Executive Summary Kana Avani identified the gap in the market for sustainable handbags without the sacrifice of style. Sustainability and the protection of our resources is priority, and doing it with style is a luxury Kana Avani provides. After careful market research and textile innovation, we have found a successful way to accomplish the perfect balance in our product assortment through eco-friendly fabric sourcing, fashionable practical designs, competent manufacturing, strategic marketing, and effective retailing. We will continue to provide a product that embraces technology and the ecosystem in order to successfully promote a sustainable and trendy lifestyle.
Company
Introduction: Kana Avani was founded on the sole purpose of putting the earth first Kana Avani wants to be a leader and recognized as a business that sets high standards not only in the product we produce, but how the product is produced. We take every measure of creating a sustainable product seriously. We live by our guarantee of putting the earth first not just for now but for our future.
Mission
To offer handbags which are sustainable, recyclable, and innovative without sacrificing creativity, aesthetics and visually pleasing products.
Vision
Our vision is to make the earth a better place by creating beautiful products that are safe for our environment.
VALUES Environment
We find science-enabled, sustainable solutions for our customers, always managing our businesses to protect the environment and preserve the earth’s natural resources both for today and for generations into the future.
Honesty
We are serious about honesty – both as it applies to the integrity of our relationships and in being true to you. And, it’s a standard we encourage throughout our employees, stakeholders, and customers. But, that’s just the beginning. In all we do, we want to make each day a little more fulfilling, inspired, and downright better.
Perseverance
Our goal is to help employees unlock their potential and together become the best company we can be. But it has to be a joint effort: you have to want to challenge and stretch yourself in order for it to happen.
Creativity
We are determined to nurture and grow our creative resources. Our success has been rooted in a blend of artistic creativity, which has always been and always will be, and our ability to attract the best creative talents, to empower them to create leading-edge designs that are less damaging to the environment is important to Kana Avani.
Target Market Overview
Kana Avani’s target customers are women who are conscious about the earth but at the same time do not want to sacrifice style. The demographics are broken down into two targets: 25-34: who is younger and trendy and more focused on style. 35-44: being focused on functionality and the life of the product.
Merchandise Categories
Calla $240
Oma $175
Sage $210
Willow $240
Ivy $190
Jade $150
Ginger $150
Tala $250
Market Size
According to Euromonitor International November 2013 Bags and Luggage In The US market research report, the specific industry produces $20billion of revenue annually.
2012
% Growth
2013
Bags
17,013.10
4.3
17,742.50
Backpacks
1,669.40
8.3
1,807.20
Business Bags
943.4
-0.2
941.1
Crossbody Bags
3,317
5.6
3,504.20
Duffel Bags
1,941.40
-1
1,921.10
Handbags
7,052.50
4.9
7,396.10
Wallet and Coin Pouches
1,548.20
3
1,595
Other Small Bags
541.3
6.7
577.8
Luggage
2,113.60
12.2
2,370.70
Bags and Luggage
19,126.80
5.2
20,113.20
Euromonitor International 2013
Current Trends Bag companies advertise the features that are specially created to house electronics. Design features that accommodate and protect these expensive electronics. These extra components might raise the unit price of a bag or luggage, but consumers are willing to pay extra rather than replace electronics. Consumer spending habits changed significantly due to the recession and purchasing frequency decreased. When exiting the recession consumers started replacing what they had previously chosen to keep, and now they search for higher quality that will last longer. Handbags will continue to see steady growth, thus adding value to the category as a whole. Handbags trends are being led by shoulder and tote bags, as well as top handle bags. Top handle bags in particular are receiving a great deal of attention, as many of them are sold with an optional crossbody and shoulder function. The addition of these crossover features to handbags will be the reason that crossbody bags will lose share. Shoulder bags and tote bags are the dominant forces within handbags, with sales of $5.2 billion. Totes offer the consumers space, comfort and portability ingrained into the form of the bag itself. They are expected to maintain their popularity since more fashion labels are offering them in various styles to better fit their customers. Internet retailing has remained as one of the fastest growing distribution channels for bags and luggage; physical stores have noticed the difference in customer presence. Many consumers are now engaging in showrooming, that is the action of entering the store to research a product they are considering to buy, but once a decision is made they make the purchase online to assure the best price.
Euromonitor International. “Bags and Luggage in the US.� Bags and Luggage in the US. November 1, 2013. Accessed November 3, 2014.
Competitive Analysis
Price Range $258-$598
Net Sales $740 million
Kate Spade endeavors to care and safeguard the environment through efforts of environmental and social responsibility. The company conducted a Carbon Footprint analysis with the assistance of Clean Agency. The analysis covered operations in the United States (including offices, distribution centers and stores), and also goods transported from manufacturers (domestic and abroad) and distribution centers and stores in the US. The intent was to use the findings to inform and evolve the company. However the actual handbags are not highly sustainable. Materials used in the product include resin, plated hardware, polyester, metallic foil, and vinyl which are not sustainable, recyclable materials. Kate Spade’s handbags are highly stylish. Bags with bows, glitter, feathers and beautiful leathers make up their collections. Kate Spade is distributed in 200 shops in over 20 countries, and distributed in over 450 premiere department stores around the world. Kate Spade is also distributed online.
“Kate Spade & Company - Our Company.� Kate Spade & Company - Our Company. Web. 22 Oct. 2014.
Price Range $44-$440
Fleabags position themselves as a green company that maintains high quality products and design. The bags are made of organic materials, vegetable tanned and re-purposed leathers, and water-based ink, all sourced in the US. “Our products are made to last a lifetime. Since we strive to produce environmentally sustainable products, we do not treat our materials with water-resistant or protective chemicals. However, below are a few tips to clean and maintain your bag”. "About Us. " Fleabags are distributed in 74 stores in the US and 4 other countries. Fleabag also distributes online and manufactures its handmade products locally, supporting small businesses.
