Kate Spade Case

Topics: Department store, Decision making Pages: 2 (643 words) Published: September 22, 2010
Critical Issue: Which options should Kate Spade take?

As the company has become bigger and its financial results were very strong, the team had begun to feel pressured to take the company next level. One of the team member felt that they were losing their control little by little since they had not ready for handling this issue yet. The team wanted to someone who was experienced and could manage developing team to next level. When Kate Spade was looking for some helps, Kate Spade was faced with offers from number of buyers, and what Kate Spade really needed was strategic help. In March 1998, the team had to think about four offers and decide which option the team should take for its company growth. Those four offers had important factors for Kate Spade to grown in the future. In order to make a decision there were three important factors which were really important to make their decision. Those were in Option A, B and C.

Option A: “No perfect person for CEO slot”
This investment bank offered company’s 40% of share on a post-money valuation $40millinon, and this company sounds great, and it had great ability to manage financial task. However, this company was not aggressive enough to grow Kate Spade in the future. Moreover, what Kate Spade really needed was the person who could help inside its company and take CEO slot. The person who was coming was not experienced enough in fashion industry or could not help Kate Spade to be a big brand.

Option B: “different positioning”
This company offered to buy 80% of Kate Spade in return for company stock. This company had a lot of department stores and specialty retail location in over 80 countries. If they made a contract, Kate Spade could use their useful resource. However, this company’s targeting market was not appropriate for Kate Spade. Their target price range was quite lower than Kate Spade was. Lowering the level of target was not the growing company should do and one of team member...
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • Essay about Kate Spade
  • Kate Cooper Case Essay
  • Case Essay
  • Case Essay
  • Case Essay
  • kate Essay
  • Sam Spade Essay
  • Essay about Kate

Become a StudyMode Member

Sign Up - It's Free