Executive Summary

Chong Training was founded in the year 1999 by Chong Park in San Leandro, CA as a manufacturer and wholesale distributor of urban clothing wear. Chong Wholesale sells custom printed t-shirts, jackets, and sweatshirts to clothing retailers across Northern California. Chong Wholesale has five full-time employees who produce the clothing goods while Mr. Park handles customer orders, deliveries and the company’s sales and marketing. Mr. Park’s wife, Ms. Park, deals with the company’s financial and accounting operations.

Chong Wholesale acts as a wholesale distributor to over 45 clothing retailers across Northern California and focuses its operations in the San Francisco Bay Area and Sacramento Areas. Chong Wholesale has seen moderate and organic growth since its inception, and since the year 2000, the company has consistently realized huge profits. In 2016, the company has grossed over $5 million dollars with its current profit at $1 million after expenses. Mr. Park has remained focused on selling directly to its existing clients and has not ventured into new customers or markets since 2008. Therefore, there arises a promising market opportunity as the company can enter into and exploit new markets.

Since the company’s 20-year anniversary is fast approaching, customer demand has been stagnant as several of its clients have gone out of business. The fundamental reason is the emergence of the online market; thus the market for clothing has taken that direction. Even if just a few of Mr. Park’s customers go out of business, it has a significant impact on his business operations as Chong deals with most 45 clients directly.

After conducting a leadership audit of Chong Wholesale, it appears Chong Wholesale is significantly underperforming in three areas, namely change management, information technology management, and financial management. Upon understanding the challenges facing Chong’s firm, there is the need to seek feasible solutions. After meeting with Mr. Park and with his clients and by analyzing Mr. Park’s financial and business operations, I have proposed three recommendations.

The first recommendation entails purchasing new computerized printing machines to allow greater product recommendations for clients. With the computerized printing machines, there will be increased productivity, which will, in its turn, lead to greater market share. The company’s clients will be better placed to recommend the products to other customers.

The next recommendation for the company is to hire a sales marketing manager who will be charged with exploring, expanding and exploiting the business to new markets. These managers will have experience in developing an online marketplace. Since the modern world is technologically-enabled, the future of most companies lies in the online market. Therefore, the sales marketing manager will help the company soar to new levels.

The third and last recommendation which is pertinent to address underperformance of Chong’s firm is to create a company website with full CRM integration that will be created and managed by a new part time employee. Customer relationship management entails strategies, practices, and technologies used by a company to manage and analyze customer interactions and related data in the course of the customer lifecycle. Therefore, the integrating the company website with full CRM will assist Chong Wholesale to retain customers and also facilitate the growth of sales.

These recommendations will require additional expenses and initial upfront costs to implement. If the measures are executed correctly, the company should expect long-term sustainability and growth in new markets. It is expected that each of these recommendations will take approximately six months to implement with an additional $80,000 for its fruition. Besides, it is believed that Chong Wholesale should expect to regain revenue from its 2010 sales year and expect a 10% growth in sales for the next five years after implementation.

Business Challenge

Client sees demand for its products decreasing as its competitors are moving online. Therefore, the failure of the business to expand its operation online acts as a great impediment to success.

Background/History

Chong Wholesale is a sole proprietor company owned by Chong Park and his wife, Pak Park. Back in 1998, both immigrated to the United States from South Korea and started to make a living from selling clothing at flea markets in the San Francisco Bay Area. As their business expanded from weekend flea markets, they bought their first shift press and rented a small warehouse in Oakland where they would make their clothing. Within a few years, Chong Wholesale developed their business and now leases a 3,000 square foot warehouse there it prints over 21,000 articles of clothing every year, and in the year 2016, the business made revenue of over $5 million. Currently, Chong Wholesale has five full-time employees who are charged with printing the shirts. The employees also assist in delivering clothing to its customers across Northern California.

Target Market

Chong Wholesale does business strictly in the Business to Business Market by selling directly to small business retailers. Chong Wholesale sells clothing at wholesale prices to clothing outlets. Chong Wholesale focuses on “urban wear” and “hip hop fashion” clothing by targeting the 15-30-year-old demographic, urban markets in Oakland and San Francisco. Hip hop fashion is known as “big fashion”, and is a distractive clothing style originating from Latin and African-American culture. Hip Hop and urban fashion remain a significant part of the culture in Oakland and Francisco. Therefore, the business promotes fashion type across the world for all ethnicities.

Mission Statement/Vision Statement/Goals

Despite the business being established several years ago, it still lacks a written mission statement or vision statement. Although Chong Wholesale does not have an official mission statement, Mr. Park established his mission in the following way to avail to his clients the highest quality product and make a long-term partnership with its clients. The vision of Chong Wholesale is to sustain its current operations and pass down its business to their children or a prospective buyer within the next decade. The vision of Chong Wholesale is thus significant as it aims to reach out larger market share, and also is committed to passing the operations to future generations.