Mr Le Essay
1) How well does active-wear fit with the Vigor division (e.g. target customer, advertising and sales strategy, production capabilities)? What possible impact could this new product line have on the Vigor brand name?
Harrington Collection's manufacturer and retailer of high-end women's apparel. The Vigor division of Harrington Collection's is aimed to appeal to younger fashion conscious customers. The division sells career wear, dreis a learge sses, skirts, blouses, pants and coats. The ideal customers targeted by the Vigor division are "trend setters", women aged 25-50 who are affluent, college-educated, and proffessionals seeking fashionable yet comfortable work clothing. The retail price ranges for …show more content…
The possible channel conflicts that may arise when introducing the active-wear line is that since the prices are generally lower for all products in the line, the current retailers may not wish to stock the cheaper products. The higher-end retailers that stock Vigor products may believe that the cheaper product line will have the effect of cheapening the store. These retailers may need convincing from Harringtons to sell the active-wear.
Also other retailers who had previously not stocked VIgor apparel may now desire to, due to the rapidly growing demand for the the clothing style and promising sales potential. This may conflict with the brand image of VIgor, and management would need to decide if there is enough distribution for the active-wear products already.
3) What is the financial impact of the proposed Vigor active-wear program for the manufacturing group? Using Exhibit 9 in the case as a guide, what are the start-up, ongoing fixed, and variable costs for this new product line? What unit sales target will