UNITED INTERNATIONAL UNIVERSITY

Course Title: Strategic Management (MGT 607)

Assignment: Company profile and Pestel Analysis

of Apex Footwear Ltd.

Submitted To:
Farhana Rashid
Assistant Professor
School of Business & Economics
United International University

Submitted By:
Jahanara Begum ID: 113 152 006,
Mst. Nahida Ahsan ID: 112 161 043

Date of submission: 05-07-2017

Company Profile :
The History of Apex is not very old.Still it is one of the oldest Footwear and Leather Company
in Bangladesh. The company was established in 1990 as a propitorship company at Hazaribagh
in Dhaka. In the very beginning , it used to operate as leather production from rawhide and
exporting. From the year 1993/94,the firm started to deal as forign buyers representative and
leather chemical distributor.

Apex means The Peak or The Zenith. Since 1975 Apex has been striving to live up to its
name.

The journey of Apex Footwear Limited started more than two decades ago, from the inspiration
of leather business & later curving its’ way into shoemaking. As the largest shoemaker in the
subcontinent, this company holds 15% share of leather footwear export in Bangladesh from $1.1
billion leather export. Shoemaking being a highly labor intensive job, this company is a home to
5500 workers mostly women to make stylish leather shoes. Its shoe design inspiration is taken
from latest international footwear trend. The influence is then converted to sophisticated leather
shoes by in-house Italian & Taiwanese designers. Being a footwear giant, its’ an important
responsibility to be a role model in developing people and helping environment. The core values
of Apex is set with the belief of valuing people through continuous development & making a
path for higher achievements.

Apex Adelchi Footwear Limited’s Head Office located at Gulshan-1, Dhaka, Bangladesh and
the production plant is located in Shafipur, Kaliakoir, Gazipur. Apex Adelchi Limited (AAFL) is
a leading manufacturer and exporter of leather footwear from Bangladesh to major shoe retailers
in Western Europe, North America and Japan. The company has revenues of USD 119 million in
2012. AAFL pioneered the export of value added finished 2012. AAFL pioneered the export of
value added finished products export in the leather sector of Bangladesh and is products export
in the leather sector of Bangladesh and is also involved in the local footwear retail business with
the also involved in the local footwear retail business with the second largest shoe retail network
in the country.
 Apex is manufacturing different type shoes, boots, sandals, slippers. All Manufacturing shoes,
boots, sandals, slippers and all kind of footwear; to market globally not for only domestic
market.

Apex Footwear Limited (AFL) is the leading manufacturer and exporter of leather footwear from
Bangladesh to major shoe retailers in Western Europe, North America and Japan. The company
earned revenues of USD 145 million in 2015. AFL pioneered the export of value added finished
products export in the leather sector of Bangladesh and is also involved in the local footwear
retail business with the second largest shoe retail network in the country. Public listed and traded
since 1993, AFL is professionally managed, currently employs over 9,000 persons and is in full
compliance with Corporate Governance Compliance Report under Section 2CC of the Securities
Exchange Commission Notification Order.

Apex is the local manufacturing and retail wing of Apex Footwear Limited. While AFL has
predominantly earned both critical and commercial fame through export of high quality leather
footwear in the international arena, Apex has sought to adeptly make use of that expertise to
provide high quality, fashionable footwear to the Bangladeshi consumers. With over 191 own
retail outlets and 380 authorized resellers, Apex ensures nationwide coverage of its diverse range
of footwear for its consumers. Through its nine in-house brands, namely Venturini, Apex, Sprint,
Maverick, Moochie, Nino Rossi, Sandra Rosa, Twinkler and SchoolSmart and one international
brand i.e. Dr. Mauch - Apex carries a huge selection of shoes, sandals and non-footwear items,
ensuring that each of our valued customer finds the product that is just right for them.

