Hanesbrands Swot Analysis

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Hanes SWOT Analysis
Strengths
Hanes shows a high level of incoming cash flow, with an annual operating profit of 6 to 8%. In addition to this the company has also decreased expenditures by reducing labor costs by consolidating the company’s manufacturing facilities, and phasing out excess costs, and diverting the resources elsewhere. The company also benefits from a very tight value chain due to the majority (79%) of its products being wholly produced within company owned facilities. Hanes also has a very extensive research and development team. This allows them to continually innovate and bring new products to the market, therefore addressing the changing market, industry trends, and appealing to customers.

Weaknesses
Hanes has a very unbalanced ratio of customer to sales. In 2007, 27% of the brands net sales were from Wal-Mart, while 62% of net sales were from only the top ten of the brands customers. If the brand lost any of these customers, it would severely impact the brands business, operations, and cash flow. Furthermore, since Hanes has only recently split off from its parent company Sara Lee, market analysis and evaluations may not be indicative of Hanesbrand Inc. This makes it harder to make executive marketing and operating decisions.

Opportunities
Hanes has the opportunity to expand its product line to international markets. It has already established strong customer relationship in the U.S., and can now expand into the growing Asian market. It can also push its products into the EU market in order to build some leverage on other global competitors in that area. It can further build on its strong foothold in the U.S. by branching away from its focus on T-shirts and underwear, and diversify and strengthen its other products such as sweaters and polos.

Threats
Hanes shows weak penetration in the global market, with only 10% of its sales coming from international customers. In addition to this, despite the company owning...
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