NATIONAL INSTITUTE OF FASHION TECHNOLOGY, DELHI.

MERCHANDISING

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UNITED COLORS OF )ENETTON

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Benetton Group is a global fashion brand, based in Treviso, Italy. The name comes from the Benetton family who founded the company in 1965. Benetton roup is listed in !ilan. Benetton has a networ" of around 6,### stores in 1$# countries. The stores are managed by independent partners and generate a total turnover of over $ billion euro. In 1965, %uciano Benetton, the eldest of four children, was a &#'year'old salesman in Treviso. (e saw a mar"et for colourful clothes, and sold a younger brother)s bicycle in order to buy his first second'hand "nitting machine. (is initial small collection of sweaters received a positive response in local stores in the *eneto region, and soon after he as"ed his sister and two younger brothers, ilberto and +arlo, to ,oin him. In 1965, the entity "nown as the -Benetton roup- is formed. In 1966, the Benettons opened their first store in Belluno and three years after in .aris, with %uciano as chairman, his brother ilberto in charge of administration, their younger brother +arlo running production, and iuliana as a chief designer. Today, the Benetton roup is present in 1$# countries around the world. Its core business is fashion apparel/ a group with a strong Italian character whose style, 0uality and passion are clearly seen in its brands, the casual 1nited +olors of Benetton, the glamour oriented 2isley, the leisurewear brand .laylife. The roup produces over 15# million garments every year. Its networ" of around 6,### contemporary stores around the world, offers high 0uality customer services and generates a total turnover of over $ billion euro. Headquarters: Benetton roup)s +orporate head0uarters is located at *illa !inelli in .on3ano, about &# "m from *enice. *illa !inelli is a comple4 of si4teenth century buildings of great historical and cultural interest. The villa was ac0uired by Benetton in 1969 and the tas" of restoring and remodernising the comple4, entrusted to architects 5fra and Tobia 2carpa, too" over fifteen years. 6rom the mid 197#s *illa !inelli became the head0uarters of the roup and home to all its strategic functions. Around 6,000 stores worldwide/ The development of Benetton)s commercial networ", characterised by prestigious locations in historic and commercial centres and by the high level of customer services offered, has been supported by a ma,or programme of investment worldwide. The Benetton stores carry complete collections, as well as a wide selection of accessories, offering a full range of Benetton style and 0uality. Design/

5 staff of &## designers from all over the world creates the collections for the casual 1nited +olors of Benetton, the glamour oriented 2isley, the leisurewear brand .laylife. The design team is also engaged in researching new materials and creating new lines for different targets from children, men and women to e4pectant mothers, offering them not only practical and modern styles but also ma4imum comfort. The result is the latest trends in design and a rich output of many models a year which are reali3ed with computer assisted design systems fully integrated with the rest of the company)s production phases. Production/ +onsistently high 0uality is one of the fundamental characteristics of the Benetton production process from the raw materials to the finished garment. 5 constant commitment to innovation, a crucial factor for development, has always characteri3ed the roup8s business organi3ation, from communication to IT, from research into new materials to integrated logistics. 2pecial attention is given to innovation in production, where all systems and e0uipment are constantly renewed. The Benetton production system, co'ordinated by a high'tech facility at +astrette 9Italy: is capable of turning out over 15# million garments every year. Logistics/ Benetton has direct control of the logistics phase for both own manufactured and sourced products, and has invested in modelling, organi3ation, and automation of logistic processes in order to completely integrate the entire production cycle, from client orders, to pac"ing and delivery. Automated Sorting System The state'of'the'art logistics operation at +astrette 9Italy: has a fully automated innovative sorting system, whose propulsion is based on electromagnetic fields, capable of handling individual orders for around 6,### Benetton shops worldwide. 6olded and hanging garments are automatically sorted, pac"ed into bo4es and sent through a one'"ilometer tunnel to the 5utomated ;istribution +enter. Automated Distri ution !enter The 5utomated ;istribution +enter covers an area of &#,### s0uare meters, with a total capacity of 7##,### bo4es, and is able to handle 1$#,### incoming<outgoing bo4es daily with a wor"force of only $7. The finished product is sent directly to the roup)s around 6,### retail outlets in 1$# countries worldwide.

B"A#DS:
$nited !olors o% Benetton: 5 global brand, and one of the most well "nown in the world, 1nited +olors of Benetton has an international style that combines color, 0uality and fashion. =ach season the womenswear, menswear, childrenswear and underwear collections offer a total loo" for everyday, for wor" and for leisure, in the city and outdoors. The Benetton Baby label is a new product line dedicated to the prenatal and the under'fives world.

The brand is present in many other sectors, from the elegant accessories to the eyewear lines and perfumes, from the home collection to baby products. The above products are available in selected speciali3ed shops worldwide. $ndercolors o% Benetton / This is an e4tension of the Benetton brand, featuring underwear, beachwear and sleepwear collections, as well as accessories for women, men and children.

