VF BRANDS



By:
Mike Arnot, Carl Benjamin,
Steven Cardadeiro,
Roongruudee Chanwanitkulchai, Stephen Chung, Shilpi Kaul

Brand Coalition Strategies - Internal MFT.

• Internal MFT:
• Pros: Full control, high quality, efficient, reliable, shortest lead time
• Cons: High cost

Brand Coalition Strategies - Outsourcing

• Outsourcing:
• Pros: flexibility, cost minimization
• Cons: lack of coordination/trust between supplier and buyer (high inventory, long lead time), network investment, careful monitoring of supplier mft. capabilities

Brand Coalition Strategies - Previously...

• 60% jeanswear in house
• Imagewear produced largely internally
• 100% outsourcing for lifestyle apparel, footwear, and backpacks
• Provides competitive advantage

Brand Coalition Strategies - Challenges

• Product line complexity: over 600K SKUs, 100K SKUs for jeanswear alone
• Differing needs/priorities: design is king for fashion products (no cost consideration); others focused on low cost + rapid replenishment (Zara competitors)

Brand Coalition Strategies - Recommendations

• "Other": Outsource (small %, low rev.)
• "Contemporary": third way, or design in house (fashion oriented) & outsource production
• "Outdoor": third way (varying seasonality - flexibility)
• "Sportswear": outsource (low rev., simplicity)

Brand Coalition Strategies - Recommendations

• "Imagewear": combination of third way (flexibility for sports jerseys) & outsource (mass production for generic Harley Davidson-esque items)
• "Jeanswear": in house (high product variability, i.e. 100K SKUs; good investment for highest revenue product)

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