pacific brand
Case 2: Pacific Brands: Rebuilding the brand
Industry: Australian Textile(Apparel) Industry
Australia listed company from 2004.
Product segment of Pacific Brands:
Underwear & hosiery: 1/3 of sales, contributes more than half of the earnings
Workwear: account for just over 22% of sale
Homewear: account for just over 22% of sale
Footwear, outerwear and sport business: $175 million write-down on the division at February 2011
Market segment of Pacific Brands:
Australian, New Zealand, UK, Malaysia, China & Indonesia
Life cycle of the Australian Apparel industry: Shake out to decline (P2.18)
Growth & profitability are in clear decline;
Domination of the industry by a few large competitors no longer yields sufficient returns and even these companies leave the industry;
The industry’s products/service may no longer be useful to consumers as they have replaced by newer technology;
Strategic management concepts becomes even more import in deciding how to maintain a unique position in a win-lose environment;
Business strategy is about being creative, to create niches or even to revolutionise the industry.
Industry Value Chain: (p2.8)
Raw material supply – Ram Preparation – Fabric formation – Fabric finishing – Apparel manufacturing – Wholesaling (include Brand marketer, overseas buying offices and trading companies) – Retailers (include department stores, specialty store, mass merchandise chains, discount chains, off-price, factory outlet, mailed order)
Pacific Brands’ Organsation Value Chain:
Before 2009 transformation:
Product and brand design – manufacturing – logistics – marketing & sales
After 2009 transformation:
Product and brand design – Contract management – logistics – marketing & sales
Pacific Brands’ Transformation strategy (2009):
Cost-cutting;
Reorganisaing capital management & debt refinancing;
Simplifying logistics and operations;
Sourcing production offshore and developing capabilities required as a brand marketer.
1. What
Industry: Australian Textile(Apparel) Industry
Australia listed company from 2004.
Product segment of Pacific Brands:
Underwear & hosiery: 1/3 of sales, contributes more than half of the earnings
Workwear: account for just over 22% of sale
Homewear: account for just over 22% of sale
Footwear, outerwear and sport business: $175 million write-down on the division at February 2011
Market segment of Pacific Brands:
Australian, New Zealand, UK, Malaysia, China & Indonesia
Life cycle of the Australian Apparel industry: Shake out to decline (P2.18)
Growth & profitability are in clear decline;
Domination of the industry by a few large competitors no longer yields sufficient returns and even these companies leave the industry;
The industry’s products/service may no longer be useful to consumers as they have replaced by newer technology;
Strategic management concepts becomes even more import in deciding how to maintain a unique position in a win-lose environment;
Business strategy is about being creative, to create niches or even to revolutionise the industry.
Industry Value Chain: (p2.8)
Raw material supply – Ram Preparation – Fabric formation – Fabric finishing – Apparel manufacturing – Wholesaling (include Brand marketer, overseas buying offices and trading companies) – Retailers (include department stores, specialty store, mass merchandise chains, discount chains, off-price, factory outlet, mailed order)
Pacific Brands’ Organsation Value Chain:
Before 2009 transformation:
Product and brand design – manufacturing – logistics – marketing & sales
After 2009 transformation:
Product and brand design – Contract management – logistics – marketing & sales
Pacific Brands’ Transformation strategy (2009):
Cost-cutting;
Reorganisaing capital management & debt refinancing;
Simplifying logistics and operations;
Sourcing production offshore and developing capabilities required as a brand marketer.
1. What