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Untitled Prezi

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on 24 June 2013

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CROCS: REVOLUTIONAZING AN INDUSTRY'S SUPPLY CHAIN MODEL FOR COMPETITIVE ADVANTAGE
A LOOK BACK
Founded in 2002 by Scott Seamans , Lyndon Hanson, and George Boedecker.
Crocs core competencies
Crocs core competencies lies within its -
Highly flexible supply chain
- Proprietary resources
- Custom configurations
To what degree do the alternatives in
question number two fit or contradict Crocs core competencies
C. E. O. Ron Snyder 2005-Present.
Purchased Finproject, a canadian manufacturer who manufactured the early product, later renamed Foam Creations.
Crocs flexible supply chain enables it to respond to the needs of its buyers quickly. Crocs can also increase product manufacturing and keep up with the demand on a weekly basis.
The acquisition of the company of Finproject allowed the company to own the resin croslite™, and established a strong competitive advantage over product manufacturing.
Crocs also delivers custom configure 24-packs colored footwear to meet the needs of its smaller customers
CROCS INC
How do they exploit these competencies in the future
The best way to continue developing their core competencies is to improve the croslite material and acquire more of the making of the croc footwear
a) Further vertical integration into materials
If Crocs were to integrate more vertically they would make the croslite, dye the material, mold the shoes and finally pack the crocs all within a close proximity to each other as opposed to different countries like they and other companies currently do.
b) Growth by acquisition
c) Growth by product extension
Acquisition of suppliers, some competitors and distributors. For extra production capabilities they should buy their contract manufacturers in Romania, Florida and China.
Crocs should expand their product line to athletic wear and casualwear.
Continue to create partnerships with existing shoe manufacturers.
* The ways that the alternatives fit the company’s core competencies would be by further
integration into materials and also product extension.
Getting to know the brand:
-
Trade shows in every industry:
-garden shows
-boat shows
-pool supply shows
-
Crocs personnel worked closely with stores
.
Developed a Supply Chain that provided a Competitive Advantage
-No limitation or time constraints in production and delivery
-Ability to adjust to changes during selling season
Financials
:
-Revenue from $1.2M in 2003 to $355M in 2006. Net income $64M (18% of revenue)
-Market cap of $1B at time of IPO. A year later, market cap $2.7B
-International sales went from 5% of revenue in 2005 to 25% in 2006
Product expansion and differentiation
:
-Original models: Beach and Cayman...62% of sales in 2006
-expanded to 31 different models including sandals, boots etc
-License agreements with Disney and universities such as: UCLA, Notre Dame, Ohio State
-Other products such as: caps, shirts, hats, socks, backpacks, kneepads, etc

A Closer Look At Crocs' Supply Chain
Snyder's background in tech manufacturing:
-Producing
WHAT
the customer needed,
WHEN
it was needed and
RESPONDING
rapidly to changes in
DEMAND
.
"If the product sells extremely well, we will
build more in season, and will be back on the
shelves in a few weeks. And we'll build even
more, and even more, and even more, in that
same season. we're not going to wait with a hot
new product until next year, when hopefully the
same trend is alive"
Phase one: Taking over Production
- Purchased of Foam Creations in 2004... proprietary croslite resin
-Kept Foam Creations supply chain with factories in Europe (Italy) and USA
Phase two: Global Production Using Contract Manufacturers
- Started production in China in 2005
-Later it added capacity through more contract manufacturers in Florida, Mexico and Italy
Phase three: Bringing the Global Supply Chain In-House
- Developed company-owned manufacturing operations in Mexico, Italy, Brazil and India due to the lack of flexibility and responsiveness from manufacturers outside of asia
- Changed its warehousing model.
-added warehousing operations to each factory
-Large orders... shipments directly from Chinese warehouse

CONCLUSION
*
Crocs has been trendsetters in the market
. They have produced their own materials which is one of the reasons why the speed of their final products are immensely quicker than those of other companies. So for them to further their integration into producing materials seems as it would be the appropriate move for the company.
*
Growth by extension
is also something that Crocs has taken advantage of in the past. They have produced caps, shirts, shorts, kneepads, just to name a few of the other markets that they have expanded into. Extension of products is a great way to stabilize a brand that will be around for years. If consumers find that one company can produce a variety of quality products they will be inclined to that variety of products from one trusted company as opposed to many different companies.
*
Growth by acquisition
as well has been something that the company has taken advantage of and can further benefit from. They have acquired suppliers in their company over the years to allow their business to run more smoothly and if they acquire more suppliers and distributors it can only make their business more successful. This would be one of the primary ways of efficiency of the business and would be recognized as a core competency.
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