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' : crOSrAT TIDAK DIBENARKANj

THESIS KAKttAHGAN

E D I T H COWAN UNIVERSITY
PERTH WESTERN AUSTRAL I A

UN1VERSITI TgKN.QtOC.I- MARA Kofra Kinabalu,

ZC FASHION HOUSE BUSINESS PLAN MANAGEMENT PROJECT VIA

(a: MBA 61O1

Submitted by Zuraidah Zaaba (0993980) 30 Sept 2000

Acknowledgement
I will like to thank To Almighty God for destine me to enrol and finish this MBA To my parent thank you for all the unconditional love you give me To all the staff of UiTM who indirectly assist me To all my friends who support and motivate me To my entire classmate, who assist me in their own way To Connie for her energetic touch To Zainal for being my good friend

To Peter for being there for me though afar; encouraging, trusting and helping me a lot especially for the last 3 modules; and never give up on me and successfully discover me Finally to Barry Chapman thank you very much

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Contents
Page Acknowledgement

Executive Summary
Industry

1
4

Product

Marketing Plan Operational Plan Management Team


Financial Plan

12 26 29
33

References and Bibliography Management Resume


Personnel, Personnel skills &Operation Skills ZC Fashion House Portfolio Appendix I Appendix II Appendix III Appendix IV Appendix V Appendix VI Appendix VII

40

Appendix VIII
Appendix IX Appendix X Appendix XI Appendix XII

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1.0

EXECUTIVE SUMMARY
Zuraidah Chua (ZC) Fashion House is a small sole proprietor business

founded

by Zuraidah Zaaba. It

is expected to

commence in

2001 (Appendix XII: Implementation Table). The idea of forming ZC

Fashion House as a result of the discovery that some market segments in the fashion industry are greatly underdeveloped. Therefore, it is intending to produce women's clothing of size 14/L and above; and fashion of women age 40s' and above.

The target market are large and old women especially, their siblings and friends; and Women Association. ZC Fashion House business is expected to be profitable because 20% Malaysian is obese, increase life expectancy due to health conscious, excess resources, fashion wise society and the positive condition in Malaysia.

ZC Fashion House ready made clothes are blouses, suits, skirts and pants and accept customised clothes. They are unique from the competitors' because ZC Fashion House acknowledges the 4 women body shapes i.e. cone, ruler, hourglass and spoon (Jakowski, 1999) and fashion suitability for the target group. In addition, its products are of the latest fabric, pattern and colour, which suit to the target group. So the products are custom

tailor. This is greatly ignore by the competitors i.e. lady shops and lady
tailors which only sell and know one particular body shape. Since

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competitors do not considered large and old women as their main costumers, ZC Fashion House will anticipate the slow retaliation from the

competitors.

However, before they retaliate, ZC Fashion House is preparing a strategy for competition by marketing its products and providing services directly to the target group. The first shop is in Wisma Muis which is surrounded
by office buildings and housing area in Kota Kinabalu. This will easily penetrate the market. ZC Fashion House selling strategy one is to employ

selling staff from the target group itself. ZC Fashion House is


concentrating on non-pricing strategy i.e. quality, good design and image,

good service, unique product and brand loyalty (Barrow and Brown, 1997). ZC Fashion House is still consider pricing strategy important by placing it products at odd pricing which is currently use in the market.

ZC Fashion House will advertise in the printed media, flyers and pamphlets. The advertisement is constant i.e. by reminding the existence and development of ZC Fashion House. It is also intended to form good

relationship with the society and the related individuals and industries. ZC
Fashion will continue to do research and train its employees in fashion, image, and public relation, selling technique and areas concern. ZC

Fashion also prepare for future market strategy by anticipating the future
outcome especially 2003 globafisation.

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In product development, ZC Fashion House designer has made customised

clothes and sketches. Since it emphasis on the quality and non pricing
aspect, ZC Fashion House is innovative in the operation aspect from process of designing custom tailor clothes, the process and scheduling and responsible in the aspect of cost of production through buying direct and in bulk help ZC Fashion House help to achieve quality product and earn profit.