5 wide selection of recurring basic colors is enriched every season with the latest trends. 1ndercolors is available in its own chain of stores which now has more than 5## locations in thirty countries and in selected Benetton 2hops. Sisley/ This is the roup)s most fashion forward brand. 2isley presents elegant and seductive collections, with special attention given to the choice of design, fabrics and new shapes.

Its creative artists and independent sales teams concentrate their efforts on its image and on strong'impact advertising campaigns. The brand has created the very fashionable 2isley >oung line for children from 7 to 1$ years old. Playli%e /

This is the Benetton leisurewear brand that redefines a style. ?ith its clean and elegant collections .laylife blends an e4clusive e4ploration of styles and allusions and a strong sense of individuality.

The brand8s new store concept reflects the same values, highlighting their emotional content.

&erc'andise &i(:
The breadth and depth of the products carried by retailers is called as merchandise mi4. This is also "nown as .roduct 5ssortment.

$nited !olors )% Benetton: &erc'andise Assortment AD$L* :

+oman And &an: 1nited +olors of Benetton chooses a "eyword for the 5utumn<?inter $#1#'11 collection/ freedom, a clear and simple word with many meanings. In this case, the freedom we allow ourselves when choosing our loo" every'day. 1nited +olors of Benetton has always followed this principle and offers even greater freedom of choice for the new winter season.

Accessories:

The 5utumn<?inter $#1#'11 1nited +olors of Benetton accessories and footwear collection e4plores new frontiers of in terms of shape, material and colour.

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&amma: 6uture mums will en,oy an 5<? collection from 1nited +olors of Benetton that8s big on comfort and full of the new season8s trends.

Ba y .0/0 year1: 1nited +olors of Benetton chooses a romantic, natural mood for the new borns of the 5<? $#1#'11 season. 2oft fabrics and light, pastel colours combine with prints and drawings to warm the winter days.

*oddler .0/2 years1: In 5<? $#1#'11 1nited +olors of Benetton ta"es the smallest children by the hand and accompanies them in their new adventures and earliest discoveries.

,id And *ween .6/03 years1: 6or the girls, 1nited +olors of Benetton have created an imaginary tour around the world, proposing places and moods that evo"e the new loo"s of the 5<? $#1#'11 season. 6or the boys, it8s all about the 5merican way of life.

$#D4"!)L)"S: Strong Appeal/ 5 touch of provocative sensuality lets us play with lace, sheer fabrics, transparencies and softness. 2il" and cotton bring sophistication to homewear ideas. $nderwear: The 1ndercolors of Benetton winter season opens with a cosy, supremely comfortable collection and a s"ilful use of every "ind of cotton. @ew features include a greater number of organic cotton ,ersey articlesA a special focus on the brand8s ;@5 9with a logo print motif in bright colours:A and a new bra designed especially for teens. Basic/ 1ndercolors of Benetton always dedicates special attention to its underwear proposals, even those that are commonly defined as BbasicC, but whose simplicity, clean lines and colour palette ma"e them indispensable. In fact, in a colour palette limited to white, blac" and flesh tone, a small world of bras, panties, culottes, brassieres, tops and slips has been created.

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%ifestyle is a collection of surprises created by Benetton to satisfy everyone)s tastes and needs. It concludes e4clusive fragrancesA sunglasses and eyewear frames for men, women and childrenA luggage sets for all travel needsA lots of stationery ideas for schoolA proposals of every "ind for our home. 7erde8"osso8Giallo8Blu8$nited .%ragrances1 : Benetton is colour/ colour celebrating the diversity of the world, colour spea"ing to every culture, colour as a universal means of communication. +olour as passion, as instinct, as something to which we all share the same spontaneous human response.

%i"e colour, fragrance is a universal language, communicating through intuition, emotion and evocation. @ow colour and fragrance come together in a collection of scents inspired by Benetton)s legacy D a legacy of creativity, universality and youthfulness, with colour at its heart. 5 collection of four perfumes representing an homage to Benetton)s history and presence, inspired by the iconic colours and the wool stitch ' timeless elements of the brand)s ;@5. Adult 4yewear/ lamour and originality distinguish 1nited +olors of Benetton eyewear. 5 wide range of frames with all the colour, energy and comfort you would e4pect from Benetton. Adult Sunglasses: The 1nited +olors of Benetton sunglasses are coloured according to tradition/ trendy but without going to e4tremes. It is a collection with wrap'around frames and shaded lenses for uni0ue and unmista"eable proposals. ,id 4yewear: The 1nited +olors of Benetton "ids eyewear collection is characteri3ed by da33ling combinations of warm tones of red, orange and pin", complimented by colder spar"ling shades in white and light blue. 2hapes are inspired by both the adult eyewear collection and the Benetton apparel lines. The 1nited +olors of Benetton "ids frames are light and comfortable, and the bright colors and decorative detail ensure this eyewear is both fun and practical for "ids to wear. ,id Sunglasses: The simple and brightly coloured 1nited +olors of Benetton sunglasses maintain the balance between style and health, one of the collection8s strong points, with very high 0uality lenses and ,aunty frames. *ra9el Bags/

