Case Study 1

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Rutgers University, Newark *

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STM101

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Business

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Feb 20, 2024

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pdf

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Crocs Case Writeup Crocs, a footwear company known for its iconic clog shoes, faced significant challenges in managing its supply chain during its early period of explosive growth. The challenges that the company faced included rapid and unpredictable demand fluctuations, traditional footwear industry supply chains being inflexible and slow to respond to changing trends, leading to inventory issues & and missed opportunities, and reliance on middlemen for sourcing and manufacturing. These challenges made it difficult for Crocs to cope with rapid growth and to compete effectively. Crocs implemented a unique and flexible supply chain model to address these challenges. To maintain that competitive edge, Crocs expanded globally at the very beginning of its journey. The model that Crocs implemented involved direct sourcing and manufacturing control, cross-functional collaboration, enabling rapid production adjustments for different styles and colors, capacity expansion for the increase in production volumes, and Direct-to- retail distribution which helped reduce inventory holding costs and distribution time to the market. The company was able to respond quickly to the in-season demand thereby reducing the need for the retailers to place all of their orders before the season starts. They also figured out a way for product postponement. To retain its competitive edge, Crocs must continue to leverage its supply chain model. Meanwhile, it should focus on further vertical integration of its supply chain. Crocs can also focus on deviating from its image of just funky fashion wear items. The company already has a diverse product portfolio and hence the better alternative would be to expand via acquisitions. For example, the acquisition of Jibbitz helped Crocs to enhance its funky look while giving a sense of personalization to its customers. The company must also focus on telling their story in a more innovative manner.
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