“About Us.” Flea Bags. Web. 22 Oct. 2014.
Price Range $189-$359
Crystalyn kae are eco-friendly vegan handbags made out of seaweed and corn derivative fabrics, wool-free tweed, glazed fabric and non-leather micro suede. Crystalyn kae’s entire brand is not vegan reclaimed leather is also used. Styles for the vegan collection are very limited and more of a hobo style inspiration. Crytalyn kae is distributed in 40 boutiques across the US and online.
Jo, Chole. “An Interview with EcoBag Designer to the VeganStars: Crystalyn Kae.” Girlie Girl Army. 13 Sept. 2008. Web. 22 Oct. 2014.
Price Range $300-$1200
Coach continues to evaluate new manufacturing sources and geographies to deliver the finest quality products at the lowest cost and help limit the impact of manufacturing in inflationary markets. Therefore their interest is in cost impact and not focused in environmental impact. Coaches position themselves as a global strategy brand. They reported $2,642,000 in sales for women handbags in the period ending in Aug 2014, 55% of total sales. Coach’s distribution strategy is multi-channel. As of 2014, there are over 500 Coach stores in North America, approximately 450 directly operated locations in Asia, and over 25 in Europe. Coach also offers an e-commerce website in United States, Canada, Japan, and China as well as informational websites in 20 other countries. Coach has also made strong relationships with department stores by placing their boutiques in selected retailers; this has also expanded their global presence. Coach manufacturers are located in many countries, including Vietnam, China, the Philippines, India, Thailand, Italy, Hong Kong and the United States. Coach continues to evaluate new manufacturing sources and geographies to deliver the finest quality products at the lowest cost and help limit the impact of manufacturing in inflationary markets. No other individual vendor currently provides more than approximately 10% of Coach’s total units. Before partnering with a vendor, Coach evaluates each facility by conducting a quality and business practice standards audit. Periodic evaluations of existing, previously approved facilities are conducted on a random basis to ensure manufacturing partners are in material compliance with Coach’s integrity standards. They made their first sustainability report as of 2013, making public the considerable work they have completed in the area.
“COMPANY INFORMATION.” FINANCIAL REPORTS. August 1, 2014. Accessed November 10, 2014.
Price Range $200-$1,000
The business is operated in three segments; retail, wholesale and licensing. Together they made $3,310,843 in the last fiscal year. As of March 29, 2014, the retail segment included: 288 North American retail stores, including concessions; and 117 international retail stores, including concessions, in Europe and Japan. Cities include New York, Beverly Hills, Chicago, London, Milan, Paris, Munich, Istanbul, Dubai, Seoul, Tokyo, Hong Kong, Shanghai and Rio de Janeiro. Michael Kors recently united with the United Nations World Food Program in honor of World Food Day on October 16th, 2014. The logo was Kors Cares, and the idea was to help raise money and awareness. They also launched some limited-edition products to help promote the campaign. No environmental projects are exhibited in their website or make part of their annual plan. Michael Kors Code of Conduct is straight to the point and generalized for application to many vendors and licensees. This makes the regulations less effective (Appendix C). The company also has an audit program under a third party in which they are selected for audits each year based on risk assessment. Planned auditing is flaw because the circumstance is not natural and conditions can be hidden or faked.
“2014 Fiscal Year Annual Report.� Michael Kors. January 1, 2014. Accessed November 11, 2014.
Price Range $120-$150
Matt & Nat stands for Mat(erial)+Nature, it is a vegan brand therefore there is no animal products used in production. They develop prototypes and collections using their signatures vegan leathers and eco-friendly materials like recycled nylon, cardboard, cork and rubber. Some of the vegan leathers used in their production are Polyurethane and PVC; PU has less impact to the environment so they prioritize to use it when possible. Since 2007 they have been committed to using linings only made out of 100% recycled plastic bottles. Another innovation is the introduction of recycled bicycle tire to their collection. The bags are then produced in China, in small factories where they have had long-standing relationships. They only collaborate with factories that are in line with their ethics and verify regularly through diligent visits that their operations are up to standards and to better improve their relationships. One of their factories operates under the SA8000 standard and they want to integrate it to the rest of their production in the future. Matt & Nat collections can now be found in boutiques across Canada, the US, the UK, Japan, Germany and Australia .
“Ethics & Sustainability - Matt & Nat.� Matt Nat. January 1, 2014. Accessed November 11, 2014.
Price Range $79-$800
Ellington handbags are muted in color with simple, yet nice styles. Ellington relies on signature leather materials and tanning techniques for their handbags. “Ellington ECO Leather is made in an award-winning environmentally responsible tannery that uses efficient processes to reduce water consumption, energy use and CO2 emissions”. Ellington Handbags Ellington takes a sustainable approach to tanning their leather. Vegetable tanning uses natural ingredients found in different vegetable matter and is a natural process. Distribution for Ellington can only be found through online retailers including their own site, and Amazon .
“Signature Leathers & Fabric’s.” Ellington Handbags. Web. 28 Oct. 2014. <http://www.ellingtonhandbags.com/Signature-Materials>.
Price Range $70-$175
Vegan Chic is a company that is 100% vegan and focus on the aspect of compassion in their products and workplace. “Vegan Chic products have been vetted to ensure they meet our high standards of cruelty-free sourcing to fair and safe working conditions during production. We search diligently for eco-friendly and cruelty-free products because it’s the right thing to do”. Vegan Chic offers a wide variety of handbags, shoes, and accessories and have price to fit every budget from low to high. Vegan Chic products are only distributed on their website .
