2012 Marianne Marchant July 12th, 2012

[ALDO GROUP INC.] This document contains a brief history of Aldo Group, the industry they are in a nd the atmosphere of Aldo Group headquarters. As well this document attempts to explain the success up to date at Aldo Group, their current problems, and action s Aldo Group has implemented in order to combat their problems. Table Of Content: Background Information 2 Industry 2 Atmosphere 3 Success 4 Problem 6 Solution 6 Global Expansion 6 Consolidate Brands 7 Expand to new Markets 7 Bibliography 9

Background Information Aldo Bensadoun started Aldo Shoes in 1972 as a small footwear line in a Canadian retail clothing store. Six years later, Aldo opened their first store i n Montreal, Canada, putting an end to selling their products through other depar tment stores. In 1993 Aldo expanded their market coverage by entering the U.S. market, and has grown to a current total of 475 stores in the U.S. market at present. T oday Aldo Group is the Umbrella Company for 8 banners of Aldo Group in the retai

l footwear and accessories industry; ALDO, ALDO Accessories, ALDO Outlet, Little Burgundy, Feet First, Locale, Globo, and Call Spring. Aldo Group runs over 1,60 0 stores in about 60 countries. Of these 1,600 stores, about 1,300 are operated under the ALDO banner. Today Aldo Bensadoun remains the founder and chief executive officer at age 73, with his eldest son, David Bensadoun who is vice president of global ret ail. In addition his younger son, Douglas Bensadoun, is on the executive team as well. Lastly, his daughter Daniela Bensadoun is being trained at McGuill, and N YU to enter the Aldo Group team within the next four years. Industry: Aldo Group currently has the highest earnings per square foot at $1,000/ ft out of all other Canadian mall shoe chains. As well, Aldo Group makes an avera ge of $1.5 billion per year. At the end of 2011, the Textile, Apparel and Luxury Goods industry topped the In ternational Business Times Top 10 Industries with the Worlds Fastest Growing Compan ies list (IBT1000). This indicates that Aldo Group is constantly facing many succes sful competitors. The average compound annual growth rate of companies within th e Textiles, Apparel and Luxury Goods industry is currently at 24.6%. Atmosphere: At Aldo Group everyone is dedicated to the organizations fundamental values, inte grity, respect, and love. Through these values management and upper levels have created programs to help employees be the best they could be in both personal an d professional abilities. The head office of Aldo Group is designed to relax and stimulate employees. Aldo Groups main atrium is almost the same size as a baseball field, and is filled wi th art that Aldo Bensadoun, and his wife Dianne Bibeau personally chose out with the intention of generating conversation among employees. This Dianne Bibeau ex plained stimulates creativity, and allows employees to interact over the art wit h people from many different departments. In addition each floor has lounges wit h natural lighting, and decorated with the work being done on each floor in mind . For instance, the floor with advertising and media production has a lounge dec orated with old vintage record covers, and images of the many models Aldo Group works with. This keeps employees stimulated, even when they are taking breaks. Recently, Aldo Group has been promoting a companywide initiative to go green. Al l through the organization there are recycling, and compost areas for employees to properly dispose of their waste. Another benefit for employees to go green co mes in VIP parking spots close to the entrances for those employees who carpool. Aldo group also provides a large fully stocked gym with trainers for all employe es, and a 30-lot community garden on its property. Aldo Group believes that a hu ge part of its success comes from the employees they hire. Therefore, Aldo group takes extreme care in selecting employees, and even more care to keep them stim ulated. Success: Aldo Group maintained successful through a number of techniques, however , with the goal to always innovate and re-invent the brand. David Bensadoun said , The worst thing is to run a concept that has gone stale, (Strauss) and that is p recisely how they run their business. The main areas that influenced Aldo Groups success come from the corporat e synergy throughout Aldo Group globally. Secondly, from the variety of methods designers use to triangulate the new collections. Thirdly, their minimalistic ma rketing tactics, and lastly, their methods to save money. Aldo group controls many aspects of all their stores globally from the c omfort of their headquarters. Daily employees are paid to walk through virtual s

