Bargaining power of buyer:

When buyer power is strong, the buyer can essentially set the price. The buyer can easily capture the product with more value by forcing down prices, demanding for better quality or more services. High bargaining power of buyers is when buyers are easily able to switch between suppliers of products required to gain discounts or any additional services.

To counter this Porter suggested : Companies should expand their services.

 Raise the switching costs of buyers. Finding alternate way to reach customers so as to neutralize the powerful channels. Bargaining power of buyer in case of VIMAL SUITINGS : Textile industry is the fastest changing business industry in world. In a textile industry the requirements of customers are in terms of : Size Materials Expensive retail locations in urban areas Globalizing production process

Buyer became powerful during the time of vimal suitings because of the following reasons:

In late 90s reliance focus was changed from textiles to petrochemicals and they were less concerned about their textile division. Marketing myopia, company hasnt foreseen the shift in consumers preferences from suitings to readymade garments. Lack of marketing support. Levels of differentiation vs needs option available well informed buyers ----Internet ---increases bargaining powers of buyer. Cost of Switching. Price sensitivity / Brand loyalty /Substitution.

Vimal was known for its quality and style. Still people remember its simple baseline "Only Vimal". Lack of marketing support had virtually killed the brand. Now the position that Vimal occupied is now owned by Raymonds and Reid & Taylor. REBIRTH OF VIMAL : After a decade, Vimal is making to comeback with a new logo, new product offerings, new stores, a new, focused target customer and a new advertising campaign. REASONS FOR RELAUNCH OF VIMAL :

Indian textile or garment market is expected to grow by 100% in next five years from Rs 95,000 crore to Rs 190,000 crore.

Mens wear market is booming and having Rs 22,000 crore market of which nearly 60 per cent was accounted for by branded apparel. According to Images Technopak, Mens apparel (the largest segment with a 44.9 per cent share) shows a value growth of 12.7 per cent and a volume growth of 4.6 per cent, while the industry as a whole grew by 14.7 and 5.3 per cent, respectively, in 2006. High end technology set up and project management skill of Mukesh dhirubhai Ambani.

There is very tough competition for vimal in relaunch because of various well established players and no. of international brands. -

Indian brands like, Park Avenue from Raymond Madura Garments (Louis Phillipe , Allen Solly, Van Heusen) Arvind Brands (Arrow) Zodiac and Reid & Taylor

Meanwhile, premium international brands like Brioni, Alfred Dunhill and Ermenegildo Zegna have also entered the Indian market.

So , considering the suggestions given by porter to overcome this buyer power we can expect the following changes are made by vimal : DESIGNING: Company hired a famous Italian designer Maurizio Bonas
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to train Indian tailors on the latest in global styles. to launch a special range of premium apparel, Vimal Black.

PRICING STRATEGY: Its very careful in pricing strategy too, so it has created three subbrands that straddle all price points.
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Vimal Red offers basic formal wear for the popular segment (formal shirts for Rs 699-899). Vimal White, which is trendier apparel, is the mid-price range (Rs 799-1,099). Vimal Black is the companys premium offering (Rs 999-1,800).

ADVERTISING & PROMOTION: A 60 second commercial by Grey Worldwide shows the root values of company, Ad shows- a father readying his son to take over his business empire. He picks his own brand Vimal, of course and ends with original theme tune and tagline. First time any textile company showed its machinery etc in ads to boast that vimal fabrics were made in the most modern plant in India.

INNOVATIVE IDEAS : Effective media selection: Sony TV. Only vimal is producing crimped polyester yarn and advanced R&D , with 10,000 designs rated by world bank. Conducting fashion shows. Sales promotion: Miss universe, World cup.