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Wednesday, May 28, 2008

Cheetah Corporation (M) Sdn Bhd


During the eighties, Malaysia was the forth largest manufacturing export contributor of apparel. However, the industry had shown declining trends during the nineties as the government switched their focus towards the electronic and electrical industry and was prevailed by China, Bangladesh, Sri Lanka, Pakistan, Indonesia and Vietnam due to lower production cost, and cheap and longer hours labour. Between year 1999 and 2000, the industry showed the slowest growth rate with only an average growth of 1.2% per annum (The Malaysian Institute of Economic Research n.d.). The industry was the sixth largest manufacturing contributor in year 2006 (Malaysia Textile and Apparel Industry 2007). The dominants of the manufacturing apparel would be Padini Holdings and Hing Yiap Knitting Industries Berhad. Currently, success local brands such as Padini, Miki, P&Co., Vinci, Seed, Rope, La Primavera and Monaco show potential growth in this industry (The Malaysian Institute of Economic Research n.d.). As reported on 7th February 2007, Malaysia had outweighed United States by exporting $743 million’s worth of apparel to United States as United States had only exported $24.5 million into Malaysia (Apparel groups push for Malaysia trade pact 2007). From January to July in the year of 2007, the exportation of apparel had reached 2,672.80 million (Malaysian Textile Manufacturers Association n.d.).



Cheetah Holdings Berhad was established in year 1979 and was listed on the Second Board of Bursa Malaysia Securities Berhad on 19th January 2005. In year 2007, they have moved into the First Board of Bursa Malaysia Securities Berhad. The objective of the company is to grow its bottom line together with its mission and vision of increasing profitability, satisfying stakeholders and enhancing skills of their people to upgrade their research and development (Cheetah 2007). Cheetah Holdings Berhad has three small business units. They include Cheetah Corporation (M) Sdn Bhd which is in charge of the company’s core apparel business, Cheetah Reality Sdn Bhd which is in charge of property investment, and Cheetah Marketing Sdn Bhd. With regards to this report, our group has chosen Cheetah Corporation (M) Sdn Bhd to be studied in this ‘Strategic Marketing Plan’.

2.2 SBU

Cheetah Corporation (M) Sdn Bhd is involved in designing, development, retailing, and brand building for its Cheetah sports apparel, casual wear and accessories. There are six main developed brand names, which are Cheetah, Cheetah Ladies, Cheetah Junior, Cth Unlimited and C2. The revenue showed a growth rate of 31% from RM2.2 million in year 2005 to RM2.9 million in year 2006 (Cheetah Holdings Berhad 2006). The reason of the growing revenue is because Cheetah Corporation had acquired 75% stake in Above Fashion Sdn Bhd and the famous junior brand, LadyBird from Woolworth Plc. in the year of 2006. As reported in New Straits Time on 21st September 2007, apparel maker Cheetah Corporation with sales of US$25 million is one of the nine companies listed on Forbes Asia 2007 list is widely recognised in its consistency of profitability and growth in the last three years (Nine Malaysian companies on Forbes Asia 2007 list 2007).



3.1.1 Culture

Cheetah Corporation (M) Sdn Bhd believes “cheetah is sleek, strong, swift and unrestrained” (Cheetah Holdings Berhad 2005). No doubt Cheetah has been chosen as their key apparels brand for it represents the spirit of independence, individual expansion and has a powerful strength (Cheetah Holdings Berhad 2005). The company mission is to “increase profitability and generate satisfactory returns for shareholders by continually improving its products and services, anticipating and satisfying the needs of their customers and consumers, enhancing the skills of their people and providing them with regarding career opportunities and upgrading their research and development” (Cheetah Holdings Berhad 2005). Via this mission, the company is mainly focusing on increasing the shareholders’ profit where they think this can attract more investors to invest in their company which will then increase financial resources. Besides, they understood that consumers are their key value in generating more profits. Thus, they are always coming up with quality products as they foresee that customer satisfaction is very important to them. Hence, they have strong intention-to-detail personalities, and this will help them in producing good quality of products. Moreover, the working spirit of employees becomes stronger. They are able to work in a team and the staff are becoming more aggressive to compete with each other as they believe that they are given more career opportunities. “With a well established operation, an excellent track record, a dynamic, professional and hands-on management team” (Cheetah Holdings Berhad 2005), this assures the future success and growth for Cheetah Corporation (M) Sdn Bhd.

3.1.2 Resources

Human Resources:

Cheetah Corporation (M) Sdn Bhd is applying the low cost producer, where they are outsourcing their manufacturing function and obtain cheap labour from China, Laos, Thailand, Philippines to minimise costs. This will enable them to pay more attention in product design and marketing. The success of the Cheetah Corporation today is mainly due to its top performance management. The company is managed by six experienced directors and the posts of each director were positioned based on their own skills and experiences, especially the chairman and Managing Director (Chia Kee Foo), who was forty-four years old and had twenty-five years of experience in the garment industry (Cheetah Holdings Berhad 2006).

Financial Strength:

Although the company is applying the cost leadership strategy where they are producing at low cost, they were able to have high performance. This is because they have sufficient cash in running their business for the future. Thus, cash flow analysis has to be undertaken.

