HOW HAS NEW BALANCES OPERATIONS STRATEGY SUPPORTED ITS COMPETITIVE OBJECTIVE
New Balance has made many key operating decisions that have set it apart from much of its competition. New Balance has always maintained that it is a company focused on manufacturing and operations rather than on marketing. This foundational principle guides the strategy around which the company is organized and run. This is a strategy that greatly differs from much of its competition, which focuses on very outwardly on publicity and celebrity to create reputation. One of the key differences between New Balance and its competitors is that New Balance has remained a private corporation. In doing so, New Balance has the ability to be a much more flexible and free-flowing company than its publicly traded counterparts. This freedom has allowed the company to use slightly unorthodox marketing, manufacturing, and sales techniques to attract a loyal customer base. Recently, New Balance has started to focus more on design and innovation in its product offerings in order to stay competitive in the marketplace.
HOW COSTLY WAS NEW BALANCES DECISION TO MAINTAIN 25% OF ITS MANUFACTURING IN THE US?
New Balance continues to manufacture 25% of its volume as final product assembly in one of five factories in the northeastern United States. Some of these domestically assembled shoes are “cut-through-assembly” product, meaning New Balance imports finished soles and the raw material for the uppers from Asian suppliers, allowing the company to finish manufacturing the uppers in the United States and then attaching the uppers to the soles. The other domestically assembled shoes are “sourced-upper” products, meaning New Balance imports finished uppers and soles from Asian suppliers and then finishes the assembly by attaching the uppers and soles in the United States. Although the company relies on foreign suppliers for the majority of its production, it still manufactures about a quarter of its...
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