Official Name: APEX FOOTWEAR LIMITED

Type of Company: Public Limited Company

Date of Commencement of Business: January 04, 1990, as APEX FOOTWEAR LIMITED

Stock at a glance
344.2 (0.53%)
Last update: 2017-07-04 11:46:03

Change: 1.8 ( 0.53% )

Open: 345
High: 345
Low: 343
Prev Close: 342.4

VOLUME DETAILS

Volume: 3720
Prev Volume: 0
Volume Change: 3720 (0.00%)
Avg (last 5 days): 9157.4
Cmp to Avg Vol: -5437.4 (-59.38%)

CAPITAL DETAILS

Paidup Capital: 112.5 M

Market Capital: 3872.25 M
Trade % of MCAP: 0.0777%
Public Securities 5020875
Public Cap 736M

SECTOR DETAILS

Sector: Tannery Industries

Sector PE: 25.51
Sector Cap 27098902000.00
Sector Earnings: 1062369066.67
Sector Beta: 0.69

SHARE DRISTRIBUTION

Director: Public: Govt: Inst: Foriegn:

19.42% 44.63% 0% 35.95% 0%

EPS

Last EPS: Quarter: Annu EPS: P/E:

9.36 Q3 12.48 27.58

TRADE DETAILS

Turnover: 1.28 M
Prev Turnover: 0.00 M
No. of Trade: 23
Prev No. of Trade: 0
Avg Trade Value: 0.06 M

BOARD OF DIRECTORS

Syed Manzur Elahi : Chairman

Syed Nasim Manzur : Managing Director
Md. Iftikhar-uz-zaman   : Director (Representing ICB)
Munize Manzur : Director 
Dr.Mohammed Farashuddin : Independent Director
Nihad Kabir : Independent Director

Associate Companies:
  Apex Tannery Limited
 Adelchi Footwear Bangladesh Limited
 Apex Pharma Limited
 Grey Advertising Bangladesh Limited
 Quantum Marketing Research BD Limited
 Mutual Trust Bank limited
 Pioneer Insurance Company Limited
 Gallerie Apex

Vision:
Honest Growth.

Mission:
 To ensure sustainable growth
 To be a vendor of choice for our customer.
 To create value for our shareholders.
 To be proactively complaint with
 Global practices and Standards.
 To be a responsible corporate citizen.

Values:
Demonstrate respect by developing our people and helping them to achieve high performance
standards .Treat all people with dignity.

Objectives:
Manufacturing shoes, boots, sandals, slippers and all Manufacturing shoes, boots, sandals,
slippers and all kind of footwea; to market globally not for domestic market.

Organizational product & features:

Apex products feature:

Women’s Apex Footwear:

 a. Casual:- Mary Janes, Oxford, Stretch, Loafers & Alip, Sandals, Boots, Heels, Clogs.
b. Dress: - Flats, Boots, Stretch, Heels, Sandals.
c. Sandals: - Thong, Slide, Quarter Strap, Gladiator, Flats, Heels.
d. Boots: - Dress, Casual, Equestrian, Waterproof, Barriers.
e. Athletic:- Runner, RX, Apex Runners, Apex Walkers
f. Barriers: - Flats, Boots, Oxfords, Clogs, Zips, Mary Janes, Waterproof, Fur.
g. Lynco Orthotics: - Customizable, Sports, Casual, Dress, Conform,Shearling.

Men’s Apex Footwear:

a. Casual.
b. dressy.
c. Sandals
d. Boots
e. Athlete
f. Lynco Orthoticsf.

Marketing process :
Apex Adelchi Footwear is a B2B company, they do not sell their products directly to the end
user. Their commercial department’s work products directly to the end user. Their commercial
departments work revolves around only selling to and buying from other business. Its main
activities are keeping contact with buyer or seller and preparing main necessary documents
according to the type of the import or export.

Sales Contact:
The buyer and seller located in different countries, concludes a sales contract providing the
payment method and terms of sale. Contract providing the payment method and terms of sale.

