Vertical Integration at the American Apparel Company
- American Apparel Company is based in Los Angeles.
- This company boasts of a strong vertical integration in its industrial organization.
- From a single location, the company controls its designing, cutting, sewing, finishing, dyeing, distribution and marketing process for its products.
- These departments are segmented and disfranchised within a systematic control system that monitors production progress .
- The company has been successful in distribution and shooting their in-house advertisements and promotions without having to outsource other industry players
The company operates and fully owns its sub retail branches instead of franchising any production, marketing, or distribution channels (Powell 1995).
This process is inclusive of the scientific aspects such as technical process of understanding the operations involved in operations management, their application, and evaluation criteria (Palmeri 2005).
In the marketing and distribution channels that are run from a central point, it is apparent that company structure, operations management, and efficiency of the advertisement department determine sustainability of its business.
Besides, the ability to customize products and offer competitive but high quality services determine success and profitability in short and long run (Harrison & St.John 2010).
References
Harrison, J., & St. John, C. (2010). Foundations in strategic management. Ohio: South Western Cengage Learning.
Palmeri, C. (2005). Living on the Edge at American Apparel.
Powell, T. (1995). Total Qality Management as competitive advantage: a review and empirical study. Strategic Management Journal, 16, 15-37.
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