Summary of Cash Flow Statement



Cash from operations



Cash from investing



Cash form financing



Net change in cash



Cash Opening Balance



Cash Closing Balance



Source: Cheetah Holdings Berhad Annual Report 2006

Although the cash of the company at the year end of 2006 was lesser, which was RM 12,006 compared to year 2005 due to the huge decrease in cash from financing from year 2005 to year 2006, the table showed that cash from operations increased in a huge amount from negative amount of RM 938,470 in year 2005 to positive amount of RM 1,384,446. Thus, the financial resources are still considered to have the ability to support their business operations. Besides, the executive director (Chia Kee Kwei) had allocated RM25 million for an aggressive growth target over the next five years (Cheetah acquires 75% stake in ladies fashion accessories retailer 2006).

Market Strength:

Cheetah Corporation is the market leader in the local sportswear industry, commanding 40% of the market share as it entered the market early in the year of 1979 (Investment: Cheetah Holdings 2007). The controllability of the sportswear market in Malaysia is the main contributor in generating profits. This is also considered as one of their resources. Moreover, the company has the highest accessibility among the competitors in Malaysia, allowing them to grab more potential customers.

3.1.3 Stakeholders


Ø The two largest shareholders in the Cheetah Corporation are Chia Yoon Yuen Holdings Sdn Bhd, which is owned by Chia Kee Foo and Chia Kee Kwei. They are the managing director and executive director of the Cheetah Corporation respectively and are both RHB Merchant Nominees (Tempatan) Sdn Bhd. Chia Yoon Yuen Holdings Sdn Bhd are endowed by Cheetah Corporation (M) Sdn Bhd (Cheetah Holdings Berhad 2006). This means that they are the ones who invest in the company and are concerned about the retain earnings or revenues of the company.


Ø Customers are more interested in the latest products promoted by Cheetah Corporation. Pricing as well as the quality standards of the product like improvement of product features will eventually create brand reliability.


Ø Global Concepts Textile Industries Sdn Bhd and Advance Apparel Export Sdn Bhd are the main suppliers for Cheetah Corporation (Global Concepts Textile Industries Sdn Bhd and Advance Apparel Export Sdn Bhd n.d.). The suppliers not only build a close relationship with their buyers, but also communicate with their buyers to discuss the future needs that their buyers require and satisfy those needs by working together to generate profits.


Ø Media plays an important role in most of the listed companies. They create awareness and enthusiasm to the public. News about the company growth, new expansion and development of the company are published, regardless of whether they are positive or negative. Besides, it helps the company to promote the new release products to buyers.


Ø Employees are a group of essential foundation for the company’s future survival as they are responsible to the daily operations of the company. They are concerned with their career opportunities, which allow them to gain more earning income. In addition, they are also interested in their working conditions, wages as well as compensations.


Ø The company’s principle bankers include HSBC Bank Malaysia Berhad, AmBank (M) Berhad and Malayan Banking Berhad (Cheetah Holdings Berhad 2006). These bankers influence the financial resources of company, significantly affecting the cash flow of the company. For instance, the entire leasehold industrial factories of the company such as long leasehold of land and building are charged to local banks and it bears an interest from 7.50% to 8.00% per annum (Cheetah Holdings Berhad 2006). Working close with these banks might help the company to attain lower interest rates and hence this reduces company’s outlays.


Ø The government has a liaison with the Malaysian Textile Manufactures Association (MTMA) and this has allowed them to maintain contact and to sustain the success of the apparel industry. Thus, the government is paying attention on the quality of the products. Besides, they are the ones who imposed regulations and price ceiling for the apparel industry.

3.1.4 Performance

Financial Performance:






Total Asset



Net Profit






Source: Cheetah Holdings Berhad Annual Report 2006

Efficiency (ROA)

YR 2005: YR 2006:

ROA = Revenue / Total assets = 87.8% ROA = Revenue / Total assets = 76.8%

Effectiveness (ROE)

YR 2005: YR 2006:

ROE = Net profit / Equity = 3.33% ROE = Net profit / Equity = 4.21%

The sales of the company increased by RM 700,146 from year 2005 to year 2006 that is mainly due to the expansion of their business. Even though sales increased, the ROA of the company decreased from 87.8% in year 2005 to 76.8% in year 2006. This is because the total assets of the company increased at a slightly faster rate than the revenue. The company is considered as unable to produce wealth for their assets and thus were also not producing efficiency.

However, the value of the shareholders and share price of the company will be increased as the ROE of the company has increased by 0.88% which was from 3.33% in year 2005 to 4.21% in year 2006. Therefore, they were producing effectively and the firm’s value has also been enhanced overall.

Product Performance:


Revenue Contribution Year 06 (%)




Sports & casual wear (Unisex)



Casual back-to-basics wear (Unisex)

Cheetah Junior


Children’s wear

Cheetah Ladies


Sports & casual wear

Cth Unlimited


Casual back-to-basics wear (Unisex)



Fashion & trendy casual (Unisex)





As shown in the table above, the Cheetah brand contributed the highest revenue that is 59%, followed by the Cheetah Junior that contributed 20% to the company in year 2006. C2, Cth Unlimited and C.Union are brands targeted for unisex. However, each of them had only contributed revenues of less than 5%. Conversely, Cheetah Ladies that are targeted only on ladies was able to contribute 12% to the company’s revenue in year 2006 which contributed more compared to C2, Cth Unlimited and C.Union.


Cheetah Corporation has launched six variants in total, each on targeting on different ages, genders and market segments. The market served by Cheetah Corporation is in the age group of 3- 45 years old, interested in sports activities and is concerned about the quality and comfort of clothes.







Age: 15 – 45

Gender: Male &


Income: Middle


Lifestyle: interested in sports activities such as badminton, cycling, basketball, tennis and so on.

