Mercury Footwear Questions
Mercury Footwear Questions
1. Is Mercury an appropriate target for AGI? Why or why not?
Yes, we do think so.
In the case, we could find some characteristics of footwear industry:
(1) It is a mature, highly competitive industry marked by low growth, but stable profit margin.
(2) Performance of individual firms could be quite volatile for they need to anticipate and exploit fashion trend.
(3) Except some global footwear brands, athletic and casual shoes market is still fragmented, which means each company could has its own market because of its characteristic.
(4) In this market, it is important for the brand image, specialized engineering for performance and price.
(5) Life cycle is short.
(6) Inventory management and production lead times are critical for the success.
(7) Main sale channels are department stores, independent specialty retailers, sporting goods stores, boutiques and wholesalers.
(8) Most of the firms outsource the manufactures in China.
Below are some characteristics for Mercury and AGI we need to focus on during the analysis:
AGI
Mercury
Target Customer
Target customers are urban and suburban family members aged 25 to 45.
Youth market, mainly 15 to 25.
History
Among the first companies to offer fashionable walking, hiking and boating footwear.
Its mother company decided to extend the brand by creating complementary line of apparel. Because of the poor performance, it was decided to sold.
Style
Logo is marked with prosperous, active and fashion-conscious lifestyle.
Its main customers are not interest in its apparel.
Financial performance
Among the most profitable firms.
Had poor performance after acquisition by WCF.
Revenue contribution
42% of revenue from athletic shoes and balance from casual footwear. Revenue and operating income were 470.3 million and 60.4 million in 2006.
Revenue and EBITDA were 431.1 million and 51.8 million..
Products
Athletic shoes developed from high-performance footwear to
1. Is Mercury an appropriate target for AGI? Why or why not?
Yes, we do think so.
In the case, we could find some characteristics of footwear industry:
(1) It is a mature, highly competitive industry marked by low growth, but stable profit margin.
(2) Performance of individual firms could be quite volatile for they need to anticipate and exploit fashion trend.
(3) Except some global footwear brands, athletic and casual shoes market is still fragmented, which means each company could has its own market because of its characteristic.
(4) In this market, it is important for the brand image, specialized engineering for performance and price.
(5) Life cycle is short.
(6) Inventory management and production lead times are critical for the success.
(7) Main sale channels are department stores, independent specialty retailers, sporting goods stores, boutiques and wholesalers.
(8) Most of the firms outsource the manufactures in China.
Below are some characteristics for Mercury and AGI we need to focus on during the analysis:
AGI
Mercury
Target Customer
Target customers are urban and suburban family members aged 25 to 45.
Youth market, mainly 15 to 25.
History
Among the first companies to offer fashionable walking, hiking and boating footwear.
Its mother company decided to extend the brand by creating complementary line of apparel. Because of the poor performance, it was decided to sold.
Style
Logo is marked with prosperous, active and fashion-conscious lifestyle.
Its main customers are not interest in its apparel.
Financial performance
Among the most profitable firms.
Had poor performance after acquisition by WCF.
Revenue contribution
42% of revenue from athletic shoes and balance from casual footwear. Revenue and operating income were 470.3 million and 60.4 million in 2006.
Revenue and EBITDA were 431.1 million and 51.8 million..
Products
Athletic shoes developed from high-performance footwear to