patagonia 6 month buying plan

17

Patagonia offers employees the ability to take off from their regular roles for up to two

months, to work for the environmental group of their

choice while continuing to earn their paycheck and benefits.

This is so beneficial to both the Patagonia and the grassroots company that is gaining a free

intern. And when interns return, they bring back stories, inspiration and a new

commitment to Patagonia’s environmental mission.

EnvironmentalInternship Program

TARGET CUSTOMER PROFILES

36

SingleCharlotte, NCStudentFinancially dependent on parentsAchieverActive, Greek LifeStyle: Current and preppy

Hannah Kelley, 21

Target Customer Profiles

37

Mike Stanton, 27

SingleMaui, HI

Physical Education TeacherIncome: $52,000

InnovatorOutdoor Enthusiast, Surfer, Hiker

Style: Comfort over style


38

MotherDenver, COPhysical TherapistHousehold Income: $110,000ExperiencerSkier, Nature LoverStyle: Quality before fashion

Erin Murphy, 35


39

Dave Williams, 64

MarriedCape Cod, MA

RetiredThinker

Active, Fisherman, GolferStyle: Comfort and functional


41

STRENGTHS

Strengths

Employee Committment

Environmental Involvement

Quality Products

Customer Service

Transparent Manufacturing

Innovative Marketing

43Strategies for Growth

STRATEGIES FOR GROWTH

Expansion TechnologyNew MarketsYvon Chouinard was recently a speaker at a responsible fishing convention, where he discussed

sustainable ways to harvest salmon and why understanding your supply chain, regardless of what industry you’re in, is important. He left that convention incredibly frustrated

because nobody understood what he was talking about. So, at 75 years old, Chouinard decided to branch out

into the fishing industry and create Patagonia Provisions. He is setting up sustainable fishing farms and

proving to everyone that caring for the environment is the most effective way to run a business. With initiative like this, Patagonia has the ability to

branch out into a variety of new markets.

Patagonia has developed and integrated technological advances within their products. For example,

they already have fabrics that prevent bacteria growth and protect against UV rays. Additionally, they have created portable self-inflation

vests for their wetsuits. With the continual rise of wearable technology in today’s society, Patagonia has the

potential to continue to develop products that integrate the use of technology. As consumers become more dependent on technology, it is imperative to incorporate this way of life within Patagonia’s own prod-ucts. There is major opportunity to

expand with technological advances while still remaining sustainable and

eco-friendly.

Patagonia has the opportunity to expand into a multitude of different locations worldwide. Even though

they are a hugely successful company, they only have roughly 50 stores globally (this, however, does not include the number of vendors who sell Patagonia merchandise.) The most shocking statistic is that

there are only two Patagonia stores in Canada. With the cold climate and a bustling ski industry, Canada is a profitable market for Patagonia, and it seems a waste of resources to not

have more than two stores in the country. Patagonia has the

opportunity to expand into new marketplaces.

KEY COMPETITORS

47Key Competitors

HOW THEY STACK UPStrengths -Columbia contributes to large scale and grassroots environmental organizations, like the Conservation Alliance as well as smaller organizations like Save the Seagrass. - They also employ a solar electric system at their headquarters in Portland, OR that is working hard to reduce their carbon emissions. - In addition to environmental projects, they donate money to a number of other medical and social organizations, promoting things like gender equality and healthier lifestyles for children. Price Point -In comparison to Patagonia, Columbia offers similar products at a lower price point.

Product Categories

MenWomenChildrenFootwear

Activity Gear

Venues

Columbia Retail StoresColumbia Outlet Stores

Select Department Storeswww.columbia.com

“Columbia is made up of real

people who are as passionate about

the outdoors as you are.”

49Key Competitors

HOW THEY STACK UPStrengths - Clothes The Loop is an environmental program set up by The North Face company to help promote textile recycling. The program offers rewards to customers if they donate clothing to participating retail stores, as a way to help reduce the amount of clothing waste in the United States. -North Face reports sales at $2 billion and by 2017 they expect to increase sales to $3.3 billion.

