The Future of Retailing in Turkey- Managing Local and Global Growth

Industry Day

18 May 2012, Friday
Conrad Hotel İstanbul, TÜRKİYE

At the conference where academy and business world came together, speeches were made about innovations and developments in operations and marketing in retail.

In her speech titled “Myths and Facts”, Camille Egloff, partner and managing director of the Athens Office of the Boston Consulting Group, gave examples of changing balances and new trends around the world.She mentioned how consumers in developed countries tend to spend more cautiously, while in developing countries such as China and India, spending has shifted towards branded and luxury products.That Turkey attracted much attention from every angle and stressed that the global players create an agenda to enter the market.

John Zhang, marketing professor at the Wharton School of the University of Pennsylvania, first began his speech by saying how important and necessary it is to have academics and business together.Prof. Zhang presented his theories for the store under the title of store concept and the upcoming revolution in retail.He pointed out that when both companies and retailers perform profit optimizations separately, losses have occurred to a large extent for both customers and manufacturers and retailers, and therefore manufacturers such as Apple have emerged as retailers.He stated that he developed a concept where retailers and manufacturers can be more successful with the in-store model.In this case, he concluded that the retailer made a profit with the rent which consists of the percentage of sales, and that the producers made more profit for both the customer and ultimately for not making double margin.

Professor of Operations in University of California Anderson School of Management Felipe Caro, said that the retail conference of KÜMPEM Forum is very useful in terms of understanding the sector in Turkey. Professor Caro, known for his inventory management and rapid fashion retail network research in Zara, said Koton was impressed by the operation, especially with double-digit growth figures which a few retailers have the opportunity to experience.

In the afternoon, the conference started under the moderation of Prof. Gürhan Kök from Duke University Fuqua School and representing the leader firms of the sector, by Teknosa General Manager, Mehmet Nane, Migros Ticaret General Manager Özgür Tort and Koton Chairman Yılmaz Yılmaz.Zara model is spoken in the morning session, the question of how it is implemented by Cotton in Turkey were asked to Yilmaz Yilmaz.Yilmaz mentioned that Koton had bought 80% of the products from Turkey and the production lasted 56 days, but he said it is necessary to shorten it.Apart from this, he said that the competitive advantages are to make a difference to local markets with local collections.He noted that the average price of knitwear in Turkey is  29 TRY ,and while Zara, and the fast-fashion is very important, but pricing and positioning is more important.

Koton Chairman Yilmaz Yilmaz, noted that KÜMPEM Forum retail conference is very useful in terms of academic studies to see the applications in the sector.He said that he thinks that academics and business world should work closer to increase sales by 3-4 percent with the use of algorithmic models.

General Manager of Migros, explained the dynamics behind Migros’ leadership in many innovations in retail in Turkey.Talking about the importance of mobile commerce, and Facebook going public with $100 Billion, he mentioned that whether having a physical entity or not was not important anymore.

Mehmet Nane shared Teknosa’s competitive approach, which excluded Best Buy.Nane concluded his speech by noting that, $55 Billion value Best Buy was unable to cope with the innovation of Teknosa in Turkey.

The first session in the afternoon was given by Naren Agrawal, professor of operations and supply chain at Santa Clara University in California.Prof. Agrawa said that retail chains had only one chance when ordering, and that orders placed after the start of the season did not bring profit to the company.He also stated that in order to make the right order, a properly constructed supply chain is required.

The last session was attended by Joseph Nunes, professor of marketing at the Marshall School of the University of Southern California. Professor Nunes talked about the privilege of status.