Benefit Sought: Quality & comfortable clothing

Malaysia & Brunei


Age: 15 – 30

Gender: Male &


Income: Low &



Lifestyle: interested in general sports activities

Benefit Sought: Quality & comfortable clothing

Cheetah Junior

Age: 3 - 14

Gender: Male &


Income: Middle


Lifestyle: interested in sports activities and

Benefit Sought: Quality, fashionable& comfortable clothing

Cheetah Ladies

Age: 15 - 35

Gender: Female

Income: Middle


Lifestyle: interested in sports activities

Benefit Sought: Quality & comfortable clothing


Age: 15 – 25

Gender: Male &


Income: Middle


Lifestyle: interested in sports, leisure and casual activities

Benefit Sought: Quality, fashionable & comfortable clothing

Cth Unlimited

Age: 15 – 30

Gender: Male &


Income: Low &



Lifestyle: interested in sports activities

Benefit Sought: Quality & comfortable clothing

“Cheetah has been able to capitalize on the prominence of its Cheetah brand name by introducing a host of other related brand names, namely, Cheetah Junior (in 1995), Cheetah Ladies (in 2000), C.Union, Cth Unlimited (in 2003) and C2 (in 2004)” (James 2007). Therefore, the customer base has increased over time due to these horizontal diversifications which allow the customers have more product choices. This can be shown by the increase in sales.

3.2.1 Analysis of Market Served



Customer Need

§ Customers want quality sports and casual wear with reasonable price.

§ Customers consider for the stylish, fit, fabric, durability, versatility and ease for care when purchasing sports and casual wear.

Customer Need

§ Rapid changing of customer preferences and tastes, and fashion trends.

Market Emergence

§ High potential market to grow in apparel industry (Refer PEST Analysis).

§ New sports and casual wear brands are launched for customers in terms of flexibility of the product such as protect from weather, authentic use, nonbinding, breathable, stretches, and practical to compete in the competitive market

Market Emergence

§ Increasing competing imitated brands and international branded sportswear.

Market Boundaries

§ Opportunity to redefine market boundaries as changing in technologies and social trends.

§ Opportunity to enter the Southeast Asia markets such as Thailand, Singapore.

§ Opportunity to enter the big size or giant markets.

Market Boundaries

§ Greater competition intensity in larger market boundaries.

§ More resources and management are needed to sustain in larger market boundaries.

Market Served

§ Broaden the market served to include giant and big sized customers. According to Malaysian Shape of Nation survey reported in New Straits Time in September 2006, Malaysia has the highest number of fat people in Asian region shows double increase over the ten years (Rajen 2006).

§ Consumers prefer value-added products such as sportswear produced by using the organic method. Producing value-added product will be one of the primary criteria to stand out from the competitors (The Malaysian Institute of Economic Research n.d.).

Market Served

§ There are possibilities of the new targeted customers such as giant and big sized customers who do not purchase Cheetah products.

Customer Segmentation

§ Self-oriented that participate in sports to experience the feeling of competition, prefer having challenges, improving their skills, and making new friends.

§ Mature conformists who are the older generation, prefer walking and exercising in general, which they consider health is more important than appearance.

§ Outdoor enthusiast that participate in camping, biking, boating, fishing and so on, who are heavy spenders and want sportswear to be durable, weather resistant and breathable.

Customer Segmentation

§ Becoming more complicated to segment customers effectively as there includes different demographics, psychographics, and behavioural such as the business customers and consumers.





§ High economies of scale required (High capital requirement).

§ Industry dominated by huge companies likes Cheetah and Hing Yiap which both have economic advantages of durability in market.

§ Brand identity easy to create but hard to maintain in competition with “powerhouse” brands such as Cheetah and Antioni.

§ Greatest access to suppliers of raw materials and efficient distribution channels

§ High switching costs.



§ Low concentration of suppliers

§ Huge number of buyers

§ High switching costs as there is contractual obligation.

§ Large availability of substitute.

§ Suppliers can integrate forward.

§ Close relationship with suppliers



§ Small number of local competitors.

§ Marketing strategy must be good to face high competition,. Eg. Promotion

§ Low product differentiation - Only design and colour are provided as basis for differentiation. They are mainly relying on branding and marketing efforts to differentiate products within the market.

§ Exit barriers from industry are moderate due to restrained fixed costs, capital investment and inventory.

Threat of New Entrants



§ Buyer concentration is low.

§ Large volume of customers and buy in low volume.

§ Switching costs between brands low.

§ Low brand loyalty.

§ Low product differentiation.

§ Low threat of backward integration.



§ High degree of substitution. Eg. International brands and imitated brand of sportswear

§ High switching cost for international brands and low switching cost for imitated brands.

Key competitive advantages for Cheetah



§ Market Leadership: 40% market share

§ Early-entry in Malaysia (local sportswear): Cheetah brand was introduced in year 1979 (Ng 2006).

§ Multiple market strategy: Children (3-14 years old) and Female (15-35 years old)

§ Outsourcing manufacturing apparel suppliers that are mainly low-cost producing countries, like China, India or Vietnam (Nathan 2006)

§ Superbrands (gold) was awarded (Global Brand List 2006)

§ Wide distribution/sales network channels with 600 outlets and boutiques across the country (Nathan 2006).

