Edwinn Matonis MGMT 411 Professor Cline Industry Analysis: Crocs Case

Matonis 2 Executive Summary: Crocs is a footwear company founded in 2002 by three sailors and solidified by their business partner. customer needs. and retailers. Crocs was able to deli!er a !ariety of consumers a $uality product $uic#ly with minimal strain. supply chain acti!ities. %ow should Crocs differentiate its products to pre!ent itself from bein o!erta#en& %ow should Crocs le!era e its competencies in production. %owe!er. mar#et trends. "y focusin on their product attributes. and infrastructure to come out ahead of their ri!als& "y constantly watchin and ad'ustin to mar#et trends. addin !alue. Ronald Snyder who later became the CEO. and by spreadin into new mar#ets and se ments. . Crocs is now bein threatened by other industry ri!als for mar#et share. despite these superior ad!anta es. mar#etin . Throu h a series of business initiati!es. Crocs can ensure itself lon (term success in the footwear industry. inbound lo istics. impro!in and le!era in its supply chain competencies. Crocs was able to o from bein sold in small !enues to bein in hu e outlets all throu hout the world.

'I! Internal/External Com0any Analysis (S12T+####!Pa$e 3 'II! Alternatives##################!!!Pa$e 4 'III! 5ecommendations############!!###Pa$e 16 .Matonis ) Ta le of Contents: I! II! "istory####################!!!Pa$e 4 %usiness Pro$ression###############Pa$e 4 III! Case Issues###################!Pa$e & I'! External Analysis (Porter)s *ive *orces+#######Pa$e . '! Internal Analysis ('alue C-ain+##########!!Pa$e .

a company that created a !ariety of products and held within the company. 0ortunately.Matonis 4 History Crocs was is a footwear company founded in 2002 by three sailors. Seein the rand(scale potential in these shoes. the team decided to settle on the name Crocs due to the nature of the shoes attributes. the three men decided to call their friend. not only in terms of the consumer. these shoes would become a reat hit to all different #inds of consumers !ia rapid word of mouth. +mmediately. +n the meantime. a plethora of company salesman would tra!el to related !enues and small stores to inform the consumers about the !ariety of benefits associate with owin a pair of Crocs. but also in the minds of the retailers. the partners be an to a ressi!ely mar#et and sell these types of shoes to e!ery sailor they could et their hands on. -oo#in for a name that accurately con!eyed the products. these attempts were well recei!ed and demand for these Crocs footwear spi#ed. Once they achie!ed this oal. the Croslite formula. Snyder and his team decided to purchase 0oam 1esi ns. little did they #now at the time. the e2ecuti!e team focused on achie!in a lobal focus before the competition could emulate. The foam clo s offered a slip resistant bottom and were easy to clean. The three sailors put their minds to ether and reali*ed the reat potential of sellin such a shoe. 3nowin that the fun#y loo#in shoes would ha!e troubles sellin on their own. who later becomin the president. and remar#ably comfortable.s lifeblood. . Business Pro$ression /lmost immediately. odor resistant. Snyder and his team were loo#in for ways to ma#e Crocs stand out from other footwear companies. then CEO of the company. inspired by a pair of foam clo s one companion brou ht alon while !enturin the Caribbean. Ronald Snyder. characteristics.

5ith these all in place. Snyder decided to decentrali*e factories. how does Crocs continue to its differentiated from its competitors& +n addition. Crocs also has the threat of bein copied and dethroned. distinct competencies lie and how they can be le!era ed. . and for o their compoundin partner in +taly. Crocs has inte rated into newer mar#ets in order to attract a wide !ariety of customers all across the lobe. %owe!er. lea!in a reat deal of uncertainty of product turno!er for the stores and ultimately. and furs. many of them laced with common materials such as leather. +n addition. it has a ris# of bein attac#ed by other footwear companies. 5ith that said. bein able to create e2cess capacity and ship at a rapid pace if need be. +n addition to this. 1emand continued to increase for their footwear and consumers be an to become interested in Crocs new product lines. all to reduce costs and increase their control of inputs to outputs to satisfy demand at a faster pace. Crocs saw an opportunity here and catered their supply chain model around $uic# deli!eries and demand fle2ibilities. Case Issues /s pre!iously stated. Crocs continues to impro!e its business model to benefit all parties. as Crocs de!elops into new mar#ets to ain reach out to new se ment.Matonis 6 Snyder $uic#ly reali*ed that many companies in this industry stoc#ed their in!entory seasonally. it will be possible to see where Crocs. -ar er companies then be an to see the !alue in Crocs and basically came to them to stoc# their shel!es with these products. ma#in it difficult for retailers to stoc# the correct amount to satisfy demand. mo!e operation locations. how does Crocs protect itself from bein emulated or becomin a fad item& Throu h an +nternal and E2ternal /nalysis. cloth.