Vegan Chic: About Us.” Vegan Chic: About Us. Web. 29 Oct. 2014.
Price Range $75-$500
Walleska Ecochic primary focus is their customers and the planet. Recycled materials and natural resources are handcrafted for handbags, accessories and apparel. Materials are sourced from garbage, recycling centers and natural ingredients found in the earth. Handbags are made from recycled intertubes, bottle caps, and pull tabs and natural threads. The company is highly sustainable, nonetheless designs are complex and there are 15 styles in their collection. Walleska Ecochic can only be found through online retailers .
“Ecochicc — About Us (handbags, Purses, Accessories, Jewelry from Recycled Aluminum Pop Top Pull Tabs).” Web. 29 Oct. 2014.
Positioning in the Market
Forecast Sales
% Value Growth 2013-2018 (% constant value growth)
2013-18
2013-1018
Bags
CAGR 13.5
TOTAL 18.9
Backpacks
4.8
26.6
Business Bags
1.2
6.1
Crossbody Bags
2.3
11.9
Duffel Bags
3.1
16.2
Handbags
4.4
24.3
Wallet and Coin Pouches
2.1
10.9
Other Small Bags
3.9
20.8
Luggage
6.8
38.9
Bags and Luggage
3.9
21.3
Euromonitor International 2013
TARGET COSTUMER Demographic Segmentation
25-34
Accounting for 20,756,000 of the population according to the United States Census Bureau data of 2012 . A survey conducted by Generate Insight states that 64% of millennials between ages 25-34 are willing to pay more for a product if they know they are investing in an environmental cause . Our target market reports an estimate of $1.68 trillion in purchase power claimed by Forbes in April 2014 . The median income for females under our target market is $35K-$70K a year, and they live in urban cities .
35-44
This group makes up 12.8% of the United States population. This demographic includes: single moms, married moms, married women (no kids) and single women. Their workforce consist of occupations of: Community Service Coordinator, Personal Financial Adviser, Environmental Scientist, Registered Nurse, Computer Systems Manager, Education Administrator, Accountant, Human Resources Specialist, Small Scale Niche Framer. Salaries for these occupations range between $28,000-$166,000.
“2010 Census Data.” - 2010 Census. Accessed November 7, 2014. Gaudelli, Janis. “The Truth Behind Millennials and the Green Movement | GoodWorks - Advertising Age.” Advertising Age GoodWorks RSS. April 1, 2009. Accessed November 7, 2014. Spenner, Patrick. “Inside the Millennial Mind: The Do’s & Don’ts of Marketing to This Powerful Generation.” Forbes. April 16, 2014. Accessed November 11, 2014. “The Millennial Generation Research Review.” U.S. Chamber of Commerce Foundation. Accessed November 7, 2014.”
Psychographic Segmentation 25-34
Individuals in this target market strongly believe in eco-friendly lifestyles and this has integrated into their wardrobe choices. Our sustainable handbags are marketed to the millennial generation that stands out by their environmental awareness. Millennials are willing to contribute to eco-friendly projects if they are accessible, our handbags will provide the efficiency and style of the product plus the facilitation to cooperate with the ecosystem. The females in our customer profile are fashion conscious and are prepared to invest in durable accessories, being a strong spending power in the fashion industry . Millenials are also busy young adults that will appreciate the innovation of nanotechnology to keep their handbags clean and protected from exposure and use throughout the years.
35-44
Psychographics for this segment include personality, lifestyles, and hobbies. Families matter most and they take their parenting role very seriously. Most live an active lifestyle and are always looking for healthy lifestyle choices for themselves and their families including both food and physical activity. They involve themselves in activates such as: attending their children’s sporting events, recitals, clubs and helping with academic needs. Careers are also important to this group and hold positions that they have worked hard on moving up the social ladder. Lifestyle choices for this group include: Vacation at the beach and national parks, order online, read fashion and lifestyle magazines, drive SUV’s, and watch television shows such as Grey’s Anatomy.
“Millennials Buy More Clothing Than Previous Generations, and Other Shopping Habits.” Market Truth. March 14, 2013. Accessed November 10, 2014.
Shopping Habits 3 out of 4 millennial’s researches online before buying a product, prioritizing something durable with good reviews and that eases environmental consciousness. 47% of our target market shops apparel more than 2 times a month, and buys 1/3 more apparel per year than non-millennials regardless of income or race . 1 in 25 women say they own more than fifty handbags, surveys also reveals 17% of these women spend an estimate of $700 on a bag. Women between 30-40’s tend to focus on the life and functionality of a product. These women are more careful about much they spend and represent the demographic for buying premium brands. They browse the Internet for information on the product before they buy, they check the product in person at the shops and then buy online for better deals. This group has upscale taste, however they seek deals on high quality merchandise. “She holds tremendous spending power (on average $75K yearly). She buys for the entire family, is increasingly doing her shopping online, and she is on the Web all the time (studies show the average mommy blogger/networker logs into her Facebook account more than 10 times daily).
Suddath, Claire. “The Millennial Way of Shopping: More Careful, Durable, and Frugal Than You Think.” Bloomberg Business Week. April 25, 2014. Accessed November 10, 2014. Aho, Lee. “An Inside Look at Marketing to Women Ages 35-55.” Click Booth. 3 Mar. 2010. Web. 20 Oct. 2014
Life Cycle Life cycle of women’s handbags, who buy amongst the ages of 25-45, lasts approximately 3 years depending on their aesthetic and usefulness. If a big investment is required then there is more sentimental value as well as a higher product quality, as a result the bag may last more than six years. Expensive items tend to be more timeless and durable because customer’s go through research and select the item they believe will bring more usage linked to cost. Nonetheless, if materials are of minor quality and handbag was a low price, they can last the small timeframe of a year. ¾ women buy one handbag per year to replace a desired style they once had in their closet or simply to upgrade. It is not so much how long a bag can last but what the consumer expects when buying it, this reflects the price they are willing to pay, the treatment, and maintenance they will provide for the bag.
