Strategy Management for Market of Patagonia- myassignmenthelp

Question: Discuss about theStrategy Management for Market of Patagonia. Answer: Introduction: The market of Patagonia is essential in understanding their necessity for the principle of driving sustainability across the organization. It generally sets the background for seeing reasons on why any organization operating within the outdoor market segment should endeavour in protecting the planet and performing business activities. The segment of global apparel and outdoor industries have been on the rise since 1960s, with the market analysts estimating the fact that the present segment of performance apparel has been growing at double the pace of the total sector if sports apparel. Performance apparel is stated to grow at a rapid rate for men than that of women in regions like East Asia, Europe and North America. As consumers have been demanding clothing of multi-functional nature, new competitors have been entering the market of performance apparel (Hvass 2013). This report would take into account the external environment along with the core competencies of the company in the ou tdoor clothing industry. External environment and industry competition within outdoor active lifecycle clothing industry Political: This mainly has to do with the political environment prevailing within a particular country. It is generally being supposed that is the temperatures of politics are down, business tends to thrive. Companies do suffer entry approach regulations, rights of intellectual property along with certain taxation laws. One of the key reasons the outdoor active lifestyle of clothing industry had been facing a rise and fall is for political unsteadiness. The economy is generally intervened by the policies and laws that is issued by the government resulting in several ups and downs within the industry (Sinha and Foscht 2016). The laws take in recycling of the waste materials, policies related to import, trade and export having major impact on the outdoor clothing industry. The clothing industry is also being affected by the regulations and rules related to the taxation with modifications in these rules existing within the countries impacting the growth of the economy of the outdoor clothing indus try. Economic Factors: The industrys economic growth is generally seen in the high time, when the rate of interest is much lower, the sales are stated to be superlative with larger profits been seen. Not only this fact but the rate of inflation along with the exchange rate has also been influencing the outdoor clothing industry. Another key factor is the credit crisis that is stated to be not only an issue for the producer but for the buyer as well. Social Factors: The outdoor clothing industry is mainly being affected by peoples social behaviour along with their attitude towards the product. The difference that exists in the culture along with the peoples attitude towards factor of career affects the industry. The labour cost also depends on the society, affecting the companys sales. Many of the social causes like the rules and regulations against the child labour have also been affecting the outdoor clothing industry. Adding to that is the trend within fashion that is being changing ever so quickly has been leading the outdoor clothing or apparel industry to take into consideration and alter their products as per the need (Carroll and Buchholtz 2014). Technological Factors: With technological advancement, the approach that is being used by the outdoor apparel industry has altered that has been able to speed up the development however augmenting the cost factor as well (Keiser, Garner and Vandermar 2017). The technological factor might also be affecting the outdoor apparel industry through defining of the accessibility of the resources along with their resources and their most favourable use. The process that is being used currently is primarily automatic, though not every owner would be able to use it for the amplification in the cost. Legal Factors: Many of the social activists were seen following the owners of the garments industry for the issue of the child labour along with many of the legal activities that were being held consequently. Some of the other legal issues have been related to the laws and policies that were being held by the government. Environmental Factors: Issues related to product recycling have remained complex for the apparel industry in helping keeping the environment clean. Other key issues that have been affecting the industry are global warming and the clearance factor of some of the ordinary resources in producing the clothes. In this present era, organizations need to have stricter store policies of the waste materials or the by-products. They need to issue a yearly or quarterly report on the activities deemed environment friendly along with the processes. This provides government with the assurance of the commitment of organizations in producing products that are environment friendly. Industry Competition: Patagonia has been a successful company, though it has been facing stiff competition from The North Face, Marmot and Columbia Sportswear. The North Face that was founded by Doug Tompkins in the year 1968 is being stated to be the biggest competitor of Patagonia, being able o builds a trusted name among the enthusiasts of outdoor recreation and other trendy urban dwellers (Matzler, Veider and Kathan 2015). The line of products in the North Face takes into account backpacking backpacks, something that has been missing from the lost of Patagonia. This item is what sets The North Face apart from Patagonia. Adding to that is the fact that The North Face tags on with Patagonia when it comes down to environment sustainability. However, Patagonias environment sustainability along with company transparency is much more if compared to The North Face. Columbia Sportswear has been another big competitor of Patagonia that was founded in 1938 by Paul Lamfrom, a company that has been in the business 30 years prior to Patagonia. This provides Patagonia with the opportunity of more customer loyalty across multiple generations. Columbia Sportswear has been a public owned company and is much bigger than Patagonia, though both the companies have varied target market. The products of Columbia are stated to be more affordable, facilitating them in tapping into the markets