Company Background
- VF Brands: a well-recognized brand in the apparel industry;
- Founded in 2010;
- Facing challenges due to high competition rates;
- Extensive collaboration with other companies.
Define the problem
- Inconsistency in supply chain management;
- Problems with maintaining homogeneity in performance quality;
- Lack of collaboration between staff members;
- Absence of coordination in performance of employees.
Supply chain management is a significant issue for large apparel brands, such as VF. VF Corporation includes a variety of brands and is one of the largest American clothing companies. The company is focused on manufacturing and distributing its products efficiently and without fault, and is currently considering transforming its supply chain. VF Brands is a company in the apparel industry. The company was founded in 2010 in Denver, Colorado. The organization has been quite successful in the target market. VF has gained quite a popularity under the helm of Steve Rundles. The organization’s revenues have been consistently rising over the years of its existence.
The main problem in the case is that VF’s current supply chain strategy has some disadvantages that affect operations and product quality. For example, there is a lack of coordination between the company and its suppliers. This is likely due to the fact that VF Corporation uses short-term contracts with its suppliers, and typically requires them to produce a certain amount of a specific product for one season. Coordinating the efforts of multiple suppliers is challenging, and VF has already encountered problems with inventory management and high lead times. Consequently, the inadequacy of the current supply chain is an issue that has to be addressed by VF Corporation to enhance operations, product quality, and profitability.
Becoming a trendsetter in the apparel industry is a challenging goal due to the ever-changing environment and the emergence of new fashion ideas that are immediately integrated into the fabric of the industry. Therefore. FV should be credited for gaining the amount of influence that it currently has. However, even with the reputation that it has gained, FV is likely to face several issues when maintaining presence in the current economic environment due to high competition and a drop on buyers’ potential. Specifically, given the present issues in FV’s supply chain, the threat of ceasing production becomes increasingly tangible. Therefore, the company will need to seek additional strategies for increasing the efficacy of its performance. With a strong strategy for managing its resources, FV will be able to handle the current hindrances in its performance management.
Three strategies
- In-house production:
- Active use of company’s workforce;
- Complete reliance solely on VF’s own resources;
- Increasing the company’s HR potential;
- Potential inventory issues and lower resilience.
- Outsourcing:
- Collaboration and use of experts outside of the company;
- Long-term contracts with suppliers of human resources;
- Higher costs and greater risks.
- Combined method:
- Focus on cooperation and sharing of knowledge and experience;
- Focus on talent management and professional development of VF’s staff;
- Effective management of costs.
Currently, VF can deploy the strategies such as in-house production, outsourcing, and a combined method. In-house production allows focusing on talent management within the company, encouraging the development of staff’s skills. Outsourcing, in turn, is geared toward knowledge and experience sharing. A combined method represents the characteristics of both.
The SWOT analysis
- Strengths:
- Long-time, well-established presence in its present market;
- Strategy based on product innovation and creation of new brands;
- Highly reliable suppliers and well-established relationships across its SC;
- High customer satisfaction rates due to high product quality.
- Weaknesses:
- Low levels of product diversity (hence the threat of other competitors);
- Lack of investment in innovative technology;
- Absence of a strong cross-cultural strategy for promoting diversity;
- Poorly developed marketing strategies.
- Opportunities:
- Exploring new trends and changes in customer behavior to offer innovative products;
- Expansion of the company’s online channel;
- Using market development to address the competitors’ advantages and develop VF Brand’s own one.
- Threats:
- Emergence of cheaper imitations and counterfeit products;
- Rapid shift from offline to online shopping among target audiences;
- Lack of competent workforce.
The VF Brand has a range of strengths that it can use to pursue its current opportunities in the target market. Specifically, the main strength of the company is its ability to incorporate innovation into its production process, thus updating its brand to keep the audience’s engagement high.
The SWOT analysis conducted above provides an impetus for multiple improvements in VF’s performance. For example, the company could focus on advancing in new markets and gaining global influence by using their innovation-driven strategy. With the production system based on using innovative solutions, VF Brand will be able to improve its position. However, the lack of diverse products and effective marketing along with cultural issues as major weaknesses may affect VF Brand’s performance significantly.
Therefore, the company could focus on increasing product diversity by studying the current trends in customer behavior. Moreover, VF Brand could focus on developing a presence in the digital context to attract an even larger number of clients. Coupled with a policy of decreasing cost and promoting cost-efficient management, the suggested approach will help the organization to avoid major threats, such as copycats capturing the market.
