Shenzhou International Group: Sustaining Success

Since its founding in 1990, Shenzhou International Group Holdings Limited evolved from a small clothing manufacturer to a world-leading apparel supplier, serving well-known sports and leisure brands such as Uniqlo, Nike, Adidas, and Puma. Over the previous 10 years, the group experienced explosive growth. Yet, in an age of increasing consumer expectations, could it rely on existing models to achieve greater success? Comments made by the US president about reviving his country’s manufacturing industry encouraged many firms to invest in building factories in the United States. Despite being a traditional labour-intensive manufacturer, the company wondered if it should consider setting up a factory in the United States as part of its future strategic plans. If so, would the challenges outweigh the opportunities?

This case is designed for graduate and post-graduate students, and can be used to discuss problems related to competitive advantages, strategic choices, and brand building in courses such as strategy management, international commerce, and global operations, as well as custom executive training courses for the textile and apparel industry. The main objective is to discuss how companies can develop core competencies and select internationalization and diversification strategies. After completion of this case, students will be able to<ul><li>discuss the competitive advantages of Shenzhou International and gain an understanding of how a company gains and maintains its competitive advantages;</li><li>compare and analyze the difference between establishing factories in Cambodia and Vietnam versus in the United States, and discuss the latter in terms of corporate development and the macroeconomic environment; and</li><li>analyze the competitive landscape of the textile and apparel industry, and make suggestions about the group’s diversification strategies and brand.</li></ul>

• Internationalization, Business Partnerships, OEM, Textile and Apparel Industry, Growth Strategy