Faw, Larrisa. “Meet The Millennial 1%: Young, Rich, And Redefining Luxury.” Forbes. October 2, 2012. Accessed November 10, 2014. “PurseForum.” How Long Do You Expect Your Bags to Last? -. Accessed November 10,
Product Assortment
Calla Calla
Body: Brentano eco-friendly
Size:
faux leather. Varsity
10”x15”x3”
Collection. Color: Bear
Details: Brentano eco-friendly faux leather. Varsity Collection. Color: Hawk
Price: $240
Style
Calla
Size
10"15"x3"
Material Brentano Eco-Friendly faux leather
$/yard
Yield
Total
$48.00
0.4
$19.20
Nato-Tex+BioAm
$6.00
0.4
$2.40
Organic Cotton Plus Hemp Thread
$0.16
4
$0.64 $22.24
Labor
Total
Pattermaking
$0.40
Cutting
$0.40
Sewing
$50.00 $50.80
Packaging
Total
Dust Bag
$0.50
HandTag
$0.01
Brochure
$0.03 $0.54
Shipping Cost Mark-up% Wholesale Mark-up % Retail Â
$0.34 $73.92 30% $96.10 149.74% $240.00
Oma Oma
Body: Brentano eco-friendly faux
Size:
leather. Varsity Collection.
8”x12”x2”
Color: Panther
Details: Brentano eco-friendly faux leather. Varsity Collection. Color: Bulldog
Price: $175
Style
Oma
Size
8"12"x2"
Material Brentano Eco-Friendly faux leather
$/yard
Yield
Total
$48.00
0.25
$12.00
Nato-Tex+BioAm
$6.00
0.25
$1.50
Organic Cotton Plus Hemp Thread
$0.16
2.5
$0.40 $13.90
Labor
Total
Pattermaking
$0.40
Cutting
$0.40
Sewing
$50.00 $50.80
Packaging
Total
Dust Bag
$0.50
HandTag
$0.01
Brochure
$0.03 $0.54
Shipping Cost Mark-up % Wholesale Mark-up % Retail
$0.34 $65.58 30% $85.25 105.28% $175.00
Â
Ivy Ivy
Body: Brentano eco-friendly
Size:
faux leather. Varsity
12”x10”x1.5”
Collection. Color: Comet
Details: Brentano eco-friendly faux leather. Varsity Collection. Color: Bear and Panther
Price: $190
Style
Ivy
Size
12"x10"x1.5"
Material Brentano Eco-Friendly faux leather
$/yard
Yield
Total
$48.00
0.3
$14.40
Nato-Tex+BioAm
$6.00
0.3
$1.80
Organic Cotton Plus Hemp Thread
$0.16
5
$0.80 $17.00
Labor
Total
Pattermaking
$0.40
Cutting
$0.40
Sewing
$50.00 $50.80
Packaging
Total
Dust Bag
$0.50
HandTag
$0.01
Brochure
$0.03 $0.54
Shipping
Cost Mark-up % Wholesale Mark-up % Retail Â
$0.34
$68.68 30% $89.28 112.80% $190.00
Ginger Ginger
Body: Brentano eco-friendly
Size:
faux leather. Varsity
9”x6.5”x3”
Collection. Color: Bear
Flap and Strap: Brentano eco-friendly faux leather. Varsity Collection. Color: Hawk
Price: $150
Style
Ginger
Size
9"x6.5"x3"
Material Brentano Eco-Friendly faux leather
$/yard
Yield
Total
$48.00
0.25
$12.00
Nato-Tex+BioAm
$6.00
0.25
$1.50
Organic Cotton Plus Hemp Thread
$0.16
3
$0.48 $13.98
Labor
Total
Pattermaking
$0.40
Cutting
$0.40
Sewing
$50.00
Packaging
Total
Dust Bag
$0.50
HandTag
$0.01
Brochure
$0.03 $0.54
Shipping
Cost Mark-up%
$64.86 30%
Wholesale
$84.83
Mark-up %
77.9%
Retail Â
$0.34
$150
Sage Sage
Body: Brentano eco-friendly
Size:
faux leather. Varsity
11”+5”x16”x3
Collection.
”
Color: Comet
Details: Brentano eco-friendly faux leather. Varsity Collection. Color: Bulldog
Price: $210
Style
Sage
Size
11”+5”x16”x3”
Material Brentano Eco-Friendly faux leather
$/yard
Yield
Total
$48.00
0.4
$19.20
Nato-Tex+BioAm
$6.00
0.4
$2.40
Organic Cotton Plus Hemp Thread
$0.16
4
$0.64 $22.24
Labor
Total
Pattermaking
$0.40
Cutting
$0.40
Sewing
$50.00 $50.80
Packaging
Total
Dust Bag
$0.50
HandTag
$0.01
Brochure
$0.03 $0.54
Shipping
Cost Mark-up % Wholesale Mark-up % Retail
$0.34
$73.92 30.00% $96.10 $118.92 $210
Willow Willow
Body: Brentano eco-friendly
Size:
faux leather. Varsity
18”x10”x1.5”
Collection. Color: Dragon
Details: Brentano eco-friendly faux leather. Varsity Collection. Color: Bulldog
Price: $240
Style
Willow
Size
18”x10”x1.5”
Material Brentano Eco-Friendly faux leather
$/yard
Yield
Total
$48.00
0.45
$21.60
Nato-Tex+BioAm
$6.00
0.45
$2.70
Organic Cotton Plus Hemp Thread
$0.16
1.5
$0.24 $24.54
Labor
Total
Pattermaking
$0.40
Cutting
$0.40
Sewing
$50.00 $50.80
Packaging
Total
Dust Bag
$0.50
HandTag
$0.01
Brochure
$0.03 $0.54
Shipping
Cost Mark-up % Wholesale Mark-up % Retail
$0.34
$76.22 30.00% $99.09 142.2 $240.00
Jade Jade
Body: Brentano eco-friendly faux
Size:
leather. Varsity Collection.
