Welkom in Den Haag, het meest koninklijke en politieke centrum van Nederland!

Den Haag is a city near the Western Sea Side, the seat of Netherlandish Government, Binnenhof (the Parliament) and the International Court of Justice, home to half a million citizens and the King himself.

This morning we had to get up quite early. Nevertheless our group was looking forward to today’s program: Den Haag is calling! As there have been some spontaneous changes in the agenda, we had to improvise a little during the briefing. Before getting into the train everyone had time to catch a hot awakening coffee. While traveling to Den Haag we could enjoy the beautiful landscape.

Welcome to the Netherlandish Court of Audit (Welkom bij de Algemene Rekenkamer)! We were instructed about the autonomous government organ (Hoog College van Staat), whose task is to audit how the Netherland’s ministries spend the revenues. These are provided by the Netherlandish tax payers. Our hosts,  Maaike Damen, Jost van Hofwegen (Research and Audit Director), Martin Dees, Gijs Koop (Senior Researcher), Rudi Turksema, Maarten de Jong started with a couple of key facts about the Court of Audit. They underlined that it is important that public spending is more than just finances, it also impacts the environment. The Netherlands recognized that impact very early and implemented the Court of Audits in their constitution in 1814 as a counterweight to the government. The Netherlandish law secures that; Cooperation is mandatory for all governmental bodies as the likes of ministries. They have to provide the Court of Audits with all the financial information they ask for. Other bodies are audited as well, Quasi Non-Governmental Organisations (QUANGOS) for example. Digitalization, which were also discussed on Monday and Tuesday (of our Study Trip), also takes place in the Algemene Rekenkamer. Accounting and audit are more and more shifted into a digital form. However, there’s a lack of qualified personnel in the field of IT and programming such systems in the Netherlands. Therefore the few people available in this branch were invited to an accountability-hack (a kind of competition who can program the best accounting-system). The Court of Audit’s internal personnel was trained in IT as well. Structuration and automation were the goals of these actions. On the other hand, the more data is collected, the more difficult it is, to handle. Therefore, complexity, data ethics and security are the downside/challanges of this digitalization-trend. Untypical for an innovative country like the Netherlands is, that on central government level, still the simplified version of cash accounting is in use (in which expenses and revenues are taken into account when they are paid, not when they occur). While the OECD encourages accrual accounting, the European Union (EU) makes no progresses in invoking the much rumored EPSAS (European Public Sector Accounting Standards), which would have that and other detailed accounting regulations in write. The EU was a target of justified critics this morning, as its suboptimal revenue-collection and redistribution was addressed as well. Finally, the New Public Management approach of output-oriented budgeting was discussed in a critical manner as well.

We enjoyed having our delicious lunch in the historical center of Den Haag.

Welkom bij het ministerie van Financiën (Welcome to the Ministry of Finance)!

First we got background information from Bart about the tax and customs administrations and the organization of the tax collection. He pointed out also several deficiencies. The most important ones were legacy, management-information and strategic personal planning. He then presented Moore’s strategic triangle and encouraged the students to map the challenges of the Tax and Customs Administration by refering to that framework to cut through the complexity of the organization.

Bert Kloster, International Affairs, talked to us about the international strategy and cooperation against tax avoidance. He pointed out that internationalization and globalization cleared the path for multinational companies to avoid taxes.

In the meantime new sources of information like social media and Internet in general changed the people’s expectations about the government’s institutions. More precisely, transparency has become more and more important to ensure the high compliance of civil taxpayers in the Netherlands and the G20 countries. The OECD BEPS (Base Erosion and Profit Shifting) replaced the system of earlier, mostly bilateral, tax treaties. These bilateral treaties had been used as a playground. Some multinational companies even shaped their business structures in a way that no or very little tax had to be paid. According to Bert, not only the developed countries suffered from tax avoidance. Also, developing countries like Ghana and Malawi did not receive the amount of taxes they should have. These countries did not have the resources (HR or financial) to deal with the taxing duties of multinational companies. BEPS made it possible not only for the G20 to take in the guidance of OECD into their national legislation, it also provided practical help and technical assistance for developing countries, which originally felt the negative consequences of BEPS.

