Ports 1961 Case Analysis

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I. Background

Ports 1961 is a subsidiary of parent company PORTS International. It was founded in Canada in 1961 by Luke Tanabe in what started as a thriving family business that lost its standing due to mismanagement by Tanabe’s successors. In 1989 the company was acquired by brothers Alfred Chan and Edward Tan. After a global economic recession hit the market, Alfred decided to close all American operations and moved the entire business to China in 1993. He focused on building the first luxury brand wholly made and distributed in Asia. Ten years later, success was evident when the company went public on the HKSE and was named one of the “Best under a Billion” businesses in Asia Pacific in 2006.

In 2003 Alfred was ready to make a comeback into the North American market and the IPO came in tandem with the launch of a more expensive label, Ports 1961, that targeted the more sophisticated global consumer of luxury items. A new world of opportunities was opening together with a distinct set of challenges. Ports 1961 would now compete with luxury heavyweights like LVMH and Hermes who had an aura of sophistication that derived from their European heritage. In addition, the family operated business would have to prove it could extend its success from China to the world while operating under the unique challenges of working with family, yet answering to stockholders.

II. Strengths & Opportunities

Insofar Alfred Chan has proved himself to be a resourceful entrepreneur who survived the downturn of PORTS in North America and turned it into an opportunity to reinvent the brand and start anew in an emerging market. He grew a large manufacturing and distribution operation in China and developed a competitive advantage hard for foreigners to replicate. He successfully established a stronghold on his domain in Asia and now has to use his expertise to find the next “China” to iterate the process.

Many luxury brands are...
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