and liberalized areas of the economy. Portugal is one of
the oldest countries in Europe with its borders pretty much unchanged since 1927. The
national currency is the euro and Portugal is a developed a high-income country, with a
GDP per capita of 77% of the EU28 average in 2017.

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The statistic shows above is gross domestic product (GDP) per capita in Portugal from
1985 to 2019, with projections up until 2025. GDP is the total value of all goods and
services produced in a country in a year. It is considered to be a very important
indicator of the economic strength of a country and a positive change is an indicator of
economic growth. In this year, which is 2021, the GDP per capita in Portugal amounted
around 28,338.36 in U.S dollars. Gross domestic product of Portugal over the years
from 1985 till 2021 and a projected GDP till 2025 with surgical growth in 2017 toppling
75% of the entire EU GDP, hence this supports the theory that Portugal is a developed
high-income country and that's why we choose to evaluate it further, since it's very
significant in the Entire EU.

2.0 MARKET ANALYSIS OF FOOTWEAR IN PORTUGAL

As one of the most important sectors of the Portuguese economy, the footwear
industry is noted. The Portuguese footwear industry has been truly transformed within
the space of two decades. It has developed from a traditional, labor-intensive industry
into one that is modern, outward-looking and highly competitive, becoming one of the
most important European and global industries exporter. More than 95% of Portugal's
annual production of footwear is exported to more than 150 countries and exports have
risen by more than 50% in less than a decade.

In 2017, Portuguese exports of footwear hit a new historical peak, recording

growth for the eighth consecutive year, with 83.3 billion pairs sold to foreign markets
for a total value of EUR 1.96 billion. This represented a rise in both volume and value of
about 3 percent.

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In recent years, Portuguese businesses have shown great resilience and dynamism
with strong job growth in tandem with the aforementioned: out of just over 32 000
workers in 2010, the footwear industry closed with over 40 000 jobs in 2017. The
industry has witnessed the net development of almost 300 companies over the same
period, thus strengthening its production options. from the market analysis of Portugal
footwear exports, a country that is naturally blessed with leather and textile, with a
40,000jobs in 2017 which saw Portugal export 95% of its annual production which is
like 50% of the entire world imports of footwears, from the graph and the market
analysis one can easily see that the Portuguese footwear market is a good one and a
global success.

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2.1 MARKET DESTINATION

The market destination, Portugal is boarded by Spain (the only European country that
borders the African continent ) with the Mediterranean and the Atlantic ocean and
Portugal been a member of the EU it has access to entire EU countries especially with
the free trade agreement in place, and there is the oceans with its busy ports ,Portugal
had access to other continents,86% of Portuguese footwears are exported all through
Europe while the rest is spread across Asia and several African countries ,hence the
dynamism of the its market destinations. Although European countries continue to be
the key destination for Portuguese exports, most markets have experienced growth in
foreign sales. France, Germany, the Netherlands, Spain, and the UK continued to be
the major destinations for Portuguese footwear.

The Portugal has strengthened its position in most European Union countries, where
its traditional business partners are primarily based, accounting for 86% of its exports
of footwear. The Portuguese footwear industry, though continuing to consolidate its
position in its most important markets, has also ventured into new ones, overcoming
the foreign market limitations and the instability that the global economy has

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dominated. As a result, our goods are becoming important destinations for countries
such as the US, Russia, Canada and Angola.

2.2 CONQUERING NEW MARKET

In order to manufacture their footwear collections, luxury and sports brands such
as Prada, Chanel, Louis Vuitton, Adidas, Birkenstock, Tommy Hilfiger and Paul Smith
use Portuguese companies. But as part of the organization's mission to put 'Made in
Portugal' shoes on the map, Luís Onofre, president of APICCAPS (Portuguese
Footwear, Components, Leather Goods Manufacturers' Association), wants to take the
industry one step further. It's also a goal to support local brands and their global
expansion. And the industry seems to be primed for further growth.

Exports between 2010 and 2017

$125 m

$410 m France
$174 m
Germany
Netherlands
Spain
$218 m
United Kingdom

$376 m

Exports increased by more than 50 percent between 2010 and 2017, reflecting the
industry's efforts to lift the Portuguese footwear profile. The sector’s biggest export
markets are France, where it shipped €410 million worth of shoes in 2017, Germany
(€376 million), the Netherlands (€281 million), Spain (€174 million) and the United
Kingdom (€125 million), but Portugal is also searching for new markets, such as the
United States, the world's largest importer of shoes.