Price Point -In comparison to Patagonia, The North Face has price points within the same range of Patagonia.

Product Categories

MenWomen

Boys / GirlsFootwear

Equiptment

Venues

TheNorth Face Retail Stores

The North Face Outlet Stores

Mountain Althletics Stores

Summit Series Stores

Dealer Stores

www.thenorthface.com

51Key Competitors

HOW THEY STACK UPStrengths - From their headquarters in Utah to their factory in China, they are committed to complying with the highest standards of social responsibility at all operations. - Twenty percent of the power used at their Salt Lake City office, home to their headquarters and manufacturing facilities, is wind generated. - Black Diamond is an active member of the Outdoor Industry Association’s Sustainability Working Group, dedicated to advancing industry standards on environmental and social responsibility. - Black Diamond, Inc. supports numerous organizations and efforts to preserve the places where we climb, ski, and trek.

Price Point -In comparison to Patagonia, Black Diamond has price points within the same range and higher of Patagonia.

Product Categories

MenWomen

Climbing EquiptmentSkiing Equiptment

Venues

The Black Diamond Retail StoreRetailers

www.blackdiamondequipment.com

“To champion the preservation of, and access

to, mountain, crag and canyon environments

while minimizing our own environmental footprint.”

53Key Competitors

HOW THEY STACK UPStrengths - Marmot’s CityTech Collection boasts uptown looks with backcountry performance. - All Marmot products that contain recycled polyester are labeled UpCycle® - They have a complete shirt line that is certified according to the Global Organic Textile Standard (GOTS). - Marmot does not support the use of Down from live pluck or Foie Gras geese or ducks.

Price Point -In comparison to Patagonia, Marmot has price points within the same range of Patagonia.

Product Categories

MenWomen

BoysGirls

Equiptment

Venues

Marmot Flagship StoresAuthorized Retailerswww.marmot.com

“To create fair human working

conditions, to support social initiatives

and to foster a multi-cultural company

philosophy; To produce the best

outdoor equipment which meets the

expectations of mountain professionals

and enthusiasts; To produce

environmental friendly products and

foster a global ecological awareness”

55Key Competitors

HOW THEY STACK UPStrengths - Arc’teryx offers repair services worldwide, they repair over 10,000 used Arc’teryx items per year. - Arc’teryx is a Bluesign system partner. - Arc’teryx maintains a detailed Restricted Substances List (RSL) that specifies a broad range of materials not permitted for use in their products due to environmental, health, or occupational safety reasons. - They partner with some great organizations to help achieve positive impacts beyond the reach of their day-to-day operations

Price Point -In comparison to Patagonia, Arc’teryx has price points within the same range of Patagonia.

Product Categories

MenWomen

BoysAccessories

Climbing GearPacks

Venues

Arc`teryx Brand StoresAuthorized Retailerswww.arcteryx.com

“Delivering unrivalled performance, Arc’teryx

quality conveys absolute confidence. PURSUE

PERFECTION: Design/Craftsmanship/Performance.”

LIFESTYLE TRENDS

59Lifestyle Trends

GET FIT

After many years of struggling with negative body image within the fashion industry, we are finally starting to turn that around. In the early 2000s, much of the fashion industry

was known for ads involving women who were far too skinny. This went beyond advertisements and consumed the entire industry with a barbie-like stereotype.

It’s about time the fashion industry started stripping themselves of this idealistic image. Having such an impact on young women through magazines and advertisements, the fashion industry is one of the most powerful influencers of the minds of young women.

The New Femininity is strong, natural, and healthy; one that empowers a woman’s body, her curves, and her self acceptance.

Many active wear campaigns are embodying a woman who is strong above skinny, and most importantly, comfortable in her own skin. With activewear taking over fashion and

almost becoming everyday wear, women are listening.

Being an athleisure company, Patagonia fits perfectly within this trend and provides products that fit perfectly within the athleisure lifestlye.

