Case analysis - Harrington Collection
Case analysis-Harrington Collection
Problem identification
In 2008, Harrington Collection, a large manufacturer and retailer of U.S. high-end women’s apparel, was facing opportunities and challenges whether to launch of active-wear products to meet the market and customers’ needs. But according to the macroeconomic environment, the target market, competitors and its own financial condition, Harrington needed to take careful consideration and then make the best decision for their own development.
The U.S. women’s apparel industry
Market trends
From the data of U.S. Apparel Market Sale (2002-07), we could find out that, even when subjected to the impact of the economic downturn, the U.S. women's apparel industry remained in a mature and stable state and held by continued growth momentum. The Retail Sales increased from $106 billion in 2002, to $133 billion in 2007. The average annual growth rate is 4.7%. It showed that the total sales of the women's apparel industry did not receive the macroeconomic impact. Consumers still had a high desire to go shopping.
At the same time, analyzed the data from U.S. Apparel Market Units, influenced by the economic downturn, consumers were more interested in less than $100, low-priced women’s apparel. From 2005 to 2007, the growth rate of units sold in more than $200 is 3.4%, the product growth rate of between $100-200 is 1.4%, and $50 to 100 product growth rate is 14.3%, while less than $50 low-priced products have the highest growth rate of 16.1%. The low-cost market has a great opportunity for manufacturers.
Characteristics and competition The value chain of the women’s apparel industry is about: (1) branding; (2) design; (3) buying; (4) production; (5) channel marketing; (6) distribution; and (7) retailing. In the era of apparel products are relative homogenization, price war seems to become a common method to erode the market share of each other between brands. Each brand need to face how to effectively
Problem identification
In 2008, Harrington Collection, a large manufacturer and retailer of U.S. high-end women’s apparel, was facing opportunities and challenges whether to launch of active-wear products to meet the market and customers’ needs. But according to the macroeconomic environment, the target market, competitors and its own financial condition, Harrington needed to take careful consideration and then make the best decision for their own development.
The U.S. women’s apparel industry
Market trends
From the data of U.S. Apparel Market Sale (2002-07), we could find out that, even when subjected to the impact of the economic downturn, the U.S. women's apparel industry remained in a mature and stable state and held by continued growth momentum. The Retail Sales increased from $106 billion in 2002, to $133 billion in 2007. The average annual growth rate is 4.7%. It showed that the total sales of the women's apparel industry did not receive the macroeconomic impact. Consumers still had a high desire to go shopping.
At the same time, analyzed the data from U.S. Apparel Market Units, influenced by the economic downturn, consumers were more interested in less than $100, low-priced women’s apparel. From 2005 to 2007, the growth rate of units sold in more than $200 is 3.4%, the product growth rate of between $100-200 is 1.4%, and $50 to 100 product growth rate is 14.3%, while less than $50 low-priced products have the highest growth rate of 16.1%. The low-cost market has a great opportunity for manufacturers.
Characteristics and competition The value chain of the women’s apparel industry is about: (1) branding; (2) design; (3) buying; (4) production; (5) channel marketing; (6) distribution; and (7) retailing. In the era of apparel products are relative homogenization, price war seems to become a common method to erode the market share of each other between brands. Each brand need to face how to effectively