In management, the owner will be involved in all aspect of the business. Madam Chua the owner aunt will be the designer and will be assisted by one assistant; there will be 2 part time seamstresses. The owner's parent especially Mrs Zaaba will assist in the daily running of the shop and also
seek advise from external expertise.

ZC Fashion House financial plan elucidate how much injection capital needed for it to commence. In addition, based on the detailed financial
projections, if ZC Fashion House receives RM40,000 in funding plus the owner own capital, it will operate profitably for the three-projected year (2001-2003). Table I is the summary of the projected financial information;

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Year 1 (2001) Sales Gross Pro6t Net Profit Return On Assets Asset Turnover Return on Assets Debt to Equity Debt to total Assets
Table I

Year 2

Year 3

RM201120.00 72.2% RM24854.02 0.44 3.6 44% 0.52 0.51

(2003) (2002) RM245971.20 RM207825.60 71.6% 68.9% RM36623.62 RM 22605.01 0.50 0.31 3.4 2.9 51% 31% 0.22 No more loan payment 0.21

2.0

INDUSTRY
ZC Fashion House is a sole proprietor business founded by Zuraidah Zaaba on the purpose that large and old women fashion is greatly underdeveloped in Malaysia particularly Sabah.

ZC Fashion House business will start in Kota Kinabalu (KK) in 2001. ZC Fashion House vision is really to specialise in this market and it will assist

the forgotten women to be fashion wise; beginning with Sabah market and
follow with Malaysia market.

2.1

Environmental Scanning
ZC Fashion House is at advantage because of the following environmental

situation:

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Political and Legal

There is incentive for women to be involved in business. In Sabah, a Women Welfare Unit under the Chief Minister Department had been set up. There is Persatuan Usahawan Wawasan Wanita Malaysia

(Wawasanita) a Women entrepreneur association which purpose is to


improve the indigenous socio economic especially Malaysian women (Abdullah, Berita Harian: Wanita digalak dalami e-dagang, 19 Julai 2000).

There is support from the state and the federal government through formal channel, Entrepreneur Development Ministry for instance and charging minimum trading licence fee; in Sabah, it is RM25. In addition, the
involvement from the non-governmental association for example

Chambers of Commerce, which purpose is to help Sabah indigenous in business.

Economics

During the 1997 crisis, the campaign

'Buy Malaysia Products' was

launched. It is among other mechanism, which assist Malaysia to recover


from the 1997 economic crisis and inevitably instil positiveness among the Malaysian towards local products.

Social

The society is more educated and the standard of living has improved. Malaysia especially Sabah is developing rapidly in assimilation of

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information communication technology and electronic commerce. This


has increased knowledge including Malaysian women (Ibrahim, Berita

Harian:'ICT tingkatkan Status Wanita, 18 Julai 2000). There are more


workingwomen then before.

Technology

Due to the technology advances, there are wide spread of fashion


information. This allows Malaysian to be informed of the latest fashion development.

In the 1990s fashion was greatly influence by Kate Moss skinny body
shape. It created follower from popular actresses to girls next door. The examples of legacy are Courtney Cox of 'Friends' sitcom, Helen Hunt

'Mad About You' sitcom, Gwyneth Paltrow of'Shakespeare in Love' and singer Christina Aguilera whose skinny apparent are watched by million viewers (Berita Marian, 1 August 2000). As a result, most of the lady
fashion shops in KK sell the skinny type clothes, which only could be

worn by the ladies who are willing to starve in order to be fit in these clothes (Observation July to 3 August 2000, 11.30am-5 pm).

Subsequently, Kate Moss skinny fashion suffered adverse effect when

some young women especially teenagers who willing to starve to be Kate

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Moss are diagnosis as of anorexia sufferers (Berita Harian, 1 August 2000).

