Niche Market Opportunities in the Global Marketplace

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Title: Niche Market Opportunities in the Global Marketplace
Author: Parrish, Erin Dodd
Advisors: Dr. Nancy L. Cassill, Committee Co-Chair
Dr. John Dutton, Committee Member
Dr. William Oxenham, Committee Co-Chair
Dr. Michelle Jones, Committee Member
Abstract: The purpose of this research was to analyze how a niche strategy can be used by US textile and apparel companies to compete with lower priced imports. With the increasing globalization of the industry, it has been suggested that companies focus on products that offer a competitive advantage over commodity products (Standard and Poor's, 2003). One way of doing this is to focus on specialized, or niche, products. The conceptual models used in this study provided a framework for specialization within trade. The trade theories examined were 1) Ricardo's Comparative Advantage Theory (Ricardo, 1817), 2) Heckscher-Ohlin Trade Theory of Factor Proportions (Heckscher & Ohlin, 1991), 3) Posner's Technology Trade Gap Theory (Posner, 1961), 4) Vernon's Theory of the Product Life Cycle of Trade (Vernon, 1966), and 5) Porter's Model of Competitive Advantage (Porter, 1998). Each of these trade theories predicts specialization as a result of trade. This means that as trade barriers decrease, a country's resources will focus on those processes in which it has a competitive advantage. For the US textile and apparel industry, this means moving away from basic textile items used in apparel production, such as basic fabrics, and moving towards more focused and specialty products, which includes niche products. The methodology used in this study consisted of two phases. Phase I used a deductive research design with an aim to clarify niche strategy issues and provide breadth on the topic (quantitative data). The instrument utilized in this phase was an online survey, which was developed by the researcher and contained three sections: company information, niche markets and globalization. Because of the limited literature on niche markets, the survey was used to obtain information to develop Phase II of the study. The initial sample for Phase I was made up of 63 companies from five sectors in the US textile and apparel industry. These were fiber and yarn producers, mill producers, sewn goods producers, retailers, and auxiliary companies. The final sample consisted of 19 companies from four of the five sectors. Phase II used an inductive research design, with a case study methodology (qualitative data). The two-page interview questionnaire was developed by the researcher and was used to provide depth to the issues uncovered in Phase I. The sample consisted of two companies from each of the four sectors (fiber and yarn, mill products, sewn goods, and auxiliary), resulting in a total of eight companies. The information gathered through the case studies presented additional insight into how a niche strategy is implemented and thereby how it is utilized by US textile and apparel companies in order to compete with imports. Results indicated significant niche product and market strategies that are currently being used and are strategically designed for future market implementation. Niche strategy models were developed which contain both market and product strategies for each sector and one model for the industry. Results from this study will provide academic and industry personnel with business strategy formulation to create and maintain niche markets as well as to provide a research framework for international textile and apparel researchers.
Date: 2003-06-25
Degree: PhD
Discipline: Textile and Apparel, Technology and Management

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