Well-dressed in front of the Dutch Ministry of Finance

Utrecht: An example of innovation, growth and openness

The 08:16 intercity train from Amsterdam Centraal took us almost straight to the door of the Utrecht municipality building where an interesting half day with the CFO of Utrecht was awaiting us. The municipality decided to move to this very central location to be more prominent and accessible for the public. The building from 2014 is light and open – even though it is constructed from more steel than the Eiffel tower as we would learn later during our tour.

Frank Halsema, CFO of Utrecht, welcomed us with coffee, cake and an introductory presentation on the city of Utrecht. Utrecht is the 4th largest city in the Netherlands with approximately 350’000 inhabitants and an expected growth of 20% in the next 15 years. “The city of growth”, “the city of work” and “the city of bicycles” has a long history starting 50 years a.c. and is proud of its heritage with the tallest dome tower in the Netherlands (112m) but also its modern status with the biggest bike parking in Europe (12’500 bikes) and its healthy urban living vision (video on youtube).

Frank Halsema, CFO of Utrecht, giving his introductory presentation

The morning continued with Jasper Woelfjes, tax expert for the municipality who gave us some insight into the specialities of their system compared with the Swiss system. Only 3.5% of taxation is done on municipality level whereas 95% is taxed by the national government. This and the system of the municipality fund with 60 criteria defining who receives how much budget gives the municipalities much less autonomy than Swiss municipalities. If the national government does not spend enough money, then the municipalities also receive less spending money – the frustration on this point was noticeable and the Swiss system preferable in the eyes of the Utrecht financial experts. Furthermore, municipalities cannot define new taxation methods for their citizens, these are also defined on national level. However, in the municipality of Utrecht a group of businesses approached the taxation office and requested an increase in taxes of 11.1% to create a business fund which is then reinvested in community projects in the regions the businesses are active in. And the bottom line of the budget: always 0. Revenue has to equal expenses.

A second Frank then gave us a tour of the building. The building is situated on the “other” side of the railway station – previously no-mans-land, now becoming the new city centre. The first six floors of the building are open plan and can by used by the public for studying, working and marrying. The other 15 floors are occupied by the municipality. The views across Utrecht from the 21st floor, where we spent most of our time, were spectacular – even in the rain.

City model of Utrecht being explained by the second Frank

Auke Timmerman, business controller for the work & income unit, took us on a simulated retreat of the council of the mayor and aldermen of Utrecht. Part of their yearly planning cycle is the spring note where they discuss and negotiate the use of the yearly allocated revenue for the next year. In five groups representing the mayor and four aldermen we made proposals to adapt the budget to meet the final goal of having zero difference between revenue and expenses. The aim: “everybody has to leave the building as a winner”. The reduction of the budget for sports fields expansions and the Vuelta which passes Utrecht in 2020 were measures to achieve this aim.

The council of mayor and aldermen trying to solve the budget challenges

Last but not least the CFO gave us an insight into their digitalisation journey. After nearly killing the internet for the entire city of Utrecht with their blockchain project in 2017 the aim this year is to fully digitally check the flow of the 1.49 billion Euro municipality budget by the end of this year “met een druk op de knop”.

After saying goodbye to our great hosts most of us took a walk through the old city of Utrecht, which is beautiful even in the rain. This evening our group will meet at Cafe de Kroon in Amsterdam for an informal get-together.

Beautiful old city of Utrecht in the rain

20 million smart children and 1 smart city

38% of children worldwide do not complete basic education. Today, Wendy, Livia and Shirin from the NGO Aflatoun gave us an introduction into how their organization fights against that fact and helps children and young adults all over the globe to improve their livelihoods. Aflatoun’s methodology follows the «train the trainer» approach: By providing local partner organizations and government institutions with their curricula and services, the NGO aims at giving the beneficiaries a better self-image, promoting their critical thinking, raising awareness about their rights, and fosters their entrepreneurial attitude. In collaboration with partners and stakeholders, Aflatoun adapts their curricula according to local contexts, which allows them to be active in more than 100 countries. Depending on their financial capacity, the organization started to charge their partners for these services and thus considers itself nowadays a social enterprise rather than an NGO. Surprisingly, the great majority of partners did not seem to mind the change of business model and are willing to pay a licence fee for accessing the Aflatoun curricula. The organization acts as a hybrid of an NGO and a private business, which is exemplary for the transformation the world of international development is going through. The traditional way of raising funds solely through donations becomes harder to walk with a rising number of competing organizations entering a stagnant donor market. Modern organization need to find alternative ways to fund their projects if they want to keep up the quality of their work. In the case of Aflatoun, their transformation to a social enterprise comes with high ambitions: In 2020 the organization aims at delivering their programs to 20 million children.

