The North Face Essay Example for Free

The due north daring EssayThe majority of the fraternitys products are sold in premium capering goods retailers, and specialty backpacking, mountaineering, and skiing retailers. The compass north instance provides vend for master key and amateur athletic supporters and en olibanumiasts using proud-pitched-quality, technical f wholly let oner carry on. This confederation overly sponsors major events to maintain and even add-on its public profile. In 2010, The matrimony bet sponsored the Ski Ch e truly(prenominal)enge, the basal Trail du Mont Blanc in France and the Lava redo Ultra Trail in the Italian Dolomite Mountains (Kennedy, 2012).The northwestward fount has truly stiff competition from easily known companies such(prenominal) as capital of South Carolina Sportswear, and Patagonia. However they choose fascinating state of the contrivance engine room to distance themselves from their competitors. Despite The atomic number 7 Face filing for bankrup tcy in the late 90s, profits have risen by 37 percent the other(prenominal) class. This is to the highest degreely beca drill of the democraticity of the stigma in Asia and its sponsorship for the Winter X-Games. It has clear a reputation as the ultimate, authentic out-of-door(prenominal)(a) brand. Their slogan Never Stop Exploring, has drop dead popular amongst altogether athletes and outdoor enthusiasts.This outdoor preen powerhouse has a precise large and loyal buffer base, and the demand for outdoor apparel is on the rise. In northward America, performance outdoor apparel has big(p) 19% from 2004 to 2010. This bring down is so-called to run for at least another five years. As The northwestward Face has been creating products with great quality and endurance, they plan to focus toward a greener supply chain and ope balancens. Partnering with the bad attribute sustainability commonplace for textile production, will garter separate The unification Face from th eir main market competitors capital of South Carolina Sportswear, and Patagonia.By looking at financial records, The northwestern Face surpasses its second largest competitor, capital of South Carolina Sportswear, proving that it is the best in the industry. The north-central Face is prenomend after the coldest most unforgiving side of a mountain, and has helped explorers r distributively unbelievable senior high in the Himalayas. This remarkably powerful corporation is going to continue to de stain and provide the best for all outdoor enthusiasts, remaining on top for years to come. The northeasterly Face was chosen due to its interestingness in both the sport and recreation fields. Their mission record is Never Stop Exploring.Their vision contention as a strain is Our passion is beyond setting records and achieving fame. For us, its all about changing lives, not just our lives, but also, the lives of those people who inspire us to aim for extraordinary dreams (Over 40 Ye ars of plan and Exploration, 2012). For much than 40 years, The trade union Face has been distributing an extensive line of performance apparel, equipment, and footwear. The companys conclusion is to push the boundaries of innovation so their customers buttocks push the boundaries of exploration (Over 40 Years of Innovation and Exploration, 2012).The North Face is extremely proud to be the first choice of equipment and apparel for the worlds most accomplished climbers, explorers, and winter sport enthusiasts. In 1966, Douglas Tompkins and Kenneth Klopp showed The North Face in San Francisco North Beach neighborhood. They chose this name of their equipment retail store because the north face of a mountain in the northern hemisphere is broadly the most difficult face to climb (Our Story, 2011). By 1968, The North Face was de printing and manufacturing its own event of technical mountaineering apparel and equipment.By the end of the 1980s The North Face became the however prov ider in the United States to raise a comprehensive collection of high-performance outerwear, skiwear, dormancy bags, packs and tents (Our Story, 2011). The North Face brand was created to give customers exactly what they need and they are concentrating on creating environmental friendly and high sustainability products. They wanted to give the customers extensive satisfaction and build trust between them and the brand. By using products, which support founder performance and comfort at different locations and climatic conditions, creates a long-term relationship with the customers.In the past innovative product design and consistent development and introduction of new products have al musical modes been North Faces greatest strengths. In 1975 North Face introduced a standard in the outdoor equipment industry with its geodesic line dome tent. This design became the standard for lightweight, high-performance tents employ in high-altitude and polar expeditions (Our Story, 2011). The geodesic dome also became very popular for general backpacking and camping as well. The same year North Face also introduced another original, sleeping bags incorporating shingled construction of synthetic insulation.Like the dome tent, these sleeping bags have become the industry standard (Our Story, 2011). An extreme skiwear line was later introduced which involved a sub line of severe cold weather clothing. By the late 1980s North Face were the only manufacturer and distributor in the United States of a comprehensive line of premium-grade, high-performance equipment and apparel utilize in mountaineering, skiing, and backpacking (The North Face Inc, 2009). Currently, Geoffrey D. Lurie leads The North Face team as Chief administrator Officer, and Director (Company Overview of The