snea#ers. it is apparent that there aren.t any immediate threats of new entrants. we can see detect a few thin s about the footwear industry. competition in this industry is !ery hi h. 0irstly. the li#elihood of a new type of footwear comin out that neither of the companies thou ht of is $uite low.Matonis 9 External Analysis: Porter’s Five Forces P25TE5S *I'E *25CES: C52CS Throu h this analysis. 5hen analy*in the power of the buyers and suppliers. has a hi h control of its operations and thus cuts out the middlemen. Crocs seems to ha!e to focus on differentiatin themsel!es from their ri!als and by findin new ways of reachin out to consumers to steal away some of their buyin power. 1ec#ers Outdoor. To sum up the e2ternal analysis. . and Timberland all offer a !ariety of different products for all different types of consumers as well. "uyer power in this industry is hi h because consumers ha!e a lot of choices and often times want the best $uality product at the lowest possible cost. pre!entin the competition from stealin 8imitatin their competencies. 0ootwear companies such as 7i#e. %owe!er. Therefore. therefore. and sandals for all different occasions and mostly all of the companies offer a multitude of each of the followin . especially Crocs. This means that most of the competition Crocs faces are a ain other companies in the same industry. it is apparent that the supplier power is low since most companies. boots. Crocs is oin to ha!e to find a way to differentiate themsel!es from the masses of ri!als while at the same time. Substitutes for footwear could be said to be low because all we all wear shoes.

as we can see in the cases appendi2.ISTI9CITI'E C2MPETE9C:+ • Marketed as a shoe that is slip" resistant. the firm continues to e2perience rapid rowth each year. Mar=etin$ (. easy to wash. increase speed. n constant communication with stores and warehouses to ensure that products are always in stock and that the consumers that need to be serve are being accommodated. /s mentioned in the case. and to have outstanding customer responsiveness while upholding utmost quality.ISTI9CTI'E C2MPETE9C:+ • Materials from inputs to outputs are carefully managed through the supply chain and are optimized to lower costs.Matonis .ISTI9CTI'E C2MPETE9C:+ In ound 7o$istics: (. maintain a new flow of innovations. This ad!anta e shows that Crocs can $uic#ly account for supply and demand and thus has a stron competency in their production process. and e#tremely comfortable $hese shoes wouldn%t sell without a great sales person Aftermat• No information available • 0rom the :alue Chain analysis. . quick to make e#cess capacity to meet increasing demands. and optimize firm and consumer value. impervious to odors. and ways to reach out to a variety of new market segments Information Systems: • 5<. +n addition to that. Mar#etin seems to be a !ery stron suit from Crocs as well. ways to make new products. Crocs has a reat deal of control o!er their supply chain acti!ities and can produce products to e2cess capacity in a matter of moments with minimal la . Continuously looking for new market trends. Internal Analysis: Value Chain 'A78E C"AI9 A9A7:SIS: C52CS "uman 5esources: • • No Information Available Snyder and his team look over the operations very closely to look for new ways to increase efficiencies. 0irstly. the products would ha!e a hard time sellin themsel!es due to their obscure appearance and uncommon fit with the current footwear trends. %owe!er.ISTI9CTI'E C2MPETE9C:+ • !ll in"house. Continuously looking for ways to make the business more "lean" Infrastructure: (. decrease bottlenecks.: • Production: (. it is clear to see that Crocs has a !ariety of distincti!e competencies.