9”x9”x2”
Color: Panther
Details: Brentano eco-friendly faux leather. Varsity Collection. Color: Bear and Dragon
Price: $150
Style
Jade
Size
9”x9”x2”
Material Brentano Eco-Friendly faux leather
$/yard
Yield
Total
$48.00
0.2
$9.60
Nato-Tex+BioAm
$6.00
0.2
$1.20
Organic Cotton Plus Hemp Thread
$0.16
3
$0.48 $11.28
Labor
Total
Pattermaking
$0.40
Cutting
$0.40
Sewing
$50.00 $50.80
Packaging
Total
Dust Bag
$0.50
HandTag
$0.01
Brochure
$0.03 $0.54
Shipping Cost Mark-up % Wholesale
$0.34 $62.96 30% $81.85
Mark-up %
83.26%
Retail
$150.00
Tala Tala
Body: Brentano eco-friendly
Size:
faux leather. Varsity
13”x14.5”x3”
Collection. Color: Bulldog
Flap: Brentano eco-friendly faux leather. Varsity Collection. Color: Comet
Price: $250
Style
Tala
Size
13”x14.5”x3”
Material Brentano Eco-Friendly faux leather
$/yard
Yield
Total
$48.00
0.6
$28.80
Nato-Tex+BioAm
$6.00
0.6
$3.60
Organic Cotton Plus Hemp Thread
$0.16
3
$0.48 $32.88
Labor
Total
Pattermaking
$0.40
Cutting
$0.40
Sewing
$50.00 $50.80
Packaging
Total
Dust Bag
$0.50
HandTag
$0.01
Brochure
$0.03 $0.54
Shipping Cost Mark-up % Wholesale Mark-up % Retail
$0.34 $84.56 30% $109.93 127.40% $250.00
Sourcing and Impact Measurement Varsity-3901
100% Polyurethane Face; 63% Polyurethane, 37% Recycled Polyester We are using Varsity-3901 as a leather alternative for our handbags because of its sustainability and recycled components yet stylish appearance. Our polyurethane is degradable. Naturally soft and flexible, our fabric does not require plasticizers used to soften PVC or the chromium used in leather tanning. Our materials come from Brentano, a company that focuses on producing environmentally friendly textiles (Appendix F). The varsity is manufactured in facilities that are conscientious of the environment and comply with local environmental ordinances. The facility is ISO 14001 certified, which creates an Environmental Management System to identify and achieve environmental goals. All pigments and chemicals used in the facility comply with EPA guidelines. Varsity is part of the Ultra Friendly Series of polyurethane faux leather category in Brentano. They are made with a patented “dry” process unlike other companies that use the traditional “wet” method. Our approach consumes only 0.1% of solvent, it requires barely 1/3 of the energy to produce, and in addition to the ecological benefits the fabric is tested to be strong in abrasion and exhibits superior hydrolysis performance. Our company wants to position itself environmentally higher than companies like Kate Spade that uses PVC in large amounts which contains chloride and is not recyclable. It leaches toxic additives in landfills and emits carcinogenic dioxin when incinerated. They also use resin, plated hardware, polyester, and metallic foil.
Nano-Tex P lus Bio-Am technology The Nano-Tex Plus Bio-Am technology permanent finish we are applying our handbags is biodegradable and does not contain any arsenic, tin, heavy metals or polychlorinated. Other than Nano-Tex plus Bio-Am being environmentally friendly, since it protects the handbags from odors and stains caused by microbes there is no need for harmful cleaning supplies, aerosol and harsh chemicals. This also prolongs the lifecycle of the handbag, encouraging customers to use the most of their product to be monetarily efficient.
“Home.” ISO 14001:2004. Accessed November 10, 2014. Environmental Protection Agency: Federal Register. Vol. 2. S.l.: Not Avail, 2013. 62.
Manufacturing Our manufacturing is done in New York under Baikal Handbags Manufacturer. The convenient location of our manufacturer close to our headquarters allows us to have control over product quality, time productivity, facility guidelines, and working conditions. This also significantly lowers our shipping costs since we are only shipping the product from the manufacturer to Macy’s distribution center as seen in cost sheet. The rest of the bags, that we will sell directly online do not require third party shipping from the manufacturer to our headquarters due to proximity . Baikal works under the New York State Department of Labor Apparel Industry Task Force protocol. These regulations ensure our workers best interest and rights will not be taken lightly and their working conditions will be strictly measured and enforced by a system already in place. This will avoid the weight on our shoulders most of the large handbag brands experience when they source abroad, they face issues that can impact their customer-brand relationship and brand corporate culture. Companies like Michael Kors and Coach have to pay a third party to conduct audits in their several manufacturing locations, this affects them financially and their code of conduct is not always enforced in developing countries.
“Made in US Production” Baikal. http://www.baikalhandbags.com/aboutus.php (accessed November 8, 2014).