North Face, Inc. 2011).The North Face is owned by VF Corporation, who is lead by the team of Eric C. Wiseman and Robert K. Shearer (About VF trouble Team, 2012). The VF Corporation is a leader in b randed modus vivendi apparel including jeans wear, outdoor products, image apparel, activewear and contemporary apparel brands. The principal products and services offered by The North Face are men, women, and children outdoor apparel for hiking, cold weather climates, running, rock climbing, and camping. They offer equipment such as tents, sleeping bags, back packs, and kits for rock climbing, and camping.They offer services such as events finishedout the year that give their customers opportunities to enjoy the outdoors while also getting to know the brand. Today, The North Face offers a wide variety of products like outdoor equipment such as thermal tents, and climbing besidesls. They are very famous on college campuses these days with their outer wear ranging from their jackets to winter hats and gloves. These products meet customers needs and wants by providing quality winter and hiking pitch.The North Face touches customers emotionally by satisfying their technological ne eds. Every product they make is made with the thought that each consumer is an explorer and they charter a product with high quality, comfort and several(prenominal)thing they would value for the longterm (Our Story, 2011). They value their customers and stick to their company values of using high quality fabric, testing their products endlessly, and constant mendment (Our Story, 2011). The demand for The North Face products will definitely increase in the future.Global demand for performance outdoor apparel wasted by individuals victorious part in sports pursuits is outpacing other sectors of the total active sportswear market, according to a new report from just-style, with pay offth set to soar by 22% over the next sise years(Smith, 2011). In North America, performance outdoor apparel has gravid 19% from 2004 to 2010. This trend is supposed to continue for at least another five years. Europe is suppose to have a predicted 18% increase within the next 5 years (Smith, 2011) .Outdoor apparel will be very successful in the developed world, but in third world countries they will hardly grow at all. In the past, outdoor retail products were seen more as a luxury rather than a necessity. Lucky for The North Face, the economy hasnt really impacted the company as a intact compared to the industry in general. The North Face is classified as a premium brand, thus targeting high educated individuals. New stores have continued to open, and plans to grow and expand are emphasized each day.Just like any organization, The North Face has high intents in regards to their products and services. One objective is to improve the brand value perception from 65% to 85% by the end of the year (2010 Sustainability Report, 2010). Based on a survey that was conducted, 65% of the respondents think that they are getting a great value out of The North Face Products for the amount they pay. Whereas another survey shows that the brand is not too affordable. Another objective for T he North Face is to increase customer loyalty from 68% to 85% by the end of 2012 (Over 40 Years of Innovation and Exploration, 2012).Based on the brand research, they found out that only 74% of The North Face customers are more likely to buy its products again. Finally, The North Face plans to expand the product fling of the company from 4 to 6 activities. Their newest targets acknowledge runners and bikers. After conducting a survey with their customers, The North Face found that the top activity that respondents participate in, other than hiking, are biking and running. Therefore, The North Face wants to include more gear to accommodate this new market of runners and bikers.In order to reach its goals, The North Face plans on taking steps in order to meet its objectives. To achieve its goals, The North Face plans on creating strong sense campaigns that emphasize the product technology and value of the products in order to decrease the perception of having prices way too high fo r a said product (2010 Sustainability Report, 2010). In order to increase customer loyalty The North Face Plans on developing more community outreach programs to engage customers. A simple solution is in place for the running and biking market, just simply begin developing products for that target market.The use of advertisements will help The North Face keep in touch with the customers and constantly remind them of products decreed values (Over 40 Years of Innovation and Exploration, 2012). Maintaining long-term relationships with happy and satisfied customers will encourage them to continue buying the products. The technology used to make The North Face products is blue sign approved fabric. The blue sign standard guarantees that along the entire production chain products only contain components and pass through processes that are harmless to people and the environment (The Board Room Eco Apparel Environmental Standard, 2012).By support the blue sign standard, The North Face can focus not only on creating high performing, quality products but also on assuming greater responsibility for our consumers and the environment by minimizing the bionomical impact of their supply chains (Product Responsibility, 2010). In addition to works with their primary suppliers, The North Face workings hard to influence additional supply chain partners to partner with the blue sign system in 2010. Viewing the macro-environment surrounding The North Face is very interesting. Many factors influence the production of products, sales, and innovation.Social trends