In April 2000 there are approximately 200,000 anorexia sufferers i.e. 10 women to 1 man. Mainly, because of the teenagers who starved were for Kate Moss fashion sake. Some even take drugs. According to Britain Minister of Women, Tessa Jowell most women assume that fat is unattractive which result in low self-esteem and inferiority complex (Berita Harian, 1 August 2000).

In order to combat this problem, British government, pressure groups, magazine and newspaper agree not to use skinny model on the front covers and advertisements. Even the new pop singer Britney Spears apparent and few international film producers request their actresses to increase weight. (Berita Harian, 1 August 2000).

The current situation does affect Malaysia fashion world. Lina Teoh, Miss Malaysia and also second runner up of Miss World Contest 1999 support this through a statement claimed that diet should be forbidden. In addition, in this millennium, many women believe, Kate Moss is not important but healthy body and self confident is the key for attractive apparent (Berita Harian, 1 August 2000). Hence, this creates a new version of fashion.

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Health Issue

6 objectives programme of Ministry of Health in the 7th Malaysia plan shows the seriousness of the government on the health issue. The static crude death rate since 1989 until 1995 that average rate was 4.6 per 1000
population. (http:/www.health.gov.my, 2 August 2000) The booming of supplementary health food and finally the increase of public and private

fitness centres. Therefore, Malaysian Women is expected to live until 75


(2000)(http://www.statistic.gov.my, 8.12pm, 2 August 2000).

Fabrics and Sewing Materials

There are plenty of textile and sewing materials sellers and distributors in

Malaysia. However, the prices for textiles in Sabah are expensive and choices of patterns and textiles are limited due to geographic constraint. Nevertheless, the best alternative is to purchase in Peninsular Malaysia
which price is reasonable and plenty of choices. It is easy to travel in Malaysia because of efficient transportation.

3.0

PRODUCT
ZC Fashion House at the early stage will produce ready-made blouses, short and long skirts, pants and suits for the large women of age between
20s to 50s and old women of 40s' and above. The sizes available are L, XL and XXL for large women and M, L, XL for old women. M size is
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available for them because the Body Masse Index will reduce as human being grow older (Health Today, Jan/Feb, 2000)

ZC Fashion House clothes are unique because they are custom tailor. The
clothes are range from 4 types body shapes i.e. android (cone), gynecoid (hourglass), lymphatic (ruler) and thyroid (spoon) as shown and details in Appendix I. Usually women will fall on either android (cone) or gynecoid (hourglass) shapes (Aquino, 1997 and Jakowski, 1999).

Competitors

The lady tailors only make customise clothes. This is time consuming and

usually costumers have to buy own fabrics. They costs are more expensive
than the ready-made clothes. Furthermore, some lady tailors only expert in

one body shape only. This is based on the feedback interview with Mrs
Komilus 4.15pm, 20 September 2000 in UiTM; she claimed that one of the lady tailors in KK who made her cloth only knew Kate Moss body shape. She ended up abandoning the clothes.

Whereas, the lady shops owners will purchase whatever the current
fashion the clothing manufacturers manufacture. They usually purchase clothes, which, suit model body shape. If they do purchase for large and

old women, the clothes will not suit to their size or body shape (observation made on 28 July 2000). Appendix II (A & B) is example of

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the competitor ready-made clothes. If there is ready made custom tailor


clothes it will be expensive (Appendix II C).

3.1

ZC Fashion House Products


The cutting of the clothes will be based on the body shape coupled with emphasis on 3 rules i.e. camouflage, illusion and spotlight. This will result
the women look beautiful and elegant despite their size and age. The details of the products are in ZC Fashion House Portfolio (sample model

and sketches) and Appendix VI the process designing ready-made clothes.

3.2

Custom tailor Clothes (the details in Appendix VI; Custom Tailor:

Customised Clothes)
ZC Fashion House will also accept customise clothes, which are not in the ready-made product line; like traditional custom and evening dresses.
Therefore, this will inevitably promote ZC Fashion House and will also be good for products research.

