MAF 661 STRATEGIC MANAGEMENT

WEEK WITHOUT WALL (TENFOLD ORGANIC TEXTILES)

QUESTION 5 (20 marks)
Using four criteria of sustainable competitive advantage, discuss whether organic
apparel strategy of Tenfold Organic Textiles is a sustainable competitive advantage in
the long run perspective.

Sustainable competitive advantage are required for a company to thrive in today’s

global environment. It is the key to business success that enables a business to have greater
focus, more sales, better profit margins and higher customer and staff retention than
competitors. In other word, it also a long run-term business value. There are three key types
of sustainable competitive advantage which are; cost advantage, value advantage and focus
advantage. Firm will derives a sustainable competitive advantage if one of these three key
types is met. Therefore, for the firm that have a resources with the potential for a sustainable
competitive advantage, it must have four criteria; valuable, rare, costly or difficult to imitate
and non-substitutable.

First, the resources must be valuable in the sense that it exploits opportunities or
neutralizes threats in the firm’s environment. It also can be valuable in formulating and
implementing strategies to improve efficiency or effectiveness. According to organic apparel
strategy of Tenfold Organic Textiles which the company want to focus on organic apparel
using naturally dyed fibres and organic fabric, it is actually have the valuable criteria. The
company’s goal is to position themselves (Tenfold) as the most “sustainable” brand in the
organic category. They believe being the first to deliver colour without synthetic chemicals will
help to differentiate its brand in the sense that they have an environmentally responsible
offerings. They exploit opportunities by creating a design to win customers as an apparel brand
that are fashionable and up-to-date, as well as a provider of an environmentally responsible
and healthier solution. Tenfold also implement strategies at which they emphasis accessible
in terms of price when they wanted to create something or design products. Tenfold have one
of those three key types of sustainable competitive advantage which is value advantage that
business provides a differentiated offering that is perceived to be of superior value. In this
context, Tenfold have positive environmental impact because they are using 100% natural
plants and minerals to dye and process the fabrics. Hence, the valuable criteria is met.
 Second, the resources or strategy must be rare among the firm’s current and potential
competitors. If competitors or potential competitors also possess the same valuable resource,
it is not a source of a competitive advantage because all of these firms have the capability to
exploit that resources or strategy in the same way. Rare in other word, it must be uncommon;
difficult to exploit to other competitors. Here, based on organic apparel strategy of Tenfold
they are building organic product from farm to garment, and looking at all steps of the life cycle
of a garment. They realize that more than 30% of the toxicity of a garment happens after
customer take it home. To overcome this problem, they develop a strategy to help consumers
reduce their own impact of the toxicity by providing them with Soap Nuts. Soap Nuts is use to
eliminate the toxic detergents that are being used as well as reducing the impact on the plant.
Therefore, it is rare because not all the company is formulate and develop such strategy by
providing a soap to reduce toxicity of a garment.

Next, as the apparel strategy is using 100% organic cotton fabrics and natural dyes to
their products, it is difficult to imitate. Inimitability is a key to value creation because it
constrains competition. If the resource is inimitable, then any profits generated are more likely
to be sustainable. To reduce the possibility that competitors can easily copy the products, firm
can developing strategies around resources that have at least one of the following four
characteristics; physical uniqueness, path dependency, causal ambiguity and social
complexity. Path dependency is a characteristic of resources that is developed or accumulated
through a unique series of event. Competitors cannot go out and buy these resources quickly
and easily; they must built up over time in ways that are difficult to accelerate. Here, organic
must be grown organically for three years before it can be sold as organic. It takes quite long
time to competitors to get the same resources. Apart from that, Tenfold is committed to using
natural herbal dyes that can come from plant, animal or mineral resources which is this kind
of resources is difficult to get and imitate. Tenfold explore all around the world to discover a
company (Aura Herbal Wear) that could dye organic cotton and fabrics in large volume without
a loss in quality. This is somewhat Tenfold have the physical uniqueness because the
relationship with Aura they have the ability to create organic textile products that deliver the
key environmental benefits. Tenfold also have the exclusive rights and access to the Aura’s
natural dye process, which eliminates the need for chemicals in textile. Other competitors does
not have this exclusiveness right and benefit then it is difficult to imitate their products.

Last criteria is non-substitutable which there must be no strategically equivalent

valuable resources that are themselves not rare or inimitable. In this case, as Tenfold is
committed towards its natural herbal dyes and using 100% cotton fabrics to produce their
products, they have the “sustainability” brand in the market. This is because even though there
are a few competitors in the market producing organic apparel but they are made with the
chemicals, in other word, they are using synthetics dyes on their fabrics. In this context,
Tenfold believe that they are the first brand that producing overall organic and natural
resources. Thus, other competitors are lack the technical ability to produce organically dyed
fabrics without using chemicals. Moreover, Tenfold’s market strategy to distribute their product
line through speciality boutiques and select department stores because of their ability to
communicate the unique benefits of the brand directly to consumers. Apart from this, Tenfold
not only focus on producing organic apparel, but they also focus on made their packaging as
eco-friendly as possible whereby all of this strategies give them a non-substitutable criteria.

In order for the firm to attain competitive advantages that are sustainable over time, all
four criteria must be met. When the resources or strategy do not meet any of the four criteria,
it would be difficult to develop any type of competitive advantage. As discuss above, Tenfold
organic strategy have met all of four criteria of sustainable competitive advantage, therefore it
can be sustainable competitive advantage in the long run perspective.