Introduction into the working practices of Aflatoun

For our second visit of the day, we were welcomed by Marije Poel at the Smart City Academy of the Hogeschool van Amsterdam. The afternoon was insightful: we learnt that our colleague Bettina sneezes every morning after waking up and that the city of Amsterdam is turning its roofs blue-green. Relying on a bottom-up approach, Smart City Amsterdam stimulates small businesses to make the metropolitan area economically, ecologically, and socially future-proof. The Smart City Academy supports these developments in several ways: it develops expertise, connects stakeholders to exchange their knowledge, acts as a portal to other Smart Cities worldwide, and implements education programs in the fields of Smart City. Marije presented three specific Smart City projects, for us to better understand how this buzzword translates to the real Amsterdam. Through the project Resilio, the city wants to encourage citizens and investors to turn their roofs into urban gardens and water storages. In terms of environmental protection and economical use of resources such as energy and water, a lot can be gained. Green-blue roofs save energy by insulating houses and add to the quality of life in the city. In a group exercise, we had the chance to brainstorm about ways to involve citizens in the implementation of this project and business models that can make this approach economically feasible.

Group discussion at the Hogeschool van Amsterdam

Day 2 marked the end of the Smart City-focus of our study trip. For the remaining 3 days, we are excited to learn about Public Financial Management in the Netherlands and to excursions to Utrecht and Den Haag. Stay tuned!

As representation for the expedition team, Alissa Brenn, Svenja Hofmann and Chantal Menzi

A specter is haunting Europe — the specter of Smart City

On a typical autumn day at the beginning of September, about 20 students met in a bright, old-fashioned coffee house. Only a few steps away from Amsterdam Zoo. And this closeness has a truly symbolic character. Because on this day the group is trying to trace an exotic-sounding organism. The Smart City Amsterdam. At this first meeting in the city on the shores of the river Amsel, a short briefing was held on the forthcoming mission. It quickly became clear that if the group wanted to learn something about this Smart City Amsterdam, first the ecosystem in which this idea occured had to be studied in depth.

As soon as all had their coffee, the group went to the centre of the city, where the students had arranged to meet someone who might be able to help them analyse the Amsterdam ecosystem. Once there at the Dam Square, the temporary city researchers were immediately greeted warmly by Leonie, who invited the group on a city tour.

The tour with a focus on the historical and social conditions that shaped the city, started directly in front of the National Monument, that was built to keep in memory the suffering of WW2. The students learnt a lot about the role of the Netherlands during the time of war and especially about the probably unparalleled economic rise of this legendary trading city in the 17th century. Additionally, interesting background information ranging from business and architecture to local traditions and cuisine were given to the group.

With each new insight, the understanding of the conditions under which this Smart City seems to thrive grew. The sophisticated art with which the city tames the water suggests that there must be a very innovative climate in this urban area. The peculiarity that everyone in this city can look into each others home and that very liberal and open minded image that is being cultivated suggests that cooperation and participation seems to be welcomed by the residents. And last but not least, a look at the traditional menu reveals real pragmatism in action.

Shortly before the tour was over, a phone rang. Someone supposedly spotted the Smart City Amsterdam near the harbour. For everyone it was immediately clear: Now or never. The measuring instruments were quickly calibrated and the meshes in the net were checked one last time. There was no time to lose.

On a former harbour area, very close to the shipping museum, the group finally found what they were looking for. After a short wandering on the winding terrain, the Smart City Amsterdam revealed itself to the students in the shape of an open door.

As the curious group members stepped through the door, they were warmly greeted by Cornelia. Cornelia works for the organisation Smart City Amsterdam, an organisation which acts kind like the brain of the hole Smart City by connecting the different parts of the organism. In the following hour and a half Cornelia explained to the students what the Smart City Amsterdam is or rather what it is about to become.

The term Smart City probably has more definitions than there are cities that want to become smart. However, as the lowest common denominator, it can be said that Smart City is an answer to the increasingly complex challenges faced by large cities today. After all, more than 50% of the world’s population lives in cities – and according to the United Nations this trend continues to rise.