that consists of lower income group of people. As per Lee, Seifert and Cherrier (2017), both the company matches in the fact that they manufacture top quality apparel, though it has been seen that Columbia Asia is not that involved in the aspect of environmental sustainability facet of designing products and developing the same. Critically discuss Patagonias resources and competencies for gaining competitive advantage Taking into consideration Patagonias operations, it can be stated that the firm has been operating making use of the resources and organizational potentials to their fullest. Patagonia produces company value through their acquainted use of the primary along with the secondary activities. Their efficient operations of plant have been adding value to their business. Porters Five Forces: This study has been conducted in collecting efficiently within the marketplace that fits Patagonia within the market of outdoor apparel. It is important to understand the industrys competitive intensity, probable new entrants, and substitutes of those products, customers influence and suppliers on the firms activities. Competition Intensity: Patagonia is generally present on many of the Strategic Business Unit, inclusive of the outdoor clothing sale. This sector of outdoor clothing boasts of multitude of actors. Patagonia thus face competition from three companies, with the main being Columbia Sportswear, stated to be the leader in this market. Its activities are generally diversified in the outdoor clothing industry (Carbonaro and Goldsmith 2014). Patagonia exists within an industry that is highly competitive, along with the size of dozen firms that are either smaller or larger. However the company does have a feature that differentiates it from the competitors, providing it with stronger competitive advantage (Oeppen and Jamal 2014). The company has aimed towards protecting the environment and it does not make use of the materials generally used by its competitors like the organic cotton. Patagonia has been the first brand that is being identified as making use of global ecological textile. Potential customers have perceived the brand in varied ways from that of Patagonia and in remaining a leader in generating environmental friendly clothing, Patagonia posed entry barriers in the shape of patents over fashion designing methods and making use of certain materials like Capilene (Kant Hvass 2014). New entrants: The instance of Patagonia begins steadily to be imitated. Companies like Nike have been using 3 per cent of organic cotton in their T-shirt designing, however, Patagonia, the specialist in outdoor clothing is more than ready in developing necessary funds for environmental friendly clothing and performing actions on the environment as being done by them for the past 20 years. So, it can be stated that the competitive advantage of Patagonia is generally not jeopardized by the over potential new entrants. The outdoor clothing market has generally remained open. For over 50 years the sector of outdoor clothing has been of extensive nature in the field of sports, and only signs offering clothing to quality acting and utility of sport within the market. But presently the situation has altered along with the detonation of the market for the outdoor activities for augmentation in free time, bringing in the companies that are new for providing products outside the sports genre (Ward 2017). Substitution Products: Patagonia manufactures outdoor clothing that is being dedicated to the 5 world of sports that are skiing, mountain climbing, hiking, fly fishing and climbing. Patagonias offered clothes are perfectly being suited with the practice of the sport. However, trends within the community of sports do change and so does the dress code. Patagonia needs to fight against the various brands not only in the segment of sports but also within the clothing segment streetwear in their outdoor clothing marketplace. These alternatives are often stated to be cheaper than the products of Patagonia for weaker presentation, as it is generally easy for people, particularly the backpackers in obtaining the substitute products from the house of Patagonia (Carneiro et al. 2014). Within this the substitute products are real threat to Patagonia, but as the competitive products and new entrants, they would not be affecting the firms competitive advantage. Power of customers: Patagonia is an organization that is unique within the vast textile fields. This is why the customer base of the company is stated to be specific in meeting the specific criterion. The clients range is generally small and quite concentrated with most being loyal to the brand for most of the part, forcing the brand in properly evaluating their request for not disappointing and weakening their loyalty. They are not in the habit of buying in larger quantities, and given Patagonias quality product on time, it is essential for the brand in innovating for maintaining the charm of its customers for the products. Power of Suppliers: Patagonia has been in association with more than 160 suppliers for producing the wider range of outdoor clothing. Relationship existing between the firm and the partners has not been frequent as Yvon Chouinard insists on the fact that trust and mutual govern these reports. For instance, since the year 1996, Patagonia has been making real cuts in the profits through recognized sympathetic relationships with the farmers producing organic cotton struggling in selling their crops. Patagonia has been agreeing in allocating 10 per cent of its turnover in the areas of research and development for exchange of constancy of some of the suppliers. Core Competencies: The main desire of Patagonia has always been in building the best product while continuing its major contribution towards the environment where they play. Their core values consist of quality stating detection of ever-greater quality in everything they perform, and integrity facilitating relationships that is being built on respect and integrity (Resta et al. 2016). Adding to that is environmentalism factor serving as a catalyst for corporate action. Patagonias current mission statement can support its growth and expansion strategies Patagonias Mission Statement: The mission statement of Patagonia states, Build the best product, cause no necessary harm, use business to inspire and implement solutions to the