§ High quality and good designing product

§ Able to come out with 1,000 designs in a year (Ang 2007)

§ Top performance management team

§ No sponsorship

§ Its corporation, Cheetah Holdings Bhd was listed for only 2 years in Malaysia

§ Work effective but not efficient

§ C2 (3%), Cth Unlimited (4%), C.Union (2%) had less contribution to group sales

Key competitive advantages for Antioni



§ Sponsorship: Providing official sportswear for the Malaysia contingents to the Malaysian Tenpin Bowling Congress, S.E.A. Games, Asian Games, Commonwealth Games, and the Olympic Games in order to achieve brand prestige (Hing Yiap Knitting Industries Berhad 2003)

§ Its corporation, Hing Yiap was listed for 10 years (Capital Dynamics Sdn Bhd n.d.).

§ Fewer distribution/outlets in Malaysia (97 outlets) (Hing Yiap Knitting Industries Berhad n.d.)

§ Not a market leader

§ Few product designs

Key competitive advantages for Forest



§ Achievements: Receive the Sogo Million Club - Annual Best Sales Achievement award (2003-2006), Superbrands award in Malaysia (2005) and Super Excellent Brand award (2006-2007) (Forest Sdn Bhd n.d.)

§ Launching different product lines. Eg: Golf wear, Sportswear and casual wear

§ High performance merchandise made of ecological faultless and top quality raw material have been provided to customers

§ Establish brand name in Malaysia for 25 years (Forest Sdn Bhd n.d.)

§ Experienced designers with faultless sense of fashion and understands market trends.

§ Its corporation, Target Fashion Sdn Bhd is not a listed public company in Malaysia

§ Weak positioning in golf wear

§ Not a market leader

§ No sponsorship

§ Few product designs

§ Fewer counters are offered in department stores and shopping centre nationwide (150 counters) (Forest Sdn Bhd n.d.)

Key competitive advantages for Schwarzenbach



§ Achieved milestones with the launching of new business executive wear and gym and swim wear respectively that produces under stringent quality control (John Master Industries Berhad 2006).

§ Sponsorship: Providing gym wear for the Miss Malaysia / World Pageant (John Master Industries Berhad 2006).

§ International German brand that was acquired by John Master Industries Bhd in 1994 (John Master Industries Berhad 2005).

§ Its corporation, John Master was listed for 15 years (Capital Dynamics Sdn Bhd n.d.).

§ Few product designs

§ Lowest sports and casual wear market share in Malaysia

§ Laggard-entry: Entering the market in the late growth stage in Malaysia (It was acquired in 1994)

§ Weak positioning in gym wear and swimming wear




Cheetah Corporation has launched six Cheetah brands apparel. They have initially launched the Cheetah brand that suit teenagers and young adults. After that, they targeted a new customer segment by introducing Cheetah Junior brand for children. Thus, the targeted customers for Cheetah Corporation are broadened from teenagers and young adults to children.


Malaysia has weak capabilities in terms of designing, planning, distribution and marketing in the apparel industry. Instead of creating the ‘Buatan Malaysia’ (Malaysia Brand), the Malaysia manufacturers are producing for the world brands like Adidas, BUM Equipment, Christian Dior, Gucci, Guess, YSL, Levi’s, and the like to produce (Malaysia: Textile Competition 2006).

Distribution channels

Cheetah Corporation (M) Sdn Bhd mainly distributes their products in 485 consignment outlets such as Jusco, Sogo, Parkson, The Store, Giant, Carrefour, Tesco and so forth. 85% of its annual revenue comes from consignment counters (Cheetah plans overseas expansion 2007). This encouraged them to expand their consignment outlets greatly from 399 outlets in year 2004 to 485 outlets in year 2007 (Malaysia Equity Research: Cheetah Holdings 2005). Subsequently, they opened up their own boutiques of about 15 shops and 100 sport shops in year 2007 (Investment: Cheetah Holdings 2007). 600 outlets in year 2007 have been largely allocated to Cheetah brand. Among the 600 outlets, 200 outlets belonged to Cheetah and 150 outlets belonged to Cheetah Junior (Investment: Cheetah Holdings 2007).


Political Environment:

Impose of Goods and Services Taxes

Government introduced the goods and services taxes to all industries in Malaysia. However, the government plans to reduce tax by 1% in the Corporate Tax from 28% to 27% in year 2007 and 26% in year 2008 (Malaysia Budget 2007).

Intensive of Domestic Product

In year 2006, Prime Minister Datuk Seri Abdullah Badawi had boost ‘Made in Malaysia’ products by allocating RM2 billion for research and development and marketing technology (Anis 2006). Thus, companies that are interested can apply to improve their daily operations. Besides, the Malaysian Knitting Manufacturers Association also encourages their members to take initiative to mark the “Made in Malaysia” wordings onto their washing labels of local garments. Therefore, this differentiates domestic products from low cost imports.

Economic Environment:

Sales boost due to Visit Malaysia 2007

The government is promoting country’s tourism industry by investing RM400 million together with the tourists spending. It is expected to contribute RM44.5 billion in year 2007, and without doubt this will boost the consumer spending power across Malaysia. Hence, this would be a benefit to Cheetah Corporation who is a major player in the local sportswear retail industry (Retail Outlook 2007- Opportunities and challenges ahead 2007).

Increasing Power Purchasing Products

There is a rapid increase in the number of customers due to increase in economic and consumer purchasing power. This is because the purchasing power in Malaysia has increased by 5.9% in year 2006 and the purchasing power parity was estimated to be RM 313.2 billion in year 2006 (The World FactBook 2007). It definitely increases the profitability for commercial business as well as intermediary parties.

