United Colors of Benetton Case Study Example | Topics and Well Written Essays - 1000 words

United Colors of Benetton - Case Study Example These are special skills on product design and manufacturing procedures related to cutting and dying. Still, their networking or outsourcing activities remain in the confines of their territory in Italy. Contrary to the prevailing business models in their industry at the given period, even their retail shops are outsourced in the form of informal licensing. By informal it means that most of their transactions whether in manufacturing or retailing are based on handshakes mostly with no written or formal agreements. Conversely, their major competitors Gap and Zara own and control their retail shops. It is estimated that about 85% of business operations are outsourced. Their vast networking strategy paved the way for their tremendous growth not only in Italy but in other countries as well. These licensees played a significant role through financing other aspects of Benetton operations hence allowing the latter to focus their hard work and resources to their core competencies. The embodiment of its strategic outsourcing initiative is evidently shown in its five-stage process for its international expansion. The gauge of their successful expansion must result to buy out of their licensee or subsidiary and integrating it under Benetton management.