External Analysis-Outdoor Sportswear Industry Essay examples

1344 Words Apr 16th, 2013 6 Pages
General Environment:
• Cultural o Cultural trends play a major role in the consumer appeal of this industry. We go through phases of what sports are trendy.
• Seasonal o There is a high seasonal influence on consumer buying. Summer products typically cost less than winter products. Sales during offseason offset sales revenue. Winter sales are higher during the holidays and prices of the products are higher.
• Physical o These companies are very aware of their carbon footprint. They are all based on the idea of being outdoors and care about how their production activities are affecting the environment.
• Legal o As with many companies, these companies need to be sure they are following policies that abide by labor standards, for
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Each company is exclusive to their individual suppliers, making them huge customers of these supplier groups. If any of these companies were to stop using their supplier, it would hurt the supplier significantly. The success of all the companies in this industry is based mainly on the consumer demand for these unique materials. o Substitutes do not really exist in this industry, unless a new supplier was to come up with new, innovative materials. o There are not many companies outside of this industry that need to use these suppliers. The companies of this industry are the dominant customers of the suppliers. o The supplies each of these companies need for their products are what set them apart in order to gain competitive advantage over each other. They cannot share suppliers for this reason, because their name brand is associated strictly with the suppliers of these materials. o The bargaining power of suppliers depends on suppliers’ economic bargaining power relative to firms competing in the industry. Suppliers are powerful when firm profitability is reduced by suppliers’ actions o Common resource suppliers have little to no leverage over firms.
• Barriers to Entry o Entry is difficult or when it is too costly and places potential entrants at a competitive disadvantage relative to firms already in the industry o High barriers due to capital needs, that the industry requires opening a lot of retail 5stores over the world.

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