Where many people come together, traffic problems are usually not far. The danger of accelerating climate change, on the other hand, calls for a rapid rethinking of the way we use our resources in general – especially in terms of energy supply. And last but not least, large cities are struggling with the atomisation of society and the increasing alienation of the population from the public institutions. Smart City is intended to be a solution to at least one of these challenges – but usually for several at the same time.

On the one hand, the technologies available today are to be used for sustainable urban development and, at the same time, the collective intelligence of the urban population, businesses, science and government agencies is to be transformed into innovative solutions via collaborative processes. However, different smart city approaches are used around Europe. So also Amsterdam has its own idea, what a smart city is about.

For Amsterdam, Smart City means being economically strong and sustainable at the same time. The programme focuses on the four themes (1) energy, (2) digital city, (3) circular city and (4) mobility. To make progress in these areas, Amsterdam has designed its Smart Governance around a specially founded organisation which acts as kind of a Network Administrative Organisation (NAO). It coordinates the various activities of the actors involved, helps with networking and thus promotes collaboration within the network.

The two essential spheres of Smart City Amsterdam are: The Public Private Partnership and the Smart City Platform. The Public Private Partnership consists of governments (e.g. City of Amsterdam), knowledge institutions (e.g. Hogeschool van Amsterdam), companies (e.g. Eurofiber) and civil organisations like foundations. These partnerships are particularly about sharing resources and jointly initiating smart projects.

The platform in turn is intended for the entire Smart City community. This platform should enable collaboration and participation of as many stakeholders as possible. So far, almost 7,000 people have registered. On the platform projects can be presented, event suggestions can be posted and discussions about the desirable further development of Smart City Amsterdam are held.

Fortunately, the interested listeners were able to ask questions at any time and so the students more and more managed to understand this new and special Smart City phenomenon. Even though some terms might not have been fully clarified by the end, it was a very enlightening encounter for the group. And a successful prelude to further research on Smart City Amsterdam.

As representation for the expedition team, Fabian Annaheim, Fabio Brändle und Kevin Andermatt

Further information:

Amsterdam Smart City: https://amsterdamsmartcity.com/

MSc PNP Study Trip to the Netherlands ~2019~

Before entering the final year of their studies, the MSc Students majoring in Public and Nonprofit Management traditionally embark on a one-week study trip to gain practical insights and discuss contemporary trends and challenges with high-level public sector managers, government officials and practitioners.

This year’s study trip goes to the Netherlands and the students will learn about the development and implementation of ‚Smart City’ agendas, the management of respective projects and trends in the digitalization of public administration. Another focus is on the management of financial resources at local and central government level as well as in NGOs. Given that public and nonprofit organizations are unlike corporates not ultimately aiming for revenue maximization and profit margins and rather strive for public value creation and/or societal impact, other performance measurement indicators, management instruments and processes are required. In line with these topics, the students is awaiting a series of interesting and hopefully inspiring meetings and presentations. During the next week, the students will take over this blog and share their impressions and learnings.

Approaching Amsterdam / The Netherlands from above with water, dikes and an onshore wind farm.

SML Study Trip 2019: China and Vietnam

China is situated in Eastern Asia on the Western shore of the Pacific Ocean and encompasses an area of 9.6 million square kilometers. China’s continental coastline extends along 18,000 kilometers, and its vast sea surface is studded with more than 5,000 islands. More than 1.4 billion people live in China. In 1949, the Communist Party of China established the People’s Republic of China.

Thanks to its reform and opening-up policy in 1978, China has become stronger and stronger in economy, science and technology. The nation’s economy has been growing rapidly. China’s economy is gradually shifting from a merely production-oriented to an innovation-led economy. Thus, the Chinese markets will continue to open up and Chinese companies will internationalize as Western companies will explore China as a future market and supply source to an even greater extent.

China is the world’s largest manufacturing economy and exporter of goods. It is also the world’s fastest-growing consumer market and second-largest importer of goods. China is a net importer of services products. It is the largest trading nation in the world and plays a prominent role in international trade and has increasingly engaged in trade organizations and treaties in recent years. China became a member of the World Trade Organization in 2001. Major projects such as the Belt and Road Initiative are testimonial to China’s long-range plan to play a pivotal role on the geo-political world stage.

Vietnam is the easternmost country on the Indochina Peninsula in Southeast Asia and is bordered by China to the north. 96 million people live in Vietnam. Its capital city is Hanoi.