61Lifestyle Trends

GO GREEN

Sustainability is the trend of the 21st century. Being eco-friendly has now become a way of life. More than ever, people have become more conscious about the environment

and the impact society has on it. Consumers are more eagerly looking to buy products that appear to be better for the environment.

Patagonia has been in front of this trend for years now, looking to make the least carbon footprint as possible when producing their products. Doing everything in their

power to become eco-friendly, from promoting consumers to repair products instead of buying new ones to encouraging employees to car pool and ride their bikes to work,

Patagonia’s underlying mission is to go green.

Being in front of this trend gives Patagonia a leg up on the competition who are actively trying to catch up to their eco-friendly attitudes and practices.

WOMEN’S OUTERWEAR TRENDS

64 Women’s Outerwear Trends

KEY ITEM: THE FLEECE ZIP-UP

•Boxy Silhouette

•Easy Movement

•Minimal Lines

•Weatherproofing for

Extreme Conditions

•High Performance

65Women’s Outerwear Trends

KEY ITEM: THE PARKA

•Slimmer Fit

•Padded for Warmth

•Classic Detailing

•Weather Protection

•Storage Pockets

•Technical Trims

66

KEY ITEM: THE PUFFER

Women’s Outerwear Trends

•Boxy Fit

•Durable

•Performance & Style

•Transitional

•Protective Collar

•Graphic Checks

67

KEY ITEM: THE GILET


•Simplified Silhouette

•Performance Zips

•Outdoor Appeal

•Insulation

•Cargo Pockets

•Technical Trims

69

KEY DETAILS

Materials & TexturesFeatures Fashion Colors


•Tweeds

•Fleece

•Lacquered Finishes

•Patterned Quilting

•Waterproof Fabrics

•Wovens

•Media Storage

•Statement Zippers

•Vintage Finishes

•Reflective Accents

•Customized Fit

•Extended

Protection

•Cardinal•Cerise

•Green Glass•Dusk Blue

•Navy•Damson•Prune•Taupe

Core Colors

THE 6 MONTH BUYING PLAN

73

Fall 2015

Planned Net Sales, Fall 2015

13000.0

Est. Net Sales, Fall 2014 11500.0Plan % Last Year 13%Average Stock, Retail 7632.7Inventory Turnover 1.7Planned Reductions, $ 1300.0Reductions, % Sales 10%Plan IMU % 54%

The 6 Month Buying Plan

THE CORPORATE PLAN

74

(000’s) August September October

Net Sales1820.0 2340.0 1950.0

% Fall14.00% 18.00% 15.00%

Plan BOM Stock6916.0 7722.0 7410.0

Stock/Sales Ratio3.8 3.3 3.8

Plan EOM Stock7722.0 7410.0 7956.0

Plan Reductions104.0 195.0 195.0

% Fall 8.00% 15.00% 15.00%Purchases, Retail 2730.0 2223.0 2691.0Purchases, Cost 1255.8 1022.58 1237.86


75

November December January Fall 2015

2340.0 2730.0 1820.0 13000.0

18.00% 21.00% 14.00% 100%

7956.0 8463.0 7462.0 7632.7

3.4 3.1 4.1 3.6

8463.0 7462.0 7500.0 6644.7

286.0 325.0 195.0 1300.0

22.00% 25.00% 15.00% 100.00%

3133.0 2054.0 2053.0 14884.0

1141.18 944.84 944.38 6846.6The 6 Month Buying Plan

77

Fall 2015Plan Net Sales, Fall 2015 600.0Est. Net Sales, Fall 2014 530.0Plan % Last Year: 13%Average Stock, Retail: 323.1Inventory Turnover: 1.86Planned Reductions, $: 60.0Reductions % Sales: 10%Plan IMU %: 54%