Increasing in exportation of apparel industry

Malaysia is considered to be a greater exporter country especially in the textile industry. “The apparel industry ranked among the top five export earners with overseas sales reaching RM8.5 billion from RM8.4 billion in 2002 and contributed 2.4% to the country’s total exports of manufactured goods and employed over 70,000 workers” (Textile, apparel industry expected to stay competitive 2004). Currently, the government statistic showed exportation of the articles of apparel and clothing accessories had increased by 4% from January to August in both the years of 2006 and 2007 (Department of Statistics Malaysia 2007).

Social Environment:

Consumer health conscious increase as facing stress problem

Consumers today are more concerned about their health. Most of the residents in Malaysia face a lot of stress from their working environments (Fon & Phillips 2003). Therefore, they tend to go for gym, yoga, jogging, outdoor sports and activities and so on in order to reduce stress. Thus, there are higher demands of comfortable sports and casual wear that allow them to exercise indoors as well as outdoors.

Women consider shopping as sports and leisure event

Women are treating shopping as one of their sports and leisure events, and hence the athletic woman apparel will often be their choice. These include comfortable training suits which are stylish and fitting and can be worn while doing shopping (Gilbert n.d.). The sportswear is not attributed to gym or tracksuits only, but today’s trendy sportswear such as Adidas and Nike have added a touch of elegance and sexiness to their sports attires where it can be worn for multi purpose functions and even for style.

Technology Environment:

Outdated Production Design

Malaysia’s dyeing, printing and finishing sub-sectors are outdated (Malaysia: Textile Competition 2006), and hence there is a need to upgrade the existing facilities and technologies. Moreover, the accessories sub-sector which include raw materials such as buttons, sewing threads, interlining, elastic bands, and zippers are outdated (Industrial Master Plan 3 2006).

Unskilled Workers in Textile Industry

Malaysia is currently experiencing a shortage of skilled workers in textile science and technology as well as fashion marketing and especially in design & developing (D&D). Furthermore, Malaysia workers are lagging behind in sophisticated computer-based automated processes in the fashion and apparel industry (Industrial Master Plan 3 2006).

Online Purchase Power Increases

According to IDC’s latest study (Malaysia Internet and eCommerce 2006-2010 Forecast: Tracking the Development), Malaysia is expected to register a strong growth in eCommerce spending of 70% in year 2006. Among the Malaysian population of 26.6 million people, there were 6 million online shoppers in year 2006 compared to 4.7 million unique buyers the year before, in year 2005 (Strong double digit growth in Malaysia’s eCommerce 2006).

Changing Trends from Mass Production to Mass Customisation

The apparel industry is currently undergoing a shift from mass production of standardised products to mass customisation of individualised products (Bye 2004). The advanced computer technology allows customised products to produce in a low cost, and consequently increases the customer demands for individualised products and services. Thus, the strategic use of Internet in retailing can capture the potential market in the fashion and apparel industry.


Key Trends

Internal Analysis:

  • Culture: Cheetah represents the spirit of independence, individual expansion and has a powerful strength.
  • Low cost producer with high performance: Cheetah Corporation is applying cost leadership in local sportswear market.

External Analysis:

  • More international brand loyalty customers.
  • Changing trends from mass production to mass customisation.
  • Lifestyle more onto sports trends: Consumer health conscious increases due to stress problems, women consider shopping as one of their sports and leisure events.
  • Value-added products encouraged the sales increases.

Key Issues

Internal Analysis:

  • Financial strength: Financial resources are available.
  • Strong past performance: High growth rate of sales of about 31.82%.
  • Able to outsource manufacturing to low-cost producing countries.
  • Strong cohesiveness among the employees in the organisation.
  • Top performance management team: Experienced managers.
  • Strong intention-to-detail personalities: Producing high quality products.
  • Close relationship with suppliers.

External Analysis:

  • GDP (purchasing power) increased in Malaysia.
  • Promotion of country’s tourism industry by the government will increase consumer spending power across Malaysia.
  • Proposition of “Buatan Malaysia” that is strongly encouraged by local government.
  • Entry of international brands (Eg: Nike, Adidas, Puma) and imitated product brands to Malaysia.
  • More Malaysian manufacturers produce for major world brand names. Eg: Adidas, Guess, Levi’s.

Key Problems

Internal Analysis:

  • Its corporation, Cheetah Holdings was listed for 2 years only.
  • Work effective (ROE) but not efficient (ROA).
  • C2 (3%), Cth Unlimited (4%), C.Union (2%) had less contributed to sales.
  • No sponsorship to achieve brand prestige in local sportswear market.

External Analysis:

  • Shortage of skilled workers in fashion marketing and design & developing.
  • Malaysia’s dyeing, printing and finishing sub-sectors are outdated.

Key Opportunities

Internal Analysis:

  • Additional investments of RM25 million by the executive director, Chia Kee Kwei for an aggressive growth target over the next five years.

External Analysis:

  • Market strength: Controllability of the local sportswear market with 40% sportswear market share.
  • E-retailing: Online purchasing power increased.
  • Expands overseas: Exportation of articles of apparel and clothing accessories increased.
  • Potential market segment was left out: Giant sized customers would be one of the potential customers.



  • Profits: To extend Cheetah product line.
  • Growth: Creating more awareness locally and bringing it into international market.
  • Customers: To cover a wider potential range of multi market segment and gain loyalty.
  • Cost: Applying cost leadership in local sportswear market.
  • Value added and social responsibility: Towards organic method.
  • Distribution channel: Increase accessibility of the market.


· Profits: Focus on Cheetah Corporation’s own brands by reaching 70% of sales which is contributed from Cheetah product in three years.