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2.3 EIGHT YEARS OF CONTINUOS GROWTH

Portugal exported 83,3 million pairs of shoes in 2017, worth EUR 1,96 billion,
reflecting a rise of approximately 3 percent compared to the previous year. In terms of
foreign exchange, it's a new historic peak. Portuguese footwear posted its 8th
consecutive year of export growth in 2017. Portugal has shipped footwear to more than
150 countries on all five continents over the past year. Europe, which consumes over
80 percent of exports, is still the largest market. With a growth rate of 2% in the
European Union, Germany (over 11% to EUR 375 million), the Netherlands (over 4.5%
to EUR 281 million) and Denmark (over 4.5% to EUR 281 million) are the highlights
(over 12.9 percent to 107 million euros). Portuguese exports have risen by 7.1 percent
outside the European Union.

2.4 OVER 10,000 NEW JOBS CREATED

About 47 thousand people are now employed by Portuguese footwear firms. The
sector closed in 2010 with 36,985 employees and over 10,179 new jobs have been
generated since then (47.164 in 2016). A related reality relates to job development in
the hinterland. In fact, in the regions where the footwear industry is concentrated (such
as Felgueiras, Guimarães, Oliveira de Azemeís, S. João da Madeira and Santa Maria
da Feira), the lack of skilled workers available has led to the development of more than
a dozen industrial units in the hinterland, such as Castelo de Paiva, Cabeceiras,
Celorico de Basto and Paredes de Coura. The footwear sector has, therefore,
contributed to a greater regional balance.

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2.5 REVENUE

In the footwear market, revenue is expected to hit US$ 2,376 million in 2021. The
market is expected to rise by 2.5 per cent each year (CAGR 2021-2025). The largest
consumer segment will be the Leather Footwear segment, with a market value of US$
1.303 million in 2021.

As the share of the apparel and footwear portfolio is projected to decline just
marginally, leading to tremendous overall growth opportunities, the overall outlook for
the fashion industry remains optimistic. The rising importance of emerging markets,
not only as production sites, but also as consumer markets, is the most important
factor for the global footwear industry. This indicates that producers and retailers have
a strong impetus to diversify their geographical presence in order to allow further
growth. In addition, it is bound to continue the athleisure trend that mixes comfort with
chic and has lifted practical sportswear to coveted fashion statements.

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3.0 MARKET ANALYSIS OF CLOTHING IN PORTUGAL

3.1 MARKET SEGMENT

Market segments are known to react very predictably to an ad plan, program,

or promotion. Market segmentation is the process of splitting a market into
sub-groups in which its members share common features. For instance,
common characteristics of a market category include interests, lifestyle, age,
gender. Geographic, geographic, psychographic, and behavioral are typical
forms of consumer segmentation. One of the most prominent and widely used
kinds of market segmentation is demographic segmentation. This extends to
statistical data on a group of persons, such as age, gender, income, location.
Psychographic segmentation classifies audiences and clients by variables,
such as personality characteristics, beliefs, behaviors, interests, lifestyles, that
correspond to their personalities and characteristics. Although demographic
and psychographic segmentation focuses on who a client is, behavioral
segmentation focuses on the shopping patterns, purchasing habits, consumer
status, brand experiences of the customer. The easiest form of market
segmentation is regional segmentation. It categorizes clients, such as city,
country, radius around a certain area, based on geographic boundaries.

Portugal is the leader of world in high of quality textile, which is in clothing and fabrics
where is make from recycle material and it is one of produce and largest export shoes
and leather in the world. Textile industry is one of the most important sectors and it
important in Portugal economy. Moreover, it has worker more than 130,000 people in 5
thousand company who work in every industry sector of textile and fashion. The level
of the work was increased steadily for years. Furthermore, in this sector have 10% of
the number country exports. This industry was recognized it is because of flexibility,
fast response, knowledge, and innovation. It most consists of from small company and
medium size of the company.

Portugal Clothing & Textile Industry

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With the production 7.5 billion Euro, Portugal textile and clothing are the big country
from among 28 EU member state for 2018. A worthy largely skilled and learned
workforce base is serving the sector growing.

