Business Strategy

Porters 5 Forces for Lucky Brand

 

Threat	Strength of Threat	Example
Bargaining Power of Customer	Moderate	Customers have lots of option in the retail space to choose from, however the quality and price point of Lucky Brands products that are made in the US stand out.
Threat of substitutes	High	It would be easy for established clothing retailers to put out denim products that are similar to the items that Lucky Brand produces.
Barging Power of Suppliers	Moderate	Some items are made in house for Lucky Brand at a manufacturing shop based out of Los Angeles. Other items are made overseas and there exists some degree of risk of pricing fluctuations from these suppliers.
Threat of new entrants	High	The process and styles they used can be mimicked by new entrants.
Rivalry	Moderate	Other brands can make high quality jeans but it takes time to build a solid reputation.

 

 

Competitive Strategy:                                        

The Competitive strategy that Lucy Brand relies on is stressing the “made by hand” quality of their jeans and the unique American heritage behind the formation of the brand.  Lucky Brand was founded by friends Gene Montesano and Barry Perlman who met in the early 70’s and together would create washed jeans through a combination of bleach rinses and adding quarters to the wash cycle to age the denim.  Years after this early experience together the two joined together in 1990 to create Lucky Brand with the goal of producing high quality jeans with a special attention to detail.  Today the brand still places its focus on high quality apparel goods with their jean line being sewn by hand in Los Angles with the denim being sourced from a North Carolina producer.  The price point of their jeans and other goods are above average and are reflective of the material quality and craftsmanship that goes into production.  The overall competitive strategy held by “Lucky Brand” is higher than average quality goods that are proudly made in America.  

Business Process

The primary activities in Luck Brands Operations are manufacturing, sales and logistics for moving products between their online stores and distribution centers that handle online sales.  The brand utilizes inhouse production along with goods being outsourced from other producers outside the U.S. and when finished, these items are packaged and labeled.  From finished assembly, goods move to distribution centers that either send items directly to customers to fulfil online sales or the items move to one of the firms 250 retail stores.   Working to promote the stores and online functions are teams that market the brand and garner customer interest and drive sales.  Interconnecting all steps of these process are information systems that track goods in stores and in inventory and insure that customers can purchase any variety of high quality goods produced by Lucky Brand. 

Value Chain Components  

1. Inbound Logistics:    Ordering of premade goods and handling of raw materials for production.   

2. Manufacturing           Goods made inhouse at Lucky Brands manufacturing facilities.

3.  Outbound Logistics  Movement of goods from distribution centers to customers directly or to retail stores. 

4. Sales & Marketing     Attract business to retail locations and bring traffic to their online retail as well. 

5. Customer Service     Satisfy additional needs of customers post purchase and offer additional service and care to customers while they                                          make shopping decisions.