Issuing letter of credit:

Revocable and irrevocable L/C.

L/C advising:
The buyers and the sellers are coming from the different countries, so the risk of nob payment is
very high and the authenticity of the letter of credit are becomes a major issue.

L/C Confirmation:
The Janata Bank and Bank Asia are liable to confirm the letter of credit. The Janata Bank and the
Bank Asia take the responsibility to maintain whole procedure of payment guaranty.
Documents Procedure:
 Bill of exchange
 Performa Invoice
 Commercial Invoice
 Packaging list
 Bill of Lading
 Certificate of Origin
 GSP Form
 Export Form
 Amendment Acceptance Certificate

Raw Materials:
They import machinery mainly from Taiwan, China and Germany. from. And they collect
leather from Apex Tannery and also from Pakistan, India China.,

Production Process:
After collecting the raw materials cutting department cuts out the leather. In every section AAFL
have employed experts to look after the work of the worker and improve the efficiency.

Distribution:
Apex finish its product in the production factory to the head office, and then Accounts and
Finance department calculates the cost of the production .After that commercial department start
processing documents to export the products.
Exporting country:
Italy, Germany, France, Japan, Hong Kong, Italy , Austria, Belgium, Denmark, Finland, Ireland,
Greece, Netherland, Austria, Belgium, Norway, Check republic, Portugal, Poland, Romania,
Sweden, Switzerland, Slovenia, Spain, U.K., Canada, U.S.A.

Competitors:
Apex Footwear Ltd.’s main competitors in Bangladesh are BATA, AIMCO Footwear Limited,
Fortuna Shoes Limited, Shampan Shoes Limited, Titas Footwear Bangladesh and Bay
Emporium.
Strength:
AAFL has advanced machines and skilled manpower which make it possible to produce high
quality footwear. As a SBU of Apex group, it also has good financial backup. As a partner
company of Adelchi, Apex gets product designs from them which make it possible for
them to follow Italian fashion trend. They have renowned brand image in the footwear market.

So Apex has-
1. Market leader identity
2. Best quality provider
3. Awesome Packaging design
4. Fast mover advantage
5. Tremendous Distribution channel strategy

Weakness:
AAFL‟s product price is comparatively high. On the other hand, their ladies and kids footwear
brands are not that much strong. Furthermore, they have to depend on foreign suppliers for raw
materials and design support.

 Mixture of difference culture

 Diversified product
 Limitation of offering
 Price structure
 Deficiency of Raw Material.
 Depend on foreign for design support.

Opportunity:
1. Economic growth ( local, national or international )
2. Large potential market
3. Potable for all aged group
4. Easy to collect raw materials
5. Chance to create a new demand
6. Funding sources ( foundations, donors, legislatures)
 7. Legislation (Do new policy or law make company policy harder or easier? )

Threat:
1. Government regulation
2. Shortage of technical person
3. Price war
4. Potential competitor
5. Deflation of money

PESTEL Analysis
A PESTEL analysis is a framework or tool used by marketers to analysis and monitors the
macro-environmental (external marketing environment) factors that have an impact on an
organization. The result of which is used to identify threats and weaknesses which is used in a
SWOT analysis.

PESTEL is a mnemonic which in its expanded form denotes P for Political, E for Economic, S
for Social, T for Technological, L for Legal and E for Environmental. It gives a bird’s eye view
of the whole environment from many different angles that one wants to check and keep a track of
while contemplating on a certain idea/plan.

All the aspects of this technique are crucial for any industry a business might be in. More than
just understanding the market, this framework represents one of the vertebras of the backbone of
strategic management that not only defines what a company should do, but also accounts for an
organization’s goals and the strategies stringed to them.