· Growth: Reach 50% of local market share in four years and exporting to other Asia countries such as Thailand and Singapore in two year.

· Customers: Reaching 85% of sports apparel and 15% lifestyle apparels in three years.

· Value added and social responsibility: Reaching towards organic methods by the end of year 2007 through 600 retail networks (Malaysia: Cheetah-The Big Leap 2007).

· Distribution channel: Setting up more 100 consignment outlets in new departmental stores and hypermarkets within two to four years.



Sport and Casual Wears Market Composition



Growth Rate


Market Share

































Source:捷豹扩大收入来源 2006

Cheetah Holdings Berhad Annual Report 2005/2006

Hing Yiap Knitting Industries Berhad Annual Report 2005/2006

John Master Industries Berhad Annual Report 2005/2006
















1.5 1.125 0.75 0.375 0

NB: Please refer Appendix A for figures used for BCG Matrix.


In the sports and casual wear industry, Cheetah Corporation falls under the star quadrant. It means Cheetah Corporation is currently experiencing high growth in the high relative market share. The company generated large profits and have a high long-term potential to make profits in the future and more cash inflows that they generated might be used to offset the other SBUs’ performances in the company in order to maintain and increase the market share. There is 60% of the potential market share belonging to the competitors, and Cheetah Corporation has to make use of this opportunity to grab higher market share from their competitors although they are currently in star position.


At the present, Antioni has a low and unattractive relative market share and low growth rate in the sports and casual wear industry. Although Antioni is in the declining stage of the product life cycle, they are still generating a positive cash flow. Currently, the company generates low profits and possibly have some future potential for profits only.


Forest has the small market share in a mature sports and casual wear industry, which are low in growth rate and relative market share. The company generates a small rise in profits currently and this leads to little potential for the long-tem future. The company may generate sufficient cash to reach break-even point by focusing in the niche market (golf wears), but they might difficult to improve sufficiently and might be of less worth to be invested by their parent company.


Schwarzenbach with a relative low market share in low growth market are nominated as Dog. The company suffered from having low market share in the sports and casual wear market, which is mature and slow growing. Yet the company still has competitive strengths such as focusing in niche market (gym and swimming wears) which the other competitors are not focusing in. Thus, this becomes their additional profitable growth for Schwarzenbach to sustain in the competitive market.



Current Strategies

Proposed Strategies


Market Scope Strategy

Multi-market Strategy:

§ Target on different segments by ages (Cheetah Junior), gender (Cheetah Ladies), and concepts (C.Union is for fashion & trendy casual).

Multi-market Strategy:

§ Not only need to maintain but also expand its’ multi-market strategy to serve some potential market segments that was left out such as giant or big size customers.

§ This strategy assists Cheetah Corporation to gain higher profits and more growth potential by diversifying the risk into different markets such as segments by ages, gender and concepts.

§ This strategy is to ensure that potential market segments will not be left unserved and consequently gaining greater profitability and increase market share.

Market Geography Strategy

National-market Strategy:

§ Mainly distributed in Malaysia and a few distribution outlets were distributed in Brunei to secure long term viability in industry.

International Strategy:

§ Expand to Southeast Asia countries which have similar cultures and buying behaviours with Malaysia such as Thailand, Singapore to test the viability of the market.

§ Extensive market research needs to be conducted to assess the viability of the market prior to entry.

§ Cheetah Corporation had successfully the 40% of local sportswear market share in Malaysia that will boost the plan to expand to overseas.

§ To build international brands will assist the greatest potential for growth and also market share.

§ Strong past performance and financial resources is available.

§ The increasing of exportation in Malaysia encourages international strategy.

Market Entry Strategy

Early-entry Strategy:

  • In 1979, Cheetah brand was introduced in Malaysia and was early entrant in the local sportswear market.

First-in Strategy:

§ First-in in the local sportswear market of “Cheetah Giant” that is recommended in product strategies.

§ Encourage brand recognition/association potential and it will be a threat if it does not implement first-in strategy.

§ Generate primary market demand for “Cheetah Giant” in giant size customer segments.

§ Little intense competitions of this niche market currently in local sportswear market.

§ Cheetah Corporation is able to strengthen their competitive advantages and maintain its top position on the other hands.


Perceptual Map:

Current Strategies

Proposed Strategies


Product Positioning Strategy


§ Cheetah and Cheetah Ladies (Sports & casual wear), Cheetah Junior (Children’s wear), Cth Unlimited and C2 (Casual back-to-basics wear, C.Union (Fashion & trendy casual).


§ High quality but low cost.

Use or Application:

§ Sports activities, leisure activities and ordinary occasions.

Product User:

§ 3 to 45 years old.

Product Class:

§ Superbrands (Gold)


§ 1,000 product designs

Product Repositioning Strategy

Reposition amongst existing customers:

§ Main attribute, sports & casual wear in Cheetah has override C.Union and lead to confused positioning in C.Union (fashion & trend casual). Thus, Cheetah Corporation is recommended to strengthen its position.

§ From the perceptual map above, this showed that this is weak positioning in C.Union where it has led to the declining of sales as this cannot find its special niche in the market compared to the rest of existing products.

§ If this condition was continued to exist, this might lead to the problems of cannibalism and in turn elimination of the C.Union would be needed.

§ Repositioning C.Union to its original concept (fashion & trend casual) amongst the existing customers will definitely boost its sales.

§ This strategy can be implemented by promoting and telling the existing customers that C.Union is worn for fashionable appearance (touch of elegance and sexiness was added to C.Union).