3.3

Clothes (sample in ZC Fashion House Portfolio)

ZC Fashion House's blouses fashion is focus on simplicity and elegant, which will suit from casual wear to informal occasion. The skirts and

pants, will suit from casual to office wear. The suits will suit from office to formal occasion. In addition, ZC Fashion House blouses consist of long and short sleeve and skirts have short and long to accommodate the taste
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preference and the long sleeve and skirts also adaptive to Muslim ladies
who are fashion lovers and still can abide to Islamic dressing code.

The blouses are buttoned instead of zipped. In addition, the skirts and pants' waist is made of elastic instead of interlining tape, so it is easy and comfortable wearing ZC Fashion House clothes the whole day.

3.4

Fabrics (sample in ZC Fashion House Portfolio)

ZC will use fabrics that are suitable to the tropical climate. The fabrics will allow air to penetrate, which provide cooling effect to the body. They

are also easy to iron and wash. The fabrics are of the latest trend because owner or designer will personally purchase the fabrics in Kuala Lumpur
(KL) and Kelantan.

3.5

Colour and Pattern (sample in ZC Fashion House Portfolio)

The colour and trendy pattern of ZC Fashion House's clothes will blend with South East Asian multi racial society colour, pattern and the latest trend preference i.e. from soft to striking colour and nature to geometric
pattern. In addition, these must suit to the sizes. Darker colour and smaller

pattern will mostly suit the large size ladies. However, there is brighter colour, which can be matched with darker skirt or pants. The old women, darker colour is suitable and the fashion preference that display 'older and wiser' theme.

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3.6

Services
ZC Fashion House provide fashion and image consultant; and after sale
service to its customers like alteration. The lady tailors also provide these

services. However, the difference is ZC Fashion House emphasis in it speciality in the target market (large and old women) preference and
focusing on fashion suitability.

3.7

Product and Service Development


ZC fashion House will be focusing, improving and increasing the volume

on the projected initial product line. It is because this product line is


greatly ignored by the lady shops. In addition continue improving in the services to the customers especially in fashion suitability.

4.0
4.1

MARKETING PLAN
Target Market
As mention earlier they are:
* Large Women age 20s to 50s, who live, work and visit in KK area.

*
*

Old Women of age 40s and above who work and live in KK.
Siblings and acquaintances of large and old women who live and

visit KK

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The Women association


These associations' members whose age 40 and above are career and
business ladies and wives of public and private servant, businessmen and politician as well. Most of them fit the target group of old women 40s and above. They are more conscious in their apparent. In addition this association also could form strategic alliance to market ZC fashion

House clothes.

4.2

Market Definition and Opportunity


The Large and Old Women Fashion Industry

Large size women fashion is not excessively developed especially in developing countries namely Malaysia. It is more of follower than

innovative in the fashion industry. In the western countries there are


entrepreneurs who penetrate this market namely one of American actress who develops her large size clothing business. This development is

underdeveloped in developing country Malaysia for instance. There is no


intention to exploit the market of this niche population. The complain was, the clothes are not custom tailor therefore they do not fit even though the size display L to XXL (Nelly, interviewed on 10 August 2000, 5.30pm) .

Old women fashion also experience similar problem. The worst part, they have to choose ready-made clothes from the young women section. They

either end up buying the most plain, odd pattern and design or suffer being

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scrutinize by the public who assume either has no taste in fashion or not
admitting they are getting older (Mrs Zaaba, interviewed on 10 August 7.00pm).

The best alternative is to make customised clothes from the ladies tailor.

Large Size Population

ZC Fashion House will have no problem in marketing it product since there

is increasing large size population. Bjorntorp (1996) cited by Roche Pharmaceuticals (Health Today, 2000) as claiming that obesity, which is
affected by factors such as age, sex, race and economic status. Currently

estimated at over 100 million worldwide and it continues to rise at a


remarkable rate. In Malaysia itself, nearly 20% or 4.7 million (Monthly Statistical Expenditure, July, 2000) of its population is obese (Health Today, Jan/Feb 2000).