Customer Engagement Retailing Kana Avani is a privately owned company based in New York City, New York. We sell our assortment of eight bags on wholesale to 12 Macy’s retailer stores, throughout major cities in the US (presented in chart). The cities we selected to sell in are considered strong selling locations in the country because of their tourism, population and demographics in shopping habits. Macy’s was chosen because our target market shops at their 840 iconic retailing stores, their brand equity aids in the exposure of our new to the market product. Their omni-channel integration enhances engagement with customers in stores, online and via mobile devices; this strong relationship with customers is something we want our brand to reflect. Earlier during the year Macy’s stated that throughout the next three years it plans to capture more money from the millennial customer. “This is phase one. We’re serious about this and we’re aggressively going after this consumer [millennial]. This is not a test”. Macy’s ethical stance aligns with our brand vision, “At Macy’s, Inc. we pride ourselves on being part of a company that operates with integrity, makes good choices and does the right thing in every aspect of our business”. Macy’s social responsibility calls for the company to be held accountable for how they impact the world, not only socially, but environmentally as well. They show progress through their 5-Point Action Plan and their commitment to the people and communities where they do business is specified in Macy’s Inc. 2013 Report on Social Responsibility (Appendix #E). Macy’s prices compared to aesthetic also mirror ours companies product to price ratio. Our company calculated Macy’s 2.2 markup in order to efficiently calculate wholesale price to have similar retailing prices. Our $150-$250 price variety fits our retailers mid-range prices. Kana Avani will also retail its products through its online page kanaavani.com, where all its products may be found as well as our brands promotions. The total assortment for our launch to the market will be 5,000 handbags, from which 40% (2,000) will be used for online retailing and the remaining 60% (3,000) will be distributed to the Macy’s stores in the indicated cities. The handbags production is divided between models, the styles we expect will have a higher demand will have more units produced than the least popular items. We determined this differentiation through our trend reports.
Casserly, Meghan. “The Best Shopping Cities In The U.S.” Forbes. January 1, 2010. Accessed November 11, 2014. Palmieri, Jean. “Macy’s Initiative Targets Millennials.” WWD. October 18, 2012. Accessed November 7, 2014. Molly Langenstein, Executive Vice President and Group Merchandise Manager for Millennial Terry J. Lundgren. Chairman, President and Chief Executive Officer, Macy’s
Online Assortment P lan
Handbags 1. Oma 2. Tala 3. Sage 4. Jade 5. Ginger 6. Calla 7. Ivy 8. Willow Total
Production Percent
Amount of Bags
45%
900
25%
500
30% 100%
600 2,000
Individual Amount 300 300 300 250 250 200 200 200 2,000
Wholesale Assortment P lan
Handbags 1. Oma 2. Tala 3. Sage 4. Jade 5. Ginger 6. Calla 7. Ivy 8. Willow Total
Production %
Amount of Bags
45%
1,350
25%
750
30% 100%
900 3,000
Individual Amount 450 450 450 375 375 300 300 300 3,000
Macy’s Assortment Distribution
Boston Las Vegas Los Angeles New Port Beach Palm Beach San Francisco Chicago New york Houston Miami Total:
Oma 45 45 45 45 45 45 45 45 45 45 450
Tala 45 45 45
Sage 45 45 45
Jade 37 37 37
Ginger 37 37 37
Calla 30 30 30
Ivy 30 30 30
Willow 30 30 30
45 45 45 45 45 45 45 450
45 45 45 45 45 45 45 450
37 37 38 38 38 38 38 375
37 37 38 38 38 38 38 375
30 30 30 30 30 30 30 300
30 30 30 30 30 30 30 300
30 30 30 30 30 30 30 300
F UNC T ION
Our assortment of 8 products covers the broad spectrum of needs and preferences of the everyday woman. We attend the market demand and trend, of carrying electronics in compartments conveniently designed inside the handbag. All of our bags have sleeves to house the average smart phone and specific styles are meant to carry larger electronics like laptops and tablets. The various models include handbags for casual outings, work, and formal wear.
Calla
Is a top handle bag with a shoulder strap that can be concealed to customer preference. The bag has an assigned side envelope perfect for 13â&#x20AC;? laptops and any size tablet.
Oma
Is a crossbody bag useful for everyday outings, it easily adapts to different occasions from day to night wardrobes. It includes an inside pocket for an Ipad.
Ivy
Is a top handle bag that can double as an envelope or clutch. Its multiple conversions make it a must have for when customers only need to carry essentials in their purse.
Ginger
This bag is a compact crossbody that is ideal for errands, casual daytrips, and can also be dressed up for evenings out. Its versatility makes it a demand.
Sage This tote is definitely a trend essential. Its spacious form can fit up to a 15” laptop in its inside folder, not to mention smaller electronics. Its durability and style make it very useful for traveling, work, school, and long days when resourcefulness is key. Sage’s usefulness is vital in any women’s closet.
Willow
This bag is a combination of fashion accessories in one. It can be used as a top handle handbag, and if folded down the middle it can also be a crossbody or envelop purse. The outer pocket hides the strap when and if the customer is not using it. Willow can fit a 15” computer when in full size and smaller electronics.
Jade
This tricolored over-the-shoulder handbag has pockets on the inside for small electronics and accessories you want to keep organized.
Tala
This is our brands workbag. It has a separate compartment inside for a laptop up to 15” big or any tablet. It is also very convenient for keeping documents and folders.
Care Instructions
All of our products will be lined with the nanotechnology, Nano-Tex plus Bio-Am, which is a permanent finish that protects the fabric against microbes and bacteria. This significantly reduces odors and stains and is environmentally friendly, increasing the duration of the bag. Kana Avani bags do not need water or chemicals to be cleaned and can sustain long exposure and continuous use. The finish will not change the aspect of the fabric, but it will positively impact our products lifecycle and merit the investment.