Vietnam was part of Imperial China for over a millennium, from 111 BC to AD 939. An independent Vietnamese state was formed in 939.The nation expanded geographically and politically into Southeast Asia, until the Indochina Peninsula was colonized by the French in the mid-19th century. Following a Japanese occupation in the 1940s, the Vietnamese fought French rule in the First Indochina War, eventually expelling the French in 1954. Thereafter, Vietnam was divided politically into two rival states, North and South Vietnam. Conflict between the two sides intensified in what is known as the Vietnam War. The war ended with a North Vietnamese victory in 1975.

Vietnam was then unified under a communist government but remained. In 1986, the government initiated a series of economic and political reforms which began Vietnam’s path towards integration into the world economy. By 2000, it had established diplomatic relations with all nations. Since 2000, Vietnam’s economic growth rate has been among the highest in the world. Its successful economic reforms resulted in its joining the World Trade Organization in 2007.

Students in their final semester at the ZHAW School of Management and Law (SML) embark on this study trip to China and Vietnam following attendance of the seminar “Doing business in Emerging Markets”. The objectives of this study trip are:

  • Experience the Chinese and Vietnamese way of life through real on-site exploration
  • Explore the cultural heritage and learn how to integrate the findings into doing business in emerging markets
  • Understand the economic thrust of China and Vietnam and its neighboring countries
  • Learn the first steps to expand one’s individual business network beyond Switzerland
  • Expand the horizon for a future professional career.

My heartfelt thanks goes to all organizations, companies and business partners in China and Vietnam who generously invited our SML student group. We deeply appreciate your support.

Moreover, I would like to thank the entire student group who co-organized this trip and in particular the core organizing team Fredrik Rüegg (CEO), Jasmin Schleeh (CTO) and Nicola Zimmermann (CFO). We are all looking forward to this no doubt rewarding and memorable journey.

Best wishes

Dr. Markus Braun

ZHAW School of Management and Law / Zurich University of Applied Sciences

Brussels on two wheels

Bike-sharing in a nutshell

Exploring a new city while simultaneously getting from point A to B is an ideal form of mobility for the broader public. Specially for foreigners to do some physical activity and to actively participate in the daily life of locals, transmits special experience.

The bike sharing system is currently well-established around the globe and particularly convenient in larger cities. Additionally, in times of increased global warming and awareness for the environment, the idea of bike sharing is becoming more and more attractive. And Brussels with its Dutch influence seems to be a suitable market for this kind of business.

The reality test

We have explored the city ourselves by making use of the bike sharing concept Villo, which is one of the four options to rent a bike. Villo started 2009 as a cooperation between Brussels-Capital region and JCDecaux Group (multinational cooperation for public bike rental systems). The service is well-established with rental stations in all 19 districts of Brussels providing 5,000 bikes.

However, as non-cardholders of Villo, the current bike-sharing service revealed to be very inconvenient for tourists. The rental process is lengthy, barely readable, unclear, using a highly outdated software.

Apart from our experience, a local user explained to be satisfied with the service and frequently makes use of it. Being a “super-user”, he also benefits from incentives in the form of additional free-riding minutes. Furthermore, he reported that there is almost never a shortage in bikes. This is in line with what we have observed at four stations that mostly all bikes were available.

Overall, one can observe that bikes are not as popular in the streets of Brussels as they are in other Nordic cities. Whereas apparently the electric scooters have a higher demand due to their convenience with a flexible, digital rental process. In terms of market competition, these other transport options need to be considered.

The bike-sharing of tomorrow

The current bike-sharing rental service in Brussels is well-established but according to our observation, there is some room for improvement and innovation. When entering the market in Brussels, one should consider a rental service convenient and easily accessible to locals but also tourists. Meaning to offer a service that is easy and fast also for occasional users. A new market entrant should focus on a more digitalized service to differentiate from current providers and add attractiveness and flexibility. Additionally, strategic alliances with tour agencies and local volunteer tour guides are recommended, as it could open up new business ideas. Furthermore, partnering with the Bike Committee in Brussels can open new doors. In terms of location, the bikes should be spread throught the 19 districts including residential areas.

Although the market seems saturated, there is still market potential by offering  user-friendly services. For instance, as a new entrant one could provide a customer-oriented rental service. This would motivate more people to change to a more sustainable and convenient way of transportation.


Pick up and let’s explore
Go local and target waffles!