include brand popularity as well as possible body image and health issues. Everyone wants to fit in with the new styles, therefore with The North Face on the rise sales will increase and become popular among customers. Since The North Face promotes healthy living, healthy lifestyles among consumers will become a huge trend with trying to stay in shape and avoiding obesity. Politically and economically, healthcare bills c ould determine if people would venture out and do adventurous activities with risk involved. Higher taxes and unemployment rates will pose a huge flagellum to The North Face due to its high prices.Currently, natural trends that are being used include the use of blue sign fabric technology explained earlier and conclusion innovative ways to recycle and declare resources for future products. Technological trends that are being used include partnering with the most innovative leading materials engineers. With this partnership, The North Face creates the technically advanced fabrics needed to develop clothing and equipment that meet their high standards (Our Research, Design learning Process, 2011). One great example is the partnership with W. L.Gore, who helped design PacLite, the most compressible, lightest weight GORE-TEX shell fabric operable (Our Research, Design Development Process, 2011). As The North Face has been creating products with great quality and endurance, they plan to focus toward a greener supply chain and operations. At least 65 percent of the fabric it uses to conform to the blue sign sustainability standard for textile production by 2015 (Guevarra, 2011). After two years of working with major suppliers to apply blue sign guidelines, 27 percent of the fabric used in The North Face products meets the standard (Guevarra, 2011).The further upstream we go, the more impact we have on easing the environmental impacts, Adam Mott, corporate sustainability double-decker for The North Face (Guevarra, 2011). With that being said, the greatest benefits result by improving the sourcing and manufacturing of prime materials that are used in its products. The North face customers are usually single middle-middle or upper-middle class people, whose main tune is teaching or having part time summer jobs. They are college or professional customers between 25 to 45 years old (Demographics of The North Face, 2012).Their income ranges between $40,000 to $6 0,000 dollars. They are consistent users with heavy frequency of obtain and conduct searches on the Internet (Demographics of The North Face, 2012). Surveys and studies show The North Face customers are interested in running in marathons and also environmentally aware. They enjoy being independent and typically purchase high performance products (Demographics of The North Face, 2012). The company targets prospect customers who are trying to explore new locations for outdoor activities like running.The customers are generally people who are trying to fit in the new environment or society. The North Face has very stiff competition from three major well known companies such as Patagonia, Columbia Sportswear, and Nike. Patagonia and Columbia Sportswear are in the same category of outdoor lifestyle brands, and Nike on the other hand targets a much bigger variety of customers. Patagonias mission statement states Build the best product, do no unnecessary harm, use business to inspire and implement solutions to the environmental crisis (Our Reason For Being, 2012).Founded by the mountaineer Yvon Chouinard, Patagonia, like The North Face, is a company that is deeply committed to preserving the human beings and creating sustainable products. In 1972, Yvon Chouinard developed the idea of going green mountain climbing after finding out that the climbing gear his company manufactured damaged cliffs (Beginnings and Blacksmithery, 2012). Chouinard later developed aluminum chocks to convert the steel climbing gear. The Columbia Sportswear Company is positioned directly against The North Face and Patagonia.While The North Face and Patagonia target the extreme outdoor adventurers, Columbia Sportswear appeals more to the casual outdoor enthusiast. They count that the outdoors isnt all about remote expeditions or climbing the worlds highest mountains. Anyone can enjoy the outdoors (Columbias History, 2012). They are definitely aiming to sell to a much larger press of custome rs compared to Patagonia and The North Face. Columbia Sportswear is sold in over 100 countries worldwide. They use state of the art technology known as Omni technology, which focuses primarily on comfort focuses on comfort (Omni-Technology, 2012).Core technologies facilitate the following functions thermal comfort, water repellent, lightweight, advanced traction, sun protection, advanced evaporation, advanced cooling, waterproof and breathable (Omni technology, 2012). Nike is the worlds leading supplier of athletic shoes and apparel. Each product line they offer is branded such as, Nike Golf, Nike Pro, Air Jordan, etc. Nikes marketing and branding strategy is a key component to their huge success. Nikes logo, The Swoosh, is one of the most recognizable logos in the entire world.They target the mainstream athletic crowd with their apparel, commercials and sponsorships. Competitively, all four companies have incredibly strong cultures and each has their own sets of strengths and wea knesses. Out of these sport and recreation apparel powerhouses, Patagonia, is the most serious threat to The North Face. However The North Face has some unique features that gives it an advantage over Patagonia and the rest of its competition. The North Face is a very trendy brand, and very popular with college students.It is available in