tores, and mock retail spaces to perfect the layout and display cases in stores. Aldo Bensadoun continues to take part in this process to keep up with trends an d be the first to bring a style into a particular country. Aldo Bensadoun said i n an interview, you have to be fast and you have to renew yourself constantly. Ou r strength is to adapt.(Strauss) This technique has created synergy in a rapidly growing industry where other outlets take longer for changes to go global. Secondly, at Aldo Group the designers are told to look for trends on the street, as well as to analyze the economies and politics going on in the world. It is the strong belief at Aldo Group that fashion comes from the everyday life , which is influenced by the actions in the world. In the early years of 2000 Al do Group launched combat-style boots after the outbreak of so many wars. Aldo gr oup knew they had to produce something different than their competition if they wanted to survive in the long run. Thirdly, Aldo Group does not advertise as much as other companies in the industry. Instead, when Aldo Group began breaking into new markets, they would only place one billboard in a very popular space in the city. This gave people t he perception that they were a big brand; however they really pout all of their marketing on the one billboard. The second part of their marketing tactics is to make the stores look very high fashion and chick. By maintaining a very low marketing budget Aldo Group could keep overhea d to a minimum and sell cheaper shoes to their customers. Aldo Groups customers w ant low priced, high-fashion shoes, but they dont want to think of the shoes as c heap, because that would diminish the perceived quality of the shoe. Lastly, Aldo Group continues to be so successful, because they are very good at pinching pennies. Aldo Group does not use middle men to produce their sh oes, instead Aldo Group representatives go to the factories all over the world, and negotiate with the primary source directly. This ensures a high standard of quality, as well as good business relations, and cheaper prices. These ideas and techniques have made Aldo Group a successful company tha t has continued to grow for the past 40 years.

Problem: After the financial crisis that peaked in 2008 many companies began to a dopt the philosophies and practices of Aldo Group. High-end footwear retailers w ere feeling the financial crunch as disposable income decreased. These high-end retailers began to enter the market with more affordable shoes, and compete dire ctly with Aldo Group in the cheap-chic market. This has led to reduced growth in the North American markets. In North A merica everyone sells shoes now, and Aldo Group has already spread itself all ac ross North America where is wants to be. Aldo Group fears staying stagnant, and needs to innovate before they ris k losing their customers to their many competitors. Solution: Aldo Group managed to pull through the recession, and still maintain lar ge profits, and continued growth through a combination of strategies. Although A ldo Group could not have succeeded without any of their initiatives, the most in fluential strategies Aldo Group utilized was to aggressively push global expansi on, consolidate brands, and expand to new markets. Global Expansion: Aldo Group has reached limited growth capabilities for their banner stor es in the heavily saturated North American market. In response, Aldo Group has t argeted their international clientele more. In April of 2011 Aldo Group opened t heir first Aldo store in Rome, Italy and another in Milan a week later. Aldo Gro

up has not stopped there; they have plans to open more stores in different count ries to almost double their profits within the next five years. Consolidate Brands: Aldo Group has noticed many needed changes throughout their Banner brand s. For instance, the brand FeetFirst was created for the baby boomers that typic ally looked for more comfortable shoes. However, recently trends have been indic ating that the clientele care more for fashion than they do for the comfort of t heir shoes. Therefore, Aldo Group has set out to re-image FeetFirst to be high f ashion, without losing the comfort. In addition, Aldo Group closed down three of their brand names that were not as successful, Pegabo, Calderone and Simard. Aldo Group converted these sto res into Aldo banner stores, to increase the market share of their core business . Expand to New Markets: Aldo Group is extending their reach by expanding to two new markets. The first being an consulting service, and the second being wholesale. Aldo Group has created a B2B sector that caters to the consulting needs of other retailers. Recently Aldo Group has worked with Sixty USA Inc. whose sal es has been very low, and has had to shut down some stores. Aldo Group will mana ge 20 of their stores, as well as recruitment and training. Aldo group is workin g with Mark Wiltzer for Sixty Canada, to streamline all operations, and improve business. Aldo Groups consulting service gives retail chains looking to improve the ir market share the benefit of Aldo Groups knowledge as well as contacts. Aldo Gr oup uses their contacts to help the company reduce both overhead costs as well a s production costs. The second market Aldo wants to enter is the wholesale market. The whole sale market will boost Aldo Groups revenue, and help them expand, without too man y upfront spending fees. Aldo Group has signed deals with Kohls, J.C. Pennies, an d Zappos.com. Soon customers will be able to get Aldo shoes at a number of locat ions.

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ag. Business Source Complete. Web. 10 Jul 2012. Strauss, Marina. "Aldo s Global Footprint." Globe and Mail [Montreal] 24 Aug. 20 11, n. pag. Web. 12 Jul. 2012. <http://www.theglobeandmail.com/report-on-busines s/small-business/sb-growth/going-global/aldos-global-footprint/article601117/?pa ge=all>. comp. "IBT1000: Top 10 Industries With The World s Fastest Growing Companies." I BT1000. International Business Times, January 2012. web. 10 Jul 2012. <http://ww w.ibtimes.com/articles/282643/20120116/ibt1000-top-10-industries-world-s-fastest .htm>. Tousignant, Isa. "A space that inspires." Canadian Business(2012): n.pag. Busine ss Source Complete. Web. 10 Jul 2012.