Abercrombie & Fitch Executive Summary

Topics: Brand, Branding, Brand management Pages: 3 (842 words) Published: March 5, 2012
Executive Summary: Abercrombie and Fitch
Industry: High-end casual luxury apparel
Industry Analysis- The Five Forces
• Threat of New Entrants include: established companies in related clothing markets could adjust merchandise to expand into A&F market. Level of difficulty to enter dependent on established infrastructure and brand recognition. Brand value and infrastructure are large barriers to entry for a new company. o Core group of loyal customers; however, as customers age, styles, tastes, and financial status change impacting loyalty. A&F markets to the 18-22 age group but they actually sell to the 20-30 age group. The Hollister brand actually captures the 18-22 age group. o Capital requirements comparatively low and include manufacture/storage of clothing and liquid assets for retail space and wages. o Products protected by license and trademark logo, yet counterfeit/illicit products available. Aggressive steps in place to prevent counterfeits. o Low challenge for entrants to acquire inputs; raw materials are traded commodities. Slightly more challenging to develop distribution centers. o Economies of scale will impact profits, but do not shape industry. • Competitive Rivalries include: American Eagle, GAP, Aeropostale, and J. Crew. Competitors use differentiation (not pricing) as strategy toward overlapping target customers. Competitors are larger (GAP) and Smaller (American Eagle, Aeropostale, J. Crew) than A&F. o Very low switching costs for customers.

o Exit costs for competitors are high; difficult to sell fixed assets. o Growth of industry varies with economy climate.
o Perceived product differentiation is high due to brand image. o Fixed costs vary given the business model of the firm. • Supplier Bargaining Power is low for commodities.
o Inputs include raw materials (cotton, dye, etc.), and employees, both of with are readily available...
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • Abercrombie and Fitch Executive Summary Essay
  • Abercrombie & Fitch Essay
  • Abercrombie and fitch Essay
  • Essay about Executive Summaries
  • Abercrombie and Fitch--Case 3 Essay
  • Abercrombie and Fitch
  • Abercrombie and Fitch
  • Abercrombie & Fitch Country Report Essay

Become a StudyMode Member

Sign Up - It's Free