§ This is very few new investments need to be made, except for promotional costs.

Product Overlap Strategy

Competing Brands:

§ Cth Unlimited and C2 seek to maximize overall sales and profits.

Competing Brands:

§ This is not recommended.

§ Cth Unlimited and C2 are using same concept, casual back-to-basics wear and are both targeted on same segment, 15 to 30 years old customers.

§ This strategy does not seem to be successful as they have only contributed 4% and 3% respectively to the sales.

§ Two brands did not increase substantially and also did not provide a more aggressive front against competitors.

§ They have no their special niche in the market, that will lead to lead to problems of cannibalism among competing brands and in turn product elimination strategy would be needed to be implemented.

Product Scope Strategy

Multiple Product:

§ Cheetah, Cheetah Ladies, Cheetah Junior, C.Union, Cth Unlimited and C2

§ Each brand presents in different styles of clothes. Cheetah is for sports & casual wear, C.Union is for fashion & trendy casual.

§ Different targeted segments in each brand. For example: Cheetah Junior targeted on children segment, Cheetah Ladies targeted on female segment.

Multiple Product:

§ Existing brands are retained

§ Introduce “Cheetah Giant” to a new segment, giant size customers who prefer sportswear and difficult to buy the size suitable for them.

§ “Cheetah Giant” has its special niche in the market which targeted on the giant size customers.

§ Each existing brand and proposed product “Cheetah Giant” can find its special niche in the market such as different targeted segments, different styles of clothes presented.

§ “Cheetah Giant” does not cannibalise market share and/or profit of the other existing brands (Cheetah, Cheetah Ladies, Cheetah Junior, C.Union, Cth Unlimited and C2) in the same market.

§ Cheetah Corporation needs greater resources and better management to offer multiple products.

§ The multiple products they offer should complement each other in some way.

Product Design Strategy


§ Standard products are offered in different designs and styles with varying prices.

§ In other words, customers have broader choices to buy different designs and styles of standard sports and casual wears offered.


§ Standard product strategy is recommended to implement for all existing brands.

§ This strategy that is implemented for most of the customers should be maintained.

Standardised Customisation:

§ Standardised Customisation product strategy is recommended to implement for one existing brand only which is Cheetah.

§ Online customers are given the option to specify a limited number of desired modifications to a standard product.

§ For example, different colours, custom sizes, different styles and designs (with collar, short sleeve, V neck, and others)

§ Standard product strategy is maintained as the mass distribution and marketing is much easier and this also offers experience effects and cost benefits.

§ Standardised customisation can offer the benefits of both a standard and a customised product.

§ These products are individualized to meet the specific requirements of the customers.

§ Standardised customisation requires Cheetah Corporation to keep close contacts with the market and have the experiences in developing new standard products.

§ Standardised customisation strategy is not recommended to implement for most of the customers as this requires greater human resources and financial resources compared to standard product strategy.

§ Therefore, one of the existing brands, Cheetah would be the best option to test the viability of the market as it was the highest sales contribution compared to others existing brands.

§ This is more effective if Cheetah Corporation implements standardised customisation on certain targeted groups only such as online customers.

Product Elimination Strategy



§ Divest C2 that contributed lesser (3%) to the sales compared to Cth Unlimited (4%) where they are using same concept and target on the same segment.

§ The decision to divest C2 will be impossible to reverse once the elimination has been achieved.

§ This is less effective to boost its sales by repositioning C2 into new segments or creating more awareness as its sales contribution is in very small percentage compared to other existing brands. In addition, C2 will become profit drains for Cth Unlimited and this is greater advantage in implementing other strategies rather than sales boosting in C2 that the resources could be used. Thus, the divestment strategy is recommended to be implemented.

Value-Marketing Strategy

Quality Strategy:

§ Producing Cheetah products by applying organic method.

Quality Strategy:

§ This strategy is needed to be maintained.

Customer Service Strategy:

§ Trade-in service is available for all existing brands to customers.

§ Provide after sales services within a month for Cth Unlimited only such as customers can personalize their sportswear by sewing on some special badges or their preferred buttons, and provides lettering or embroider to Cth Unlimited where these are only available in Cheetah boutiques.

§ Towards organic method is matching with its objective and achieve their goal consequently in order to meet the social responsibility.

§ Cheetah Corporation can gain their reputation in the public and show interests of social responsibility to public by donating the trade-in sportswear to the charities.

§ This after sales services will require more specific employees in doing this job and consequently incurred more labour costs if it was implemented on all existing brands in comparison with focus on Cth Unlimited only.

§ In addition, it also helps to avoid problems of cannibalism of Cth Unlimited with other existing brands and to boost its sales by adding-in the value on it, thus this is recommended to implement on Cth Unlimited only.


Current Strategies

Proposed Strategies


Price Strategies for New Products

Penetration Pricing:

§ Cheetah Corporation is the cost leadership in local sportswear market.

Penetration Pricing:

§ This pricing strategy is needed to be maintained for Cheetah Corporation’s new product, Cheetah Giant.

§ This is ineffective and is not recommended to implement skimming pricing as this does not match with its goals (cost leadership).

§ The customers served (medium- and low-income earners) are more price sensitive and easier to brand switching due to price fluctuations.

§ Pricing low to discourage new entry barriers and potential competitors from entering market.

Price Strategies for Established Products

Maintaining the Price:

§ Pricing is remained unchanged to maintain market share and profitability in the marketplace.

Maintaining the Price:

§ This pricing strategy is needed to be maintained to enhance public image and also due to uncertainty of unpredicted impacts exists as the result of a price change.

