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Harrington Collection Final Paper (MKTG 368W)

Harrington Collection Final Paper (MKTG 368W) - Financial...

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Financial Background After the financial results to the 2007 fiscal year were distributed, Harrington Collection yet again found itself with disappointing sales results. Over the past three years, the high end women’s producer of career and evening wear had not posted positive sales. This had forced the company to think about future solutions in order to recover. A possible solution was to extend their lines by adding an active wear collection. It had been brought to the company’s attention that “stylish, sporty, casual attire” was currently in high demand. After entertaining the idea, it was decided that they needed to collect information on the industry. They also needed to know how active wear merchandise was currently performing before they decide to expand. Fashion Industry The research they discovered was that the U.S. women’s apparel industry was highly competitive in 2007. Because of slow economic recovery, consumers were very selective about the things they bought and they searched for the best possible prices. In order to keep the product low in cost, many companies began outsourcing production overseas due to the lower manufacturing costs. This seemed to be an effective solution because the women’s apparel industry posted $133 billion in retail sales in 2007. The U.S. industry had found that there were 6 categories of apparel that were based on quality and price: 1) Haute Couture- high-end clothing custom-made for customers costing $10,000+. 2) Designer- high-end clothing available off the shelves costing $1,000+. 3) Bridge- includes career wear and dresses made from high-end fabrics costing under $1,000. 4) Better- includes sportswear, career wear, and dresses costing under $500. 5) Moderate- quality sportswear, career wear, and dresses for less than $100. 6) Budget- includes casual clothing like jeans and t-shirts costing less than $50. Harrington Collection is part of the “better” category and competes with names such as Jones New York and Liz Claiborne. Both Jones New York and Liz Claiborne had proven successful in the industry because they each had an extensive brand portfolio. Jones New York owned 8 other brands and Liz Claiborne owned 4. Each of their brands reached a new target market and each had its own price range that still kept itself in the “better” category or below. Both companies outsourced to other countries for production which helped decrease costs. To produce clothing in the U.S., there are 7 steps that must be used in order to be successful: 1) Branding- includes building and managing brands.
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2) Product Design- researching trends and creating new designs. 3) Buying- obtaining raw materials or hire manufactures to make all/part of finished product. 4) Production- all steps in assembling finished product.
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