Swiss High-End Watches in Brussels

Brussels is famous for its market place and the “Galeries Royals St Hubert”. Luxury goods such as jewelry, diamonds, watches and chocolate are sold all around this place. Rue Neuve is the most famous and prestigious shopping street in Brussels with 43’000 visitors every day. However, luxury brands must share the street with more casual and low-priced brands such as H&M, Zara and Uniqlo; hence, the luxurious and glamourous flair is compromised and not as dominant as in the “Galeries Royals St. Hubert”. Based on our observations, Swiss watch brands seem to be present in Brussels mainly through high-end retail stores and jewelers. We did not find any mono brand stores of luxury watch brands. Consequently, to establish a strong market presence and perception among potential customers and to differentiate from already established competitors, a mono brand store could be opened. Preferably in the “Galeries Royals St. Hubert” as it is one of the most visited places for luxury products in Brussels. Even though there is no space available now and the rents are immense, it is still concluded that it is the main place to position a Swiss high-end watch brand in Brussels.

Already established partnerships with retailers do not need to be terminated, since it is recommended to the Swiss watch company to open a mono brand store. The store could function as a flagship store and marketing tool to attract new customers. It should offer a small and exquisite assortment of watches that complements the offering of retail stores and does not compromise it. Furthermore, through the mono brand store the watch brand can offer the ever-important customer experience that is essential to the majority of high-end watch buyers. Through own stores the company can better communicate its values and understanding of the meaning of luxury. Additionally, it is easier to build and foster relationships with clients. Particularly in the high-end watch industry, where customer loyalty is comparably high, a strong bond between the brand and the client can lead to long-lasting relationships. Mono brand stores allow a certain brand to offer complementary after sales services. An additional benefit to the customer and chance to improve the customer-brand relationship for the company.

Competition in this area is existing since mainly Yvan’s Jewelry store is located thereby too and sells various luxurious watches such as Rolex, Longines, Vacherin Constantin and Tudor. In general, competition is relatively high. The usual suspects when it comes to luxury watches such as Rolex, IWC, Omega, Hublot and Patek Philippe are all present. However, the domestic high-end watch industry is basically nonexistent. To further establish a strong position in the market and increase brand recognition and customer experience, cooperations with existing companies such as luxurious chocolate stores could be established in the early phase of the market entry efforts.

To summarize our findings, we can definitely say that there is room and potential for further luxury watch stores. Even though the competition is rather high, the lack of mono brand stores opens up opportunities for new concepts to convince new possible customers.

#Turning Brussels On

On is a Swiss sports shoe brand looking to internationalize into different European markets, with Brussels being the centre of the EU, offering great potential for On to expand to. On is a pioneering sports shoe with innovative disrupting comfort technology changing the running shoe game!

Qu’en est-il de Bruxelles?

The Region around Brussel is surrounded with idyllic green spaces offering the perfect opportunity for Joggers to go for a run. According to Brussels Express, 54.4% of Belgium’s capital is made up of green space. This figure presents more green spaces than other major cities such as London and Berlin.

The average salary in Brussels is 3908€ per month, as of July 2016. Having a relatively above average salary, the population in Brussel can actually afford buying the premium quality running shoe.

Brussels is the ideal spot for sports enthusiast, hosting the Tour de France as well as a city marathon in October. The marathon could present the perfect opportunity for runners to show their On shoes and leave the competition behind. In general, the capital of Belgium is known for a healthy lifestyle, a trend which absolutely agrees with the philosophy of the Swiss company.

Centre

Location & surrounding gyms

Having walked the streets of Brussels, we found the ideal spot for On to showcase their shoes. Positioned in the heart of the city in perfect surrounding of other stores, tourists as well as local people will be exposed to On. This busy part of the city will be perfect to give the brand the most exposure as it is very unknown to the country yet.

This has been the result of multiple interviews which were conducted with pedestrians as well as store managers.

By choosing this location the main objective will be to increase the brand awareness.

Proposed store location & consulting team

La situation du marché

The mainstream players in the sporting goods market are represented however there is still the great potential in the niche market for a premium sports shoe brand like On.

On offers a shoe that is appealing to a wide range of consumers by offering a broad variety of colours and designs, however keeping a unique look. Even though it is on the upper range price wise compared to the other major sporting brands, it is not classified as a luxury brand. “The young generation looks more towards style than comfort” says the store manager of Nike here in Brussels.