+n addition. their inbound lo istics. Internal/External Company Analysis: S !" S!1!2!T! A9A7:SIS: C52CS Stren$t-s • &ide 'ariety of different products and customizable options • (le#ible and constantly changing for reduce inefficiencies and optimize output and customer responsiveness • !mazing Supply Chain coordination and relationships with outlets • Considered plant locations to reduced e#traneous costs such as tariffs. shoes come off as goofy and radical 200ortunities • Can e#pand into new markets • Can promote their product more aggressively to obtain a new market • Can see what the customers want to see from crocs and do -ust that T-reats • *ivals products. which can be attributed to its push for !ertical inte rations. Throu h all of this. and their infrastructure with moderate to hi h le!els on e!erythin else. mar#etin . insi htful. which allows him to chan e the business model accordin ly.cofriendly • (ocusing too much on Croslite material as a competency • &ithout marketing. Crocs seems to be able to control all of its resources !ery well. • )lobal *each • !ble to handle periods of e#orbitant growth 1ea=nesses • +ot particularly . the Ronald Snyder as CEO i!es the firm a competiti!e ad!anta e which is hard to imitate. etc.Matonis e2periencin rowth rates hi her than any other in the industry. • Someone else coming in with a new innovation that makes the footwear we know of today as . Two other distincti!e competencies Crocs seems to hold is their control of materials throu h the supply chain <+nbound -o istics= and their corporate infrastructure. Crocs has apparent distincti!e competencies in production. e#cess transportation costs. The rate of this rapid success > can be hi hly attributed to their well refined mar#etin strate y. 0rom be innin to end product. and aware of the lobal conditions and immediate ri!als. Snyder is inno!ati!e.

two alternati!es seem to be apparent. is di!er in too much away from the shoes initial characteristics. causin a lac# of brand identity. and their hea!y focus on Croslite to differentiate their products. elbow pads. /nother alternati!e would be to diffuse and focus on mar#ets where Croslite materials can be used. emulated. Crocs purchased 0ury in October of . The pro to this strate y would be the ability to ser!e a !ariety of different consumers with a !ariety of products. 0irstly. and mar#etin . "y offerin shoes with furs. Crocs has to watch out for bein outshined. we can see that Crocs is a !ery solid company with a !ariety of distincti!e competencies. and life'ac#ets. The con. which would increase their influence and their re!enues. %owe!er. /lso. ma#in normal loo#in shoes. The pros to focusin oods would be that they could ma#e a new set of products such as #neepads. for oin Crocs products. cloths. howe!er. The con to this would be di!er in from the mar#et they #now best and spreadin their brand name too thin.Matonis "old"fashioned" or "obsolete" @ 0rom the S5OT analysis. %owe!er. consumers may become confused about the brand identity. their oofy ima e.09. which was a sportin on a different mar#et such as sportin oods store. or loo#ed o!er and could do this by e2pandin into new mar#ets usin an a ressi!e mar#etin strate y that is catered toward creatin optimum !alue for its buyers. Crocs could continue to create new styles and types of shoes for different consumers. Alternatives ?sin the pre!ious analysis as well as information from the case. specifically in their supply chain. if Crocs is . which mainly re!ol!e around the immediate threat of competitors. thus. and leather. production fle2ibility. the shoe is no lon er able to be odor(resistant or waterproof. /s mentioned in the case. Crocs seems to ha!e a few barriers ahead of them.

with proper in!esti ation. they mi ht 'ust be able to pull of doin both strate ies !ery well. if Crocs really too# the time to understand the needs of the consumers as well as the mar#et trends.Matonis careful about the way they e2pand themsel!es and learn #nowled e about all mar#ets and consumers. and if they continue to le!era e their stren ths and compensate for their wea#nesses. business. "y focusin on the mar#et at hand and by properly assessin the demands of the consumers. %owe!er. they could always create a new brand name for those products or somehow relate these new products bac# to the old.re products consumers are as#in for. huntin . Crocs could do a hybrid of the two pathways mentioned earlier. and beauty wear with little hesitation. pre!ail. The primary concern for Crocs in this situation would be e2pandin too $uic#ly into an unfamiliar mar#et. Ma#in new !arieties of products without a customer demand is wasteful and foolish. Crocs could also. while at the same time not driftin too far from their ori inal mission. +t is apparent that there is a bri ht future for Crocs. no doubt. . Crocs could e2pand its business model into a !ariety of consumer se ments such as construction. and then offer a $uality product at a reasonable price. Crocs could effecti!ely reach out and steal the mar#et on all fronts. Crocs would ha!e to ma#e sure to research their consumers. they will. e2pand e!en further into the sportin oods sector. find e2actly what they want. +n addition to differentiatin their footwear. +f Crocs feels as if their current ima e would tarnish sales in a more profession se ment. Crocs could continue to focus on offerin a wide !ariety of products but only if they. A0 #ecommen$ations +n response to their alternati!es.