VENTURA, CA STORE PLAN

78

(000s) August September OctoberNet Sales 96.0 102.0 90.0

% Fall 16.00% 17.00% 15.00%

Plan BOM Stock 316.8 326.4 315.0

Stock / Sales Ratio 3.3 3.2 3.5

Plan EOM Stock 326.4 315.0 334.8

Plan Reductions 4.8 9.0 9.0

% Fall 8.00% 15.00% 15.00%

Purchases, Retail 110.4 99.6 118.8

Purchases, Cost 50.784 45.8 54.6


79

November December January Fall 2015108.0 120.0 84.0 600.0

18.00% 20.00% 14.00% 100%334.8 348.0 310.8 323.1

3.1 2.9 3.7 3.3

348.0 310.8 310.0 277.9

13.2 15.0 9.0 60.022.00% 25.00% 15.00% 100.00%

134.4 97.8 92.2 653.261.8 45.0 42.4 300.5


81

Fall 2015Plan Net Sales, Fall 2015 433.3Est. Net Sales, Fall 2014 385.0Plan % Last Year: 13%Average Stock, Retail: 247.7Inventory Turnover: 1.7Planned Reductions, $: 43.3Reductions % Sales: 10%Plan IMU %: 54%

DENVER, CO STORE PLAN


82

(000’s) August September October

Net Sales 60.7 73.7 65.0

% Fall 14.00% 17.00% 15.00%

Plan BOM Stock 230.5 243.1 240.5

Stock / Sales Ratio 3.8 3.3 3.7

Plan EOM Stock 243.1 240.5 250.4

Plan Reductions 3.5 6.5 6.5

% Fall 8.00% 15.00% 15.00%

Purchases, Retail 76.7 77.6 81.5

Purchases, Cost 35.3 35.7 37.5


83

November December January Fall 2015

73.7 86.7 73.7 433.3

17.00% 20.00% 17.00% 100%

250.4 268.6 250.4 247.7

3.4 3.1 3.4 3.5

268.6 250.4 250.0 214.7

9.5 10.8 6.5 43.3

22.00% 25.00% 15.00% 100.00%

101.4 79.3 79.7 496.1

46.6 36.5 36.7 228.2


ASSORTMENT PLANS

86 Assortment Plans

PRODUCT ASSORTMENT

87Assortment Plans

88

Planned Purchases, Retail: $14,884,000 Average Retail Price: $207.50

% $ Unit

Sizes Total Purchases Purchases

XS 10% $1,488,400 5954S 20% $2,976,800 11907M 25% $3,721,000 14884L 25% $3,721,000 14884

XL 10% $1,488,400 5954XXL 10% $1,488,400 5954

100% $14,884,000 59536

Assortment Plans

89

% $ Unit Avg.

Classification Total Purchases Purchases Retail

Fleece 35% $5,209,400 40072 $130

Soft Shell 25% $3,721,000 18605 $200

Down 25% $3,721,000 14884 $250

Waterproof 15% $2,232,600 8930 $250

100% $14,884,000 82492

Assortment Plans

91

STATEMENT OF RISK

Statement of Risk

We carefully looked at the past sales figures from Patagonia and analyzed our market the best we could. However, with a planned 13%

increase of sales, it’s possible that we have planned too much of a sales increase for this year. Patagonia is always encouraging people not to buy new things, but to reduce their consumerism and recycle the things they

already have. In the past few years, people have been rapidly purchasing jackets from Patagonia, and it is possible that our environmental message has finally reached the community and our projected sales could plateau instead of increase. Despite this singular posibility, we believe that our

sales plan forecasts an accurate increase in sales for the upcoming year.

93Resources

RESOURCES

http://www.patagonia.com/us/home

https://www.linkedin.com/company/patagonia_2

http://www.wgsn.com/home/

http://www.columbia.com

http://www.thenorthface.com/en_US/index.html

http://blackdiamondequipment.com

http://marmot.com

http://arcteryx.com/Home.aspx?language=EN

http://www.bloomberg.com/research/stocks/private/snapshot.asp?privcapId=7901350

http://www.wsj.com/articles/why-fashion-insiders-are-buzzing-about-patagonia-1420825704

6 Month Buying PlanWomen’s Outerwear Fall 2015Shandy Frey, Georgiana Knox, Ashlee ScottFASM 245 / Winter 2015

patagonia 6 month buying plan

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