environment crises. Patagonia grew out from being just the small organization that was in the habit of making tools for the climbers. Alpinism still remains at the heart of the global business scenario still making clothes for climbing along with skiing, surfing and snowboarding, trail running and paddling. These are all generally silent sports. None of these requires a monitor; none distribute the cheers of the crowd. The values of the company have been reflecting those of a business that was started off by a climbers band and surfers, promoting the minimalist style. The advancement taken by the company towards designing of the product illustrates a bias for efficacy and minimalism. Patagonia believes in saving the wild and beautiful places out of the love they have for the same, helping reverse the sheer decline in the total environmental health of the planet. As per Sinha and Foscht (2016), the company has been donating their time, services and around 1 per cent of their sales to the existing hundreds of grassroots environmental groups across the world who works in helping reverse the tide. The company understands that their business activity ranging from lighting stores and dyeing shirts generates pollution as by-product. The company has been working steadily in reducing those harms. They have been making use of the recycled polyester in most of their clothes and only organic, instead of the pesticide-intensive, cotton. The company has been able to stay true to their core values during their thirty-plus years of business, helping them in creating a company that their employees are proud to run and work. Their primary focus has been on making the best products that is generally possible that has given them success within the marketplace. Patagonia strives hard in lessening the harmful practices within the environment in every facade of production along with clothing allotment (Lee, Seifert and Cherrier 2017). Patagonias mission statement has been built exactly on the things they perform at marketplace. While participating in the activities within extreme terrain and perfidious weather, one requires quality products in keeping them safe and performing the same at the highest level. Money and materials are required in making the products required in performing at the highest possible level within any condition. Patagonia is a company that requires labelling their products at high price to meet the ends of producing this high-end clothing, while remaining focused on giving something back to environment and manufacturing products that are less harm to environment (Finster and Hernke 2014). There is no need to alter the mission statement of Patagonia as they have doing a splendid job in maintaining a balance between the mission statement and the things they do to market their products (Carroll and Buchholtz 2014). It has been doing its bit in saving the environment and manufacturing quality products that has helped in facilitating the company with desired market share. SWOT evaluation of Patagonia SWOT analysis of Patagonia Strengths: Being one of the private companies facilitates freedom in innovating in line with the mission of Patagonia. But it is their internal association that lengthens far beyond the doors of their headquarters in Ventura. Their assurance towards integrity leads towards lasting relationships with the customers and suppliers, the improvement of Fair Labour Association, 1 per cent for the planet along with the Conservation Alliance (Kant Hvass 2014). Their translucent communication across all the channels of stakeholders drives the growth of the company every year. Advertising at Patagonia has always been a low priority with their success rate in the last decade being attributed to the awareness of brand. The commitment of Patagonia is developing a hand-like model of inspection continues enhancing the intent and materials of their products. Their focus on building the best possible product since the 60s turned a logical property and intangible asset into strength. Weakness: One of the biggest drawbacks of this company has been their reliability towards useful and resilient products where compromising quality for the purpose of more eco-friendly options becomes complicated (Lee 2017). Their commitment in building the best product regularly brings them to a crossroad. Polyester that is derived from oil is not renewable. Employees need to establish whether the harm sourced by the production and usage of polyester is necessary or not. Opportunities: The surfacing of the outdoor industry within the last decade has attracted a broader range of individuals. The brand of Patagonia has been able to efficiently create its own lifestyle, one that becomes easier in associating with for the people interested in extreme outdoor sports. The segment of apparel alone captured approximately 35 per cent in the outdoor industry. Patagonia does have a chance in capturing the new customers minds and hearts within the industry. It is expected that the global sales would increase over 18 billion dollars by the end of 2018; the segment would be increasing the share of market of overall segment of sports apparel. Threats: It is important to understand the present threats facing Patagonia: the climatic change. It might be possible for the world to adapt, though the exacting elements of the outdoor industry might cease to exist when there are major changes to transpire. The prolongation of the economic crisis might seem ok for the brand Patagonia, the company has been claiming consumers does make longer lasting buying during the process of decline (Hyun-Nam Lee and Ha-Brookshire 2015). Yet, if Patagonia truly considers in forming a sustainable future, everybody needs to prosper. They might find it easy in educating customers during tough times; but customers might not listen when their security is endangered. Conclusion: The company is doing great with it promoting the idea of the company should buy and consume fewer amounts of products. It does advocate a basic lifestyle through its cutting-edge technology in manufacturing of clothes and minimalist design, however marketing a naive lifestyle through its continuous dedication towards sustainability. Its use of environmental friendly fibres has been the success factors on sustainability. References: Carbonaro, S. and Goldsmith, D., 2014. 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