In detail Abdul Kadir (1996) cited by Roche Pharmaceuticals (Health


Today, Jan/Feb 2000) elucidated that: The prevalence of obesity in Malaysia is estimated to be 5-8% in urban and 6.5% in rural areas. A compilation of Body Mass Index (BMI) in adult

Malaysians (2636 males and 2111 females) from 3 ethnic groups in urban
areas reveal 29% of males are overweight (BMI 25 to 30) and 8% obese (BMI>30) while females are 26% overweight and 8% obese In a rural area

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of Malaysia the prevalence of overweight was 24.1% and that of obesity was 6,5% (back cover). ZC fashion House will account BMI in designing it

ready-made fashion.

Life Expectancy

It is an opportunity for ZC Fashion House since life expectancy at birth for Malaysian female is 74,9 (1999) and 75 (2000)

(http://wwwstatistic.gov.my, 8.12pm, 2 August 2000). The population of

the older generation in Sabah i.e. 40s to 70s, increase to 1609.1 (1999) and
1739.3(2000).

The reason is because Malaysia health programme which is part of it country plan and annual budget for 7th Malaysia Plan ( 7th Malaysian Plan: 1996-2000, Percetakan Nasional Berhad 1996 ). In addition, there are

wide spread of health conscious among the Malaysian population. There are lot of supplementary food being sold (Health Today, Jan/Feb 2000).

Income and Perception

There is increasing number of workers according to age for example 45-49 6.1% 1996, 6.3% 1997 and 7% 1999 (Yearbook Of Statistics Sabah 1999).

Income per capita forecasted in 1999 was RM 11,831 (Bank Negara, 1999). In addition rising net Employment Provident Fund (EPF)
contributions in the first 5 months of 2000, suggest a higher number of

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EPF contributors coupled with rising wages. Both factors should underpin

an increase in consumer spending (New Straits Times, Business: Net EPF Contributions Can Shed on Employments, Wages, 25 September 2000).

There are intensive promotions on saving the government especially as a result of 1997 economic crisis. The increase of provident fund (Year book
Of Statistics Sabah 1999) and new scheme of investment for example introduce by employment provident fund and other private bank and finance. In addition, the continuous promotion of strong family value, buy Malaysia products and clothes are necessity clothes will indirectly promote ZC Fashion House clothes.

4.3

Competitors and Competition Analysis


Lady Tailors
The lady tailors like Mayang Sari and Umastine in Centre Point only make customise clothes, which take considerable time to make it. It is usually
expensive than the ready-made clothes. The tailoring fees will range from

RM45 blouse and above (Yew, 2 August 2000). If they do produce ready
-made clothes, it will be during festival session and the size will normally

range from size S to L. However, they might not react rapidly to ZC Fashion House entry because their customers range from other target
group.

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In addition as claimed earlier on the owner experience and Mrs Komilus


statement, they ignore the 4 body shapes and knowledge in beautifies the 4

body shapes.

Lady Shops

The competitors usually sell the large and old women clothes with other target group clothes. The competitors like Guan Chong Hong Sdn Bhd of
Segama Street and Kian Teck Sdn Bhd of Wisma Merdeka and Centre Point imported the big sizes lady clothes. Usually from Hong Kong, Taiwan, China and Singapore (confirm by all the lady shops owners and workers, 28 July and 3 August, 11.30-5pm). They do not provide a wide

range of clothes product line to suit to the big size lady. Usually they only sell blouses size L, XL and XXL but not custom tailor. The clothes are
usually suitable for lymphatic shape. In addition, they do not consider the

suitable colour or pattern for the target group. There is no advised for their
customers in clothes selection (direct observation, 28 July and 3 August 2000 11.30am-5.00pm). They might not immediately consider ZC Fashion House as a threat since their product line is more concentrating on current

fashion only.

However, despite the deficiency, the target group still buy it because of

limited choice. Sometime they will alter the clothes or just wear it. If they

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are fossy or none of the ready-made clothes suit them, they will go to the lady tailors.