Disposal
Our environmentally conscious customer will be incentivized to participate in the “Wear. Donate. Recycle” campaign from the Council of Textile Recycling, a non-profit organization. In average the U.S generates 25 billion pounds of textiles per year and only 15% gets recycled and 85% goes to landfills (Appendix A). The brochure that is included with the purchase of any bag will explain the textile recycling process, as well as the importance to raise awareness and the recycling percentage for an alternative to our landfills. Since Kana Avani’s handbags are made out of Polyurethane and are 100% faux leather, the material is considered a textile. When the customer determines the handbag has reached the end of its lifecycle, the next step would be to recycle it at a municipal recycling center. Or if it is more convenient for the customer, Kana Avani can receive the handbags and take care of the disposal process. Customers can go to our online website kanaavani.com and request a free shipping label to our headquarters where we will continue the recycling process. The council of Textile Recycling website provides a search tool that can help the customer find their nearest recycling location, by narrowing down state, city and zip code. Textile recyclers sort and separate materials that will be transformed into 3 classifications: 45% are reused and repurposed, which are exported for secondary uses. 30% is recycled and converted into wiping rags and absorbents for cleaning. 20% is recycled into fiber to make home insulation, carpet padding and raw material for the automotive industry. 5% will always go to waste after the recycling process (Appendix B). To date the post consumer waste in textiles represents 5.2% of all municipal solid waste. Therefore, The Council of Textile Recycling has set a goal to reach the post consumer textile waste percentage to zero by 2037. Meaning that all textile waste will be recycled and the percentages that go to waste will drop from 85% to 5%. The handbags will be processed into highly effective industries within 30 and 60 days.
"FABRICS FAQ : Nano-tex Textile." Fabrics FAQ : Nano-tex Finishes for Healthcare Textile. Accessed November 7, 2014. “ABOUT CTR.” Council for Textile Recycling. January 1, 2014. Accessed November 10, 2014.
Garment Lifecycle
30% 45%
20%
Branding
Hangtag
Uprinting 2â&#x20AC;? x 3.5â&#x20AC;? White, 14 pt. Cardstock Matte, Front and Back Printed Sides Qty: 5,000 $84.42 Cost Per Hang Tag $ .01
Dust Bag
NW Bags 100% Recyclable Organic Cotton Qty: 5,000 $150 Cost Per Dust Bag $.03
Labels UNLINE
Model NO. 5933, White, 2 color ink, 1 ¼” X 2 ½” Oval Printed Label 5,000 per roll- $.04 per label (Prices based on quantity of 5,000 labels)
$207.50 $.04
Consumer Education
Educational brochure: With company, mission and vision, product details, and care instructions to be placed with handbag.
Brochure U Printing
Brochure 6â&#x20AC;? X 4â&#x20AC;? Half Fold, Printed Brochure 5,000 - $.03 per brochure
$154.00 $ .03
Recycled Hang Tags “Be Eco-Friendly with Recycled Hang Tags” “When opting for an online printing company such as UPrinting.com to do your hang tag jobs, by purchasing even just one recycled hang tag from them has made you help the environment by supporting their eco-friendly materials. If you wish to have eco-friendly hang tags produced at UPrinting.com, you can be assured that a 13 pt. uncoated cover stock is made of 30% recycled material. For a recycled hang tag printed in 100 lb. gloss cover and 100 lb. gloss text cover stocks, these tags are 10% recycle-produced as well. Apart from purchasing a recycled hang tag, another practice on recycling at UPrinting.com is that all paper scraps, printing plates, and ink waste are reused within the company. This sort of practice helps in further supporting their environmental cause by eliminating inappropriate waste that can also do harm in the cleanliness of the environment. With custom hang tag printing jobs on at UPrinting.com, you get environmentally friendly materials without lessening the quality of your prints; and caring to support means that you have somehow increased awareness to others by providing referrals and by having additional printing requests in the future”. (UPRINTING)
Conclusion
Kana Avani was founded with the pure purpose to fulfill an environmentalist conscious consumer but yet stylish and trendy. The goal of our designs follow the needs and expectations of the technological and fast passed world we are living today. We provide longer life to our product as well as recycling, encouragement to improve and reduce textile waste. Our mission as a company, is to portray a brand identity that is socially responsible with the environment, our customer, and our employees throughout our entire production line.