Political:
Apex has a geopolitical stability in Bangladesh, it has started its operation in Bangladesh in 1990
and over the year and become a market pioneer footwear Industry. However if any changes
happen, it could affect the company directly. In Bangladesh, political turmoil like hartal, strikes
etc. are a serious barrier in the smooth functioning of a company. However, Apex Bangladesh is
able to take some positive outputs from political factors. As they are 100% taxpayers to
Bangladesh government, they must able to make understand the politicians the importance of
FDI in the country. Therefore, Apex Bangladesh can get some benefit from political factor as
well.

 Apex is highest tax payer. Government is giving tax benefit to footwear industry. Apex
will get tax benefit and incentives from government which is declared in 2017-2018
budget.
 Political unrest and Political instability affects the supply of raw materials and
distribution of finished good.
 Poor enforcement of environmental laws and rules.
 Poor enforcement of Copyright, patents / Intellectual property law and corruption will
insecure the company position in legal enforcement matter.
 Lack of strong consumer protection law and laws regarding e-business hamper the
business and relationship with customers.
Recommendation:
 Give sales discount and free samples to influence more sales in the growing shoe market.
 Reduce the price level.
 Reducing the Intermediaries.
 To merge with the local companies and to expand more segmentation.
 Become leader in new product introductions.
 Capture attractive growth opportunities.
 Government should formulate appropriate rules and regulations to support Leather and
leather-based products and footwear sectors. Also should apply strictly intellectual
property law, consumer protection law and e-business law.

Economic:
These factors are determinants of an economy’s performance that directly impacts a company
and have resonating long term effects. [For example] a rise in the inflation rate of any economy
would affect the way companies’ price their products and services. Adding to that, it would
affect the purchasing power of a consumer and change demand/supply models for that economy.
Economic factors include inflation rate, interest rates, foreign exchange rates, economic growth
patterns etc. It also accounts for the FDI (foreign direct investment) depending on certain
specific industries who’re undergoing this analysis.
  Cheap labor
 Local Employee
 Poor Infrastructure
 Unavailability and high cost of power supply
 Currency rates are fluctuating which influence the cost of procurement of raw materials
from external sources.
 Reduce unemployment by creating many sources of employment opportunities for them.
 Inflation rate is 5.39% which is less than the recent year. But in our country inflation rate
is always fluctuant which is causing instable profit and loss situation for the company.
 Local and Foreign Direct Investment create an opportunity in value added leather
products.

Recommendation:
 Ensure that earn per share 15% annually.
 Boost annual return on investment from 15% to 20% within next 5 years.
 Maintain a positive cash flow.
 Increase annual dividends
 To ensure sufficient and continuous power supply.
 Government should plan and built facilities and infrastructure to increase the value
addition through increases production of finished goods

Social and Cultural Factors:

These factors scrutinize the social environment of the market, and gauge determinants like
cultural trends, demographics, population analytics etc.
Lifestyle is changing with the increase in disposable income and more and more people are
becoming quality and fashion conscious. So Apex Bangladesh must have to come out of their old
styling and store design to suit with more modern fashion. Social and cultural indicators are
positive signal for the future prospects of the company.
 Large population
 Change in buying pattern.
 Consumer are becoming more health conscious.
 Despite political turbulence a segment of our middle-class is coming up with reasonable
buying power. Many of them are women who are decision maker so the city store concept of
Apex can attract them as whole of the family footwear can be available there.
 Consumer like differentiated products. They like to shop in a store where they serve the
whole family.
 More competition results in more campaign for products.
 Business expansion in shoe care products
 Utilize outsourcing especially the synergy sources to achieve competitive pricing
 Franchisee opportunity with global brands like Nike, Reebok, Hush Puppy, Bata
 Market expansion opportunity in high fashion & value for money footwear market for all
categories of shoes.

Recommendation:
 More advertisements should be aired.
 Should build awareness among the potential users of this type of footwear product.
 Bring more design, color, and design combination to be competitive.
 Should create more footwear and accessories that are suitable for health conscious consumer.

