This case study analyses the success and the internationalization barriers faced by the Lanidor Group, a leading Portuguese ready-to-wear brand and retailer.
Lanidor initiated its activity in 1966 as a knitwear brand with a core business of thread commercialization, and has evolved since to a “Life Style” concept, which extends beyond apparel.
Lanidor is now the largest chain of feminine ready-to-wear stores in Portugal and is transforming itself into a brand with a strong international presence, with two hundred and thirty-seven stores in twelve countries: two-hundred and seven of which in Portugal, and thirty stores in Spain, Switzerland, Cyprus, Saudi Arabia, Kuwait, Jordan, Angola, Lebanon, Qatar, Ecuador and Mozambique.
In 1999, when Lanidor reached a high level of national market coverage and found that the saturated national market conditioned further expansion of the Lanidor Woman brand, the Spanish market became a priority for them. At the time, Spain seemed to be the natural path for growth, however, the LA Woman brand has been struggling to survive in the competitive neighbouring market.
The Lanidor Group is now considering entry in Poland, but there are diverging views within the management on whether to enter with franchises or with wholly-owned stores.
On the one hand, the view that the best strategy would be through franchising, because it would minimize the investment and risk involved in setting up the international operations and would facilitate a rapid international expansion of the Lanidor Woman brand.
On the other hand, the view that the best strategy would be through wholly owned stores, because franchising in different countries, far apart, could not be effectively controlled and would limit the detection of poor service and management quality, which would ultimately harm the brand‟s image. Expansion through wholly owned stores would be slower, but sounder and Lanidor‟s stores would become the brand image, thus reducing marketing and advertising costs.
This case study illustrates the success story of a national brand and the challenges faced to expand to international markets