§ Increasing or decreasing the price will lead to negative impacts to the sales.

§ Increasing the price will encourage customers to switch to other brands especially for they are acting as cost leadership, whilst, decreasing the price will lead to declining in sales and customers’ suspicious towards the product quality.

Price-Flexibility Strategy

One-Price Strategy:

  • All customers will be charged the same price for the same quantities.

One-Price Strategy:

§ This pricing strategy is needed to be maintained.

§ Mass distribution and mass selling employed is much easier.

§ Decreased administrative and selling costs.

§ Favourable and fair image among customers as no single customer will receive special pricing favours over another.


Current Strategies

Proposed Strategies


Channel-Structure Strategy

Indirect Distribution Strategy:

§ Manufacturer è Large Retailers (Consignment outlets, boutiques, and sports shop) è Customers


§ Producing in anticipation of sales for all existing brands.

§ Improve economies of scale in manufacturing, reduces costs of frequent ordering and administrative costs.

Direct Distribution Strategy:

§ Online distribution for standard products (all existing brands) and standardised customisation products (Cheetah brand only)

§ Manufacturer è Online Customers

Indirect Distribution Strategy:

§ Local Market: This strategy is needed to be maintained.

§ International Market: Manufacturer è Agents è Large Retailers è Customers


§ Producing after receiving a confirmed order for standardised customisation products (Cheetah brand) only.


§ Remained unchanged for all standard products (all existing brands), except for standardised customisation products (Cheetah brand only)

Direct distribution:

§ This eliminates the intermediaries where also reduces distribution costs, and will consequently resulted in lower prices of the products to be offered.

§ Time saving where delivery process is faster than indirect distribution strategy.

Indirect distribution:

§ In the international market, agents are needed to be intermediaries between local outlets in Malaysia and the distribution outlets in foreign countries.

§ This will result in higher prices of the products to be offered in international market due to increasing of the associated distribution costs with the additional intermediaries.


§ Eliminate risk by matching production and distribution with actual customer demand.

§ Best distribution strategy for a confirmed order of standardised customisation products that are based on each individual customer’s specific requirements.

Distribution Scope Strategy

Selective Distribution:

§ Only certain large retailers are allowed to distribute Cheetah’s products such as consignment outlets (The Store and Parkson), boutiques, and sports shops.

Selective Distribution:

§ This strategy is needed to be maintained.

§ Cheetah Corporation’s products should be widely distributed through consignment outlets as they were successfully generating high profits through consignment outlets, the largest of Cheetah’s retailers which contributed 85% to sales.

§ Exclusive distribution is highly dependent on one retailer only which may lose sales because outlets are not convenient (distribution outlets should be expanded but should not be reduce to restrain its accessibility of the products).

§ Intensive distribution is costly and ineffective where it will only profitable with a high volume product. This is not useful if the customers have both a preference for a particular store and for a specific brand.

Multiple Channel Strategy

Competing Channels of Distribution:

  • Consignment outlets (The Store and Parkson) are competing with each others to avoid their competitors will get Cheetah brands.

Competing Channels of Distribution:

§ This strategy is needed to be maintained.

§ This strategy will force consignment outlets, which are Cheetah Corporation’s largest distribution channel, to put extra efforts in competing against themselves as well as against other manufacturers’ dealers. As a result, this will definitely benefit overall Cheetah’s sales.

Dunt print tis page… be attention to the pages






MR for Southeast Asia Countries Market Viability

Research and Strategy Consultants

9 Months

Extension of Multiple Product: Cheetah Giant

Marketing/Communication Department and Product Design and Development Department

18 Months

Product Repositioning: C.Union

Marketing/Communication Department and Product Design and Development Department

6 Months

Online Retailing

Information Technology Department, and Product Design and Development Department

20 Months

Product Elimination: C2

Production Department, Marketing Department and Management Department

8 Months

Manufacturing: Organic Method

Production Department

18 Months

Value Marketing: Trade-in, After Sales Service

Customer Service Department

6 Months

Extension of Distribution Channels

Marketing and Logistics Department, and Production Department.

20 Months

Seasonal Sales Promotions, Coupon, and Banner and Press Advertisement

Marketing/Communication Department

12 Months

Sponsorship Evaluations/Proposals

Public Relations Department

6 Months

N.B: All activities outlined in Implementation Program will be conducted in house by the Cheetah Corporation except for market research for Southeast Asia countries market viability.


Ø To verify the level of awareness from the publicity including using organic method to all existing brands of Cheetah Corporation, repositioning of C.Union, online retailing, and the launching of new brand (Cheetah Giant) through advertising campaign – Marketing/Communication Department

Ø To evaluate the its effectiveness through the sponsorship – Public Relations Department

Ø To obtain responses towards product elimination of C2 – Production Department, Marketing Department, and Management Department

Ø To determine production level to match with the actual demands and to determine the preferences and tastes of the customers in order to meet their needs – Production Department, and Product Design and Development Department

Ø To assess their opinions about the company value added services and extension of their distribution channels – Customer Service Department, Marketing and Logistics Department, and Production Department

All of the objectives above will constantly be evaluated and monitored by the Cheetah Corporation so that the proposed strategies that facilitate the company in achieving their goals can be implemented. The following monitoring tools can be used to scrutinize the successfulness.

Ø Frequent updates of the information from current market and analyse the existing data.

Ø Survey the responses from the public by obtaining feedbacks from them.

Ø Comprehend and analyse the attitudes of stakeholders.