Technological Factors:
These factors pertain to innovations in technology that may affect the operations of the industry
and the market favorably or unfavorably. This refers to automation, research and development
and the amount of technological awareness that a market possesses.
Due to vast improvements in the information technology systems, ‘Internet’ has posed itself to
be new media to reach the consumers. Realizing the need and the opportunity Apex Bangladesh
has already set a state of the new dimension. They provide new forms of technological
improvement where MIS department monitor their whole operation. The POS system in the
wholesale depot is also a positive step towards good use of technology in the survival and
competition in today’s business.

 Global standards of footwear production

 Best current practices to ensure quality footwear
 Ultra violet dying tunnels, micropak systems and humidity controls in production and
warehouse.
 Update product content and restriction standards including chrome VI, PCP,
Formaldehyde, Lead, VOC testing.
 Apex is accessing newest technology, for example recently they have bought 3D scanner
and software. They are also using high technological qualitative software like
Shoemaster.
 Apex is also spending a good amount in Research and Development.
Recommendation:
 Improved communication system
 Data management and faster decision making.
 Online data access
 Systematic management and information
 Achieve technological superiority
 Should adapt environment friendly technology and machinery.

Legal Factors:
These factors have both external and internal sides. There are certain laws that affect the business
environment in a certain country while there are certain policies that companies maintain for
themselves. Legal analysis takes into account both of these angles and then charts out the
strategies in light of these legislations. For example, consumer laws, safety standards, labor laws
etc.
 Bangladesh Labor Law – complaint with Bangladesh Labor Law Act xiii 2006
 WPPF (workers profit participation fund) 7500 members 5% annual profit share $ 200,000
profit shared I FY 2015.
 Workplace safety – OHS ISO 18000 standard use of personal protective equipment ( PPE)
 Alliance Standard: strict adherence to factory safely and regulation.
 Social Health and Security: group life / health insurance, medical care, safe drinking water,
child care centre, free vaccination.
 Women Empowerment: 80% female participation, sexual harassment policy, equal pay for
equal work, maternity benefit.

Recommendation:
 To provide financial information and report to the top management for decision making
purpose.
 To provide necessary support and help to the computer in their day to day function and to
help data protection.
 To prepare the monthly statement of “Advanced Sale Invoice”.
 Government should monitor and be strict that consumer laws, labor laws, safety standards,
discrimination laws are followed by all the company in the footwear industry.

Environmental:
As a responsible corporate citizen Apex Footwear Limited (AFL) is dedicated to protecting
human, natural resources and the local and global environment following through continued
execution of our environment management system.
Towards this end, it shall strive to:

 Technological Development
  Information and Communication
 Green Category clearance by department of environment.
 Greening of factory premises pollution free environment.
 Moving towards VOC free products in process.
 Should support renewable energy.
 Should use recycling and waste management system to protect environment.
 Should help to protect endangered species.
 Apex should move toward to produce green product or ecological product.

Conclusion:
Apex Footwear Ltd. is a leading edge footwear company in Bangladesh. It is gradually
expanding its performance. Thus it is very important to fulfill the demand of the consumers
through competitive advantage.

References:
http://dspace.bracu.ac.bd/bitstream/handle/10361/1704/08204066.pdf?sequence=20

https://en.wikipedia.org/wiki/SWOT_analysis

http://ctb.ku.edu/en/table-of-contents/assessment/assessing-community-needs-and-
resources/swot-analysis/main

https://www.mindtools.com/pages/article/newTMC_05.htm
http://articles.bplans.com/how-to-perform-swot-analysis/

http://www.stockbangladesh.com/symbols/details2/23619

http://www.textiletoday.com.bd/leather-leather-products-industry-brinks-huge-growth-
possibilities/

http://www.thedailystar.net/business/bangladesh-budget-2017-18-incentive-planned-leather-
industry-1414066

https://www.apexfootwearltd.com/apex_footwear/