1nited +olors of Benetton luggage will ma"e us conveniently travel in comfort and style, accompanied by the latest in technological design wherever we go. They are meant for a traveller, pleasure'see"ing tourist or adventurous e4plorer.They are available in a wide variety ranging from ergonomic handles to smooth wheels and hard'wearing material goes hand in hand with a wide range of colours. H)&4 !)LL4!*-)#: Bed Linen: 1+B helps us to e4perience the fun of choosing from the Benetton Bedlinen +ollection and light up our night with colours and cheerful super'softness. *erryclot': 1+B has introduced new colour combinations, uni0ue patterns and cloud'soft velour fabrics, the $#1# Benetton Terrycloth +ollection which will certainly freshen up the summer.In the bathroom, one can en,oy wrapping him<her in colours and stripes with 1+B8s -new sunnyrobes, or pamper at the spa with the softness of the -honey whippy- +ollection.

?hether soccer fan or simply outdoor sports lover, "ids are sure to find their match this year with the -soccer- or -blooming world- towels and robes. +onceived for the most loyal and sophisticated 1nited +olors of Benetton fans, -face$face- and -native- beach towels not only feature attractive colour combinations and innovative prints but also uni0ue weaving techni0ues. Garden !us'ions:
1+B brings fresh colour to our garden with the new cushion collection .?hether the preference is for stripes, chec"s or floral prints, this new line is an invitation to en,oy some 0uality time, rela4ing under the clear blue s"y.

*a le *op/ 6eaturing the latest trends and cutting edge designs, the new 1nited +olors of Benetton Tabletop melamine collection is a great way to give dinners, parties or picnics a fresh new,

carefree touch. 5vailable in multiple colour combinations, the ,ugs, glasses, mats and trays are perfect for use anywhere from the garden to the "itchen or even the beach.

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5 wide range of colourful items for writing and studying is available.

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Benetton roup 9the -.arent +ompany-: and its subsidiary companies primarily manufacture and mar"et fashion apparel in wool, cotton and woven fabrics, as well as leisurewear. The manufacture of finished articles from raw materials is underta"en partly within the roup and partly using subcontractors, whereas selling is carried out through an e4tensive commercial networ" both in Italy and abroad, consisting mainly of stores operated and owned by third parties. "eturn Policy: 1nworn, full priced merchandise with tags attached and accompanied by the original receipt can be e4changed within 1E days at the store of purchase. There will be no refunds or store credit. 5ll sale merchandise is final sale. 6or hygenic reasons all sale of underwear and inner garment are final, returns or e4change of these items will not be permitted. .ayments made by +redit +ard, will receive the applicable amount credited to the card account within 1E wor"ing days .

!ollections Structure:

6le4ible and segmented structure has also been introduced for 1+B "ids, 2isley and .laylife proposals, adapting the commercial calendar to their specific positioning. 1+B collections, both 2pring<2ummer and 5utumn<?inter, are now more structured and modular, with several proposals to guarantee fre0uent in'season deliveries to our store networ". =ach collection is characteri3ed by different proposals with several themes, offering products sensitive to mar"et trends and fashion moods and ma4imising stores) attractiveness, in order to satisfy the re0uirements of the most demanding customers. The structure also involves a segment of products "nown as !apsule, capable of presenting fashion'forward garments and accessories at any time during the season. !oreover 1+B offers additional service to the networ" with !ontinuati9e -tems, which ensure that collection)s core products are restoc"ed as 0uic"ly as possible. Frders for these products are entered directly, and as the information systems of the production and logistics units are lin"ed, the system provides immediate confirmation and guaranteed delivery times 9first in, first out:.

Latest Promotional Acti9ity : L$!,6 6)$ 6rom &# Fctober $#1#, customers purchasing in a single transaction three items from the 1nited +olors of Benetton BToddlerC and BGidC 9from si3e HE to II%: lines among those mar"ed with the special %1+G> >F1 stic"er will receive the cheapest item free 9sub,ect to availability in'store at the moment of purchase:. The promotion will be valid at participating B1nited +olors of BenettonC stores, displaying the special B1nited +olors of Benetton. %uc"y youC advertising posters.

The 1+B8s product merchandising policy is also important in its success because they emphasi3ed a climate of scarcity and opportunity. 2o, its consumers "now that if they li"e something, they must buy it in this moment and not later. 5ll these characteristics ma"es 1+B a business model difficult to imitate and for this reason its competitive advantages are more sustainable. In conclusion, Benetton uses "nowledge management to balance structure and creativity. They recogni3e that both creativity and structure is crucial in ensuring the success of the venture.