The Timberland Company: Challenges and Opportunities
CASE STUDY
The Timberland Company: Challenges and Opportunities
The Timberland Company, headquartered in Stratham, New Hampshire, makes and markets footwear, apparel, and accessories. Its footwear includes hiking boots, boat shoes, sandals, outdoor casual footwear, and dress shoes. The apparel line includes socks, shirts, pants, and outerwear, whereas accessories involve such products as watches, sunglasses, and belts. Timberland sells its products around the world through department stores and athletic stores and operates over 220 company-owned and franchised outlets in the United States, Canada, Latin America, Europe, the Middle East, and Asia.
Timberland has a strong international operation with a growing market in China; however, it has experienced increased labor costs and tariffs in Europe. In 2006 the tariff issue became very important due to the sourcing of approximately 30 percent of Timberland’s total volume from factories in China and Vietnam. The company’s international strength has been offset somewhat by its declining market fortunes in the United States. Timberland also faces increased competition globally, particularly from Nike and Adidas. From 2001 to 2005, Timberland had an average annual revenue growth of 7.5 percent, compared to the industry average of 9.0 percent during the same period. Moreover, revenue growth has been decelerating. In 2006 Timberland had $1.6 billion in revenues that reflected growth in the business segments serving casual, outdoor and industrial consumers. However, the boot business declined due to significant fashion changes that diminished demand for those products.
Although Timberland experienced some market difficulty in 2006, it was still recognized as a great place to work. The company was honored by Working Mother magazine as “One of the Best Places to Work for†and by Fortune magazine as “One of the 100 Best Companies to Work for.â€Â
Timberland develops and uses
The Timberland Company: Challenges and Opportunities
The Timberland Company, headquartered in Stratham, New Hampshire, makes and markets footwear, apparel, and accessories. Its footwear includes hiking boots, boat shoes, sandals, outdoor casual footwear, and dress shoes. The apparel line includes socks, shirts, pants, and outerwear, whereas accessories involve such products as watches, sunglasses, and belts. Timberland sells its products around the world through department stores and athletic stores and operates over 220 company-owned and franchised outlets in the United States, Canada, Latin America, Europe, the Middle East, and Asia.
Timberland has a strong international operation with a growing market in China; however, it has experienced increased labor costs and tariffs in Europe. In 2006 the tariff issue became very important due to the sourcing of approximately 30 percent of Timberland’s total volume from factories in China and Vietnam. The company’s international strength has been offset somewhat by its declining market fortunes in the United States. Timberland also faces increased competition globally, particularly from Nike and Adidas. From 2001 to 2005, Timberland had an average annual revenue growth of 7.5 percent, compared to the industry average of 9.0 percent during the same period. Moreover, revenue growth has been decelerating. In 2006 Timberland had $1.6 billion in revenues that reflected growth in the business segments serving casual, outdoor and industrial consumers. However, the boot business declined due to significant fashion changes that diminished demand for those products.
Although Timberland experienced some market difficulty in 2006, it was still recognized as a great place to work. The company was honored by Working Mother magazine as “One of the Best Places to Work for†and by Fortune magazine as “One of the 100 Best Companies to Work for.â€Â
Timberland develops and uses