3.2 MARKET TREND

Over a given duration, the perceived trend of market changes. Business

movements refer to all commodities and all markets where prices or quantities
acquired and exchanged are shifting. Trends will provide the opportunity for
investors to prosper. The textiles and clothing sector is a regular sector in
Portugal, but was involved to go through several modern-isms to remain
worldwide competitive. Structural changes were made in order to produce only
high quality increase response times update in design and skill and produce
less commodities and more specified products. This business has the support
of an effective technical and high-tech community, which was specifically
industrialized for the field of non-commodity technical textiles. Currently,
products that are innovative both technologically and in design are reliable for
the increase in Portuguese exportation's and specifically, the growth of GVA
(Gross Value Added) per employee. Even though these progressive
conditions, fabrication is small, and therefore Portugal imports from several
country side, namely the U.S. In 2018, imports.

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This statistic shows the final consumption expenditure of households in Portugal

on clothing, as annual figures from 2008 to 2019. In 2018, spending on clothing in
Portugal amounted to approximately 6.45 billion euros.

This statistic shows the final consumption expenditure for households in Portugal
with regards to household textiles, as annual figures from 2008 to 2019. Between
2018 and 2019, spending on household textiles in Portugal increased by around
73 million euros, from 574 million euros to 647 million euros.

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3.3 COMPETITORS

Europe Textile & Clothing Industry

Have the highest share among of the countries measured. As far as the clothing
industry is believed, only three countries which is Greece, Bulgaria and Romania have
export shares higher than those of Portugal. While for textile, Portugal is the higher
one.

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3.4 AGGREGATE ANALYSIS

The evolution of the share in this sector from the amount manufacturing export is the
same evolution from that GVA and the total of employee. In textile export was
decrease from 19% on 1982 it become 8% on 2006 and the share from clothing export
increase from 11% in 1982 to 16 per cent in 1992, and it decrease to 4% in 2006. From
that, in this time, the industry clothing has large share in the total of employee and the
total of the company but has small in GVA and export from textile.

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4.0 SUGGESTION AND RECOMMENDATION

Marketing is the activity, set of institutions, and processes for creating,

communicating, delivering, and exchanging offerings that have value for customers,
clients, partners, and society at large. Therefore, there are many ways that we can use
in order of promoting our product.

Firstly, create a brand website. The website should be consisting the information
of the product. For the clothing product, the information can be including with the type
of clothes, a clear picture of the product, the material of the product, and many more.
This way can provide an easy way for the customer to approach the product easily. At
the same time, most of the customer does not like to ask the price of the product by
privately message them. From that, the price also should be including on the website
for the reference for the customers. If the customer interest with the product they can
message the seller or directly buy it.

Second suggestion be active on social media. This is a very important way as the
world nowadays most people are active on social media such as Facebook, Twitter,
Snapchat and TikTok. These platforms can be use in order of promoting the product by
actively update about the product daily. As a seller, they also can give a survey
question to customer on updating their feedback upon their product.

Next, sell a look & be a stylist of your fashion brand. Seller can give a review
of all the product where the seller themselves use it and style it. From that, it will
attract more customer based on the knowledge give about how to style the
fashion. Customer will be having a desire to try it, then it will lead to process of
buying.

Lastly, email campaigns. Get the data of the customer and their email.
Every time there is a promotion, notify the customer by email because it will be
easier as nowadays everything works with online. Not everyone loves to go
shopping at the shopping mall, by that it is hard for customer to know the sale or
promotion that are on going at the shop. Emailing customer is an easy step for a
seller so that they will not overlook each one of them.

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5.0 REFERENCES

1. H. Plecher (2021). Gross domestic product (GDP) per capita in Portugal 2025.

Statista of Portugal country.

2. Amin & Jahan Corporation Ltd (2016). Portugal a strong base for textile and

clothing manufacturing in Europe. Textile Today: Driving Business With

Knowledge.

3. Demony, C. M. P. (2020, November 11). Portugal’s shoemaker to survive

pandemic. U.S.

4. Ataide, E. A. (2019, May 20). Portuguese footwear industry rethinks its path to

success. Fashion Network.

5. Statista. (n.d.). Footwear - Portugal | Statista Market Forecast.

6. WorldFootwear. (2017, October 12). The Portuguese footwear industry

7. APICCAPS. (2018, May 10). Facts & number. Https://Www.Apicca

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6.0 APPENDIX

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