ZC Fashion House anticipate threat will be in 2003 when Malaysia entry to globalisation. There could be speciality shops for large and old women

especially from China, Korea and Western countries (based on observation


28 July and 3 August 2000, 11.30am-5pm).

4.4

Marketing Strategy
4.4.1 Distribution and Sales Strategy

ZC Fashion House will intend to sell its clothes directly by opening a shop in KK. The purpose is to assist the customer in clothes selection and

provide services for example alteration. This will eventually allow ZC Fashion House to penetrate this market successfully and have direct contact to its target group around KK. In addition, this will assist ZC Fashion House research and development in knowledge accumulation, compilers and improve its products and services. These services also could
educate the target group.

The sale assistant will have the feature of large size woman and is
interested in fashion and good personal relation. She will be demonstrating in the shop. The owner's mother also will display the design to demonstrate to the customers. The sale assistant will be given an explicit

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job description. In addition, ZC Fashion House will have fashion shows


quarterly during women and mothers' day, charity and women association function.

There will be continuously learning latest selling techniques and product information to all the three personnel (the owner, sale assistant and Mrs Zaaba) in the sale section. This will assist in selling of the ready-made
clothes.

4.4.2 Pricing strategy

Non-pricing competition will be emphasized. The distinctive product features, product quality and services and promotion will distinguish from
competitors, ZC Fashion House will do extensive promotion to establish

superiority and set apart from competitors in the mind of buyers. This will build up customer loyalty towards ZC Fashion House clothes. Therefore ZC Fashion House customers will not easily lure by future competitors. (Pride and Ferelf, 1997)

However ZC should not ignore price competition because the Malaysian namely Sabahans are sensitive to prices since the 1997 economic crisis.

Price has psychological impact on customers. Price could lure potential


customer to venture into it shop/ products. Afterwards, then they will evaluate the services they receive from ZC Fashion House staff. If price.

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product and service satisfy the potential buyers, they will buy and could
possibly be ZC Fashion House loyal consumers.

Therefore at the beginning, ZC Fashion House ready-made clothes price is of current price (Appendix III: Expected sale price) since it is new. The price expected to increase by RM10 (Appendix HI) in the third year with anticipation cost inflation in 2003 and to be distinguish from the anticipate

competitors. The customise clothes projected fee is based on average RM60. It might be higher according to the fashion, fabric and
workmanship.

ZC Fashion House will apply odd pricing, a psychological pricing, which commonly use today (Pride and Ferell, 1997). If the fashion is out of
season, seasonal discount is use.

4.4.3 Promotion Mix

ZC Fashion House will strive for integrated marketing communication, which is coordination of promotional elements and other marketing efforts that communicate with costumers to maximize total informational and promotional impact on customers (Pride and Ferrell, 1997). Subsequent to

this and acknowledge each promotion mix has it limitation, ZC Fashion

House has decided to use these promotion mix.

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Advertising

Local media will be the main target of advertisement. ZC Fashion House allocate fund under marketing expenses to work with an advertisement
company to advertise in well read newspaper and magazine in Sabah for example Daily Express and Jelita respectively. It will also distribute flyers,

business cards and pamphlets. It begins with informing the business nature and location follow with product advertising follow with pioneer
advertising, competitive and comparative advertising. On the second projected year, reminding and reinforcement advertising will be used.

Public Relation

ZC Fashion House will take the opportunity to appear in the national radio in the business and programme section for new entrepreneur. This will allow direct contact with potential customers. Apart from that, ZC Fashion
House will ensure that it also appear in fashion, women, academic and

business magazines section. This can be achieved through forming a good


relationship with them.

In addition, ZC Fashion House will not forget it obligation towards

society, ZC Fashion House will contribute to the old folk home, assist in promoting family value in Malaysia as well as Sabah community and also will provide free consultation in self image either the customers or the
public occasionally especially women association courses, seminar and

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