“The young generation looks more towards style than comfort.”

Nike store manager
Interview on 24th March 2019

However, On aims to disrupt this by designing a stylish and comfortable shoe, giving joggers the feeling of running on clouds.

Running on Clouds in Brussels

Having analysed the market potential in Brussels with regard to jogging equipment we confidently believe that on can make great strides by opening another flagship store in Brussels.

Capture of the team #workinghard

#Michelle #Brian #Vlada #Pascal #Amanda #Luca

Premium fashion brands for men in Brussels

The local fashion and retail market in Brussels have seen excellent growth potential over the last decades. Brussels population profits from being the heart of the European Union and therefore has one of the highest disposable income rates in Europe. Consumers in Brussels favor are purchasing their luxury goods in main street shops which accounts for more than half of the sales rather than shopping centers. As Brussels counts numerous European Union institutions, there is always a high demand for premium business suits for politicians but also businessmen which makes it the ideal city to establish Jizoku to cater to the local demand. (Baheux, Van Doorslaer, & Van Meerbeck, 2016)

Scabal,
Boulevard de Waterloo

As one of the major cities in Europe, Brussels shows a highly competitive retail market, has however lost its attractiveness over the last view years for the luxury segment (Baheux et al., 2016; Delguste, 2017). As a luxury clothing brand for men, the positioning is in the higher price segment targeting businessmen with a keen interest in pursuing a sustainable lifestyle (CSCP, 2012). Customers, awareness for sustainability and readiness to pay a surplus for environmentally friendly brands show market potential in the luxury segment in Brussels.

The Boulevard de Waterloo in Brussels is the most suitable location to set up the store for Jizoku. The boulevard already hosts the most reputable premium brands such as Moncler, Gucci or Boss which makes it the right spot for Jizoku to appeal to its customers and create an authentic and premium shopping experience. Furthermore, it is recommended to open the store on the appropriate side of the street, where all the luxury brands have their stores.  (Mason, 2019)

Armani,
Boulevard de Waterloo

On the one hand, the brand faces global luxury clothing competitors such as Hugo Boss, Armani Fashion, Hackett London and Scabal. On the other side, however, brands advertising with highly sustainable clothing in men’s fashion are more active in casual clothing or women’s fashion sector.  

Hence, even though there are several luxury men clothing retailers, the combination of premium clothing and sustainable lifestyle shows a niche market not yet fully saturated when looking into Brussels shopping streets.

Interview with locals
Boulevard de Waterloo

The highest increase in purchasing channels can be observed In Store (pwc, 2017). Furthermore, a survey by PWC has shown that for Belgium consumers, highly educated sales associates in the store is crucial and almost half of the surveyed customers expect to be able to see, respectively order an extended range of products on an in-store screen. Consequently, brands establishing a retail store in Brussels can enter the market with their core products in-store and using an in-store screen to display further products. With highly educated and professional salesforce, the Belgium customer is ready to chose and orders from the in store screen.
Jozoku needs to focus on its core value producing sustainable premium suits in dedicated premium location to shape the brand as a whole to create the authentic brand experience for its customers (Meacham, Bloch, & Brusselmans, 2013). Despite the growing market a lot of competitors in the premium retail sector have also identified Brussel to be a rewarding location for profit as well as brand creation. Brussels being an international business hub will also help to create publicity and global brand awareness.

CSCP. (2012, December 31). D1.1_Baseline_Report_short.pdf. Retrieved 24 March 2019, from https://www.sustainable-lifestyles.eu/fileadmin/images/content/D1.1_Baseline_Report_short.pdf

Mason, A. (2019, February 15). 48 hours in . . . Brussels, an insider guide to the comic capital of Europe. The Telegraph. Retrieved from https://www.telegraph.co.uk/travel/destinations/europe/belgium/brussels/articles/brussels-travel-guide/

Meacham, M., Bloch, N., & Brusselmans, G. (2013, November 19). How consumer goods companies can win in low-growth Western Europe. Retrieved 24 March 2019, from https://www.bain.com/insights/how-consumer-goods-companies-can-win-in-low-growth-western-europe-forbes/

pwc. (2017). 10 retailer investments for an uncertain future. Retrieved 24 March 2019, from https://www.pwc.be/en/documents/20170424-total-retail-belgian-report.pdf