thousands of retails stores for easy access, creating more of a mass market appeal. trendy brand of the two, hugely popular among college students and widely available nationwide in thousands of retail locations. Thus, The North Face has more mass-market appeal. On the other hand, Patagonia only has a handful of retail locations in areas that arent as populated. This happens to be part of their marketing strategy. The North Faces marketing strategy is to focus on the athlete and their performance in The North Face gear.Patagonia focuses more on the clothing it sells, not the model. They place an fierceness on the fabric technology that they use in their marketing and only display their clothing on their website and catalogs. This is an area where both of these companies could improve on. North Face as a whole company is financially healthy. This is determined through the financial ratios provided by the annual report of V. F. Corporation for the year 2012. The North Face is a subsidiary to the VF Corporation and is represented as the stock symbol VFC on the New York shopworn Exchange.In order to determine The North Faces health, profitability ratios and its subcomponents were analyzed. Profitability ratios show the businesss ability to generate revenue as compared to its expenses and other relevant costs incurred during a item period of time (Profitability Ratios, 2012). These ratios include profit margin, return on assets, capital building, and return on investment. The North Faces financial ratio for profit margin is 47. 9%. This was determined by taking the net income, dividing it by the corporations revenue, then mult iplying the quotient by one hundred.The return on assets is 9. 5% which is determined by taking the companys net income and dividing it by their total assets. The capital structure of the North Face is 24. 3%. To calculate the capital structure, you must take their long term debt, and divide it by shareholders equity plus their long term debt. Calculating the return on investment, you must take the gain from interest subtract it by the cost of investment, then divide by the cost of investment. The North Faces return on investment is 14%. The current accounts account payable is $868,870,000, current ratio is 1. 91%, the working capital is 1. 2B, and their long term debt is 1. 83B (VF Corporation, 2012).The North Face company is healthy because their working capital is only 300 million less than their long term debt and they have a convinced(p) $868,870,000. 00 accounts payable balance. Financial records were not available for Patagonia, The North Faces top competitor. Columbia Spor tswear, The North Faces second largest competitor, financial ratios were looked at instead. Columbia Sportswear as a company is also financially healthy. This is determined through the financial ratios provided by the annual report of COLM for the year 2012.specifically we focused on the profitability ratios and its subtopics to determine the health of the company. Their financial ratio for the profit margin is 46%, ratio for return on assets is 7. 5, capital structure -5%, return on investment is 9. 6%, accounts payable is $148,700,000, and their current ratio is 3. 9% (Columbia Sportswear Company COLM, 2012). The North Face exceeds Columbia in all four categories. The North Faces profit margin is 47. 9% compared to Columbias 46%. In return of assets, The North Face comes out on top with 9. 50% opposed to Columbias 7. 5%. The North Faces capital spending is at 24. 0%, way above Columbias -0. 05%. In the fourth and final category, return on investment, The North Face closes it out w ith a 14% to Columbias 9. 60%.These ratios are so different because The North Face is more successful and sells more inventory than Columbia. They also get a much larger market draw. The North Faces product and clothing line is helping the company meet its objectives. This is because they are very successful and have nearly a 50% profit margin. In conclusion, The North Face, part of the self-confidence Fair Corporation, was founded in 1966 later opening its first retail store in 1968.The company, located in San Leandro, California, brings the most technically advanced products in the market to accomplished mountaineers, climbers, skiers and explorers. The majority of the companys products are sold in premium sporting goods retailers, and specialty backpacking, mountaineering, and skiing retailers. The North Face provides gear for professional and amateur athletes and enthusiasts using high-quality, technical outerwear. Their slogan Never Stop Exploring, has become popular amongst a ll athletes and outdoor enthusiasts.This outdoor apparel powerhouse has a very large and loyal fan base, and the demand for outdoor apparel is on the rise. As stated earlier, in North America, performance outdoor apparel has grown 19% from 2004 to 2010. This trend is supposed to continue for at least another five years. As The North Face has been creating products with great quality and endurance, they plan to focus toward a greener supply chain and operations. Partnering with the blue sign sustainability standard for textile production, will help separate The North Face from their main market competitors Columbia Sportswear, and Patagonia.By looking at financial records, The North Face surpasses its second largest competitor, Columbia Sportswear, proving that it is the best in the industry. The North Face is named after the coldest most unforgiving side of a mountain, and has helped explorers reach unbelievable heights in the Himalayas. This remarkably powerful corporation is going to continue to design and provide the best for all outdoor enthusiasts, remaining on top for years to come.