APP ENDIX
Appendix A
Appendix B and C
MICHAEL KORS HOLDINGS LIMITED AND SUBSIDIARIES CODE OF CONDUCT FOR BUSINESS PARTNERS (As of July 17, 2014) Michael Kors Holdings Limited and its subsidiaries are dedicated to conducting their operations throughout the world on principles of ethical business practice and recognition of the dignity of workers. We expect our business partners to respect and adhere to the same standards in the operation of their business, and we will utilize these criteria to evaluate our relationships with customers and suppliers. This Code of Conduct is available on the Supply Chain Disclosure page of our website at www.michaelkors.com and may be updated from time to time. WAGES/BENEFITS/WORKING HOURS. Our business partners must comply with all laws regulating local wages, work hours and benefits. Wage and benefit policies must be consistent with prevailing national standards, and also be acceptable under a broader international understanding as to the basic needs of workers and their families. We will not work with companies whose wage structure violates local law or prevailing industry practice. CHILD LABOR. Our business partners must not use child labor, defined as school-age children. Our business partners will not employ workers under the age of 15. This provision extends to all partner facilities. HEALTH & SAFETY. Our business partners must ensure that their workers are provided a safe and healthy work environment, and are not subject to unsanitary or hazardous conditions. FREEDOM OF ASSOCIATION. Our business partners should respect the legal rights of employees to freely and without harassment participate in worker organizations of their choice. PRISON OR FORCED LABOR. Our business partners will not work with or arrange for purchase of any materials from business partners who utilize prison or forced labor in any stage of the manufacture of our products. DISCIPLINARY PRACTICES. Our business partners will not employ or conduct any business activity with partners who employ any form of physical or mental coercion or punishment against workers. DISCRIMINATION. Our business partners will not practice nor do business with business partners who practice any form of improper discrimination in hiring and employment, including on the basis of age, race, color, gender, or religion. ENVIRONMENT. Our business partners must embrace a fundamental concern for environmental protection and conduct their operations consistent with both local and internationally recognized environmental practices. LEGAL REQUIREMENTS. Our business relationship must be built on a mutual respect for and adherence to legal requirements. Our business partners will observe both local and applicable international standards. ETHICAL STANDARDS. We intend to conduct all our business in a manner consistent with the highest ethical standards, and we will seek and utilize partners who will do likewise, as this contributes directly to our corporate reputation and the collective success of our organization and selected business partners. CONFLICT MINERALS. We encourage our suppliers that use conflict minerals ─ cassiterite (tin), columbite-tantalite (tantalum), gold and wolframite (tungsten) ─ that are necessary to the functionality or production of products that Michael Kors manufactures or contracts to manufacture to source product in a socially and environmentally responsible manner and in accordance with the separate Conflict Minerals Policy of the Company available on the Investor page of our website at www.michaelkors.com. SUBCONTRACTING. Our business partners may not subcontract all or any part of the work on our products without our express written consent, which will not be given unless each subcontractor meets all of the criteria set forth herein. ANTI-BRIBERY. It is illegal and against Company policy for our business partners to offer, pay, promise to pay or authorize the payment of money or anything else of value to any government or administrative official (whether directly or through an agent or other intermediary) for the purpose of influencing an act or decision or securing an improper advantage for the Company. GIFT GIVING. Our business partners are prohibited from giving to our employees or agents, or receiving from our employees or agents, gifts in excess of US$100.00 and no gifts may be given or received in cash or its equivalent. Furnishing or receiving meals, refreshments and entertainment in conjunction with business discussions is permitted. CONFLICTS OF INTEREST. Our business partners are expected to avoid conflicts of interest or potential conflicts of interest with our employees. A conflict of interest may arise when an employee or a member of his or her family or any of his or her affiliates receives improper personal benefits (in the form of money, gifts, personal favors or anything else of value) as a result of his or her position in the Company (other than in accordance with the Company’s gift giving policy referred to above.) IMPLEMENTATION. We will apply these criteria in all business partner determinations, and will continue to implement these policies in the conduct of all activities. This will include our business partners sharing information on production facilities and procedures, with the objective of improving our collective service to customers in a responsible manner. Failure by a business partner to meet these standards, will result in our taking appropriate actions, up to and including cancellation of existing orders.
Appendix D Ellington
Vegan Chic
Crystalyn Kae
Appendix E and F
6
Sustaina bility G o als CATEGORY
Energy Consumption
Hosting Renewable Energy Sources (i.e., solar)
Paper Consumption
Use of Recycled/ Certified Paper
Use of Sustainable Building Materials in Major Construction
Reduce the amount of paper we use by at least 20 percent by 2010 (from 2006 levels).
Increase the percentage of thirdparty certified and/or recycled (10 percent post-consumer waste or higher) paper we use in marketing materials by 20-fold by 2010 (from 2006 levels) to at least 50 percent.
N/A
By 2015, install an additional 25 percent to 35 percent of solar power systems from 2012 levels.
By 2015, manage the amount of paper we use so the annual rate of growth is at least 20 percent less than the increase in the number of sales transactions in our stores and online. This is on top of a reduction of 11 percent in the 2007 to 2012 period.
Increase the percentage of thirdparty certified and/or recycled (10 percent post-consumer waste or higher) paper we use in marketing materials to 95 percent by 2015 from 43 percent in 2009.
Increase the use of sustainable building materials in all major construction projects by 15 percent by 2015 (over 2012 levels).
About 23,599 Megawatt Hours of renewable energy are generated annually on 44 Macy’s facilities (by year end 2013), and all but 3,700 Megawatt Hours are sold to others.
At the end of 2012, total paper use has been reduced by 11 percent since 2007.
In 2012, 93 percent of all paper used by Macy’s in marketing materials (such as direct mail) is recycled (10 percent postconsumer waste or higher) or certified, up from 3 percent in 2006. About one-half of marketing paper is Forest Stewardship Council-certified.
Sustainability now built into all Macy’s and Bloomingdale’s store design, remodel and construction projects. Use of sustainable building materials increased by more than 50 percent between 2011 and 2012.
INITIAL GOAL SET IN SPRING 2008 Reduce total energy use on a kilowatt-hour-per-square-foot basis by another 10-15 percent by 2010 (recognizing that the company reduced energy consumption by 9 percent over the past five years).
Increase our use of renewable power sources eight-fold by 2010 from 2006 levels.
ENHANCED GOAL RE-SET IN 2013 Reduce total energy use on a kilowatt-hour-per-square-foot basis by another 6-10 percent by 2015 (compared with 2012 levels), recognizing that we already have reduced our energy consumption by about 37 percent over the past 10 years.
CUMULATIVE IMPACT At the end of 2012, total energy consumption on a kilowatt-hour-per-square-foot basis has been reduced by 37 percent since 2002.
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260 Holbrook Drive, Wheeling, IL 60090 USA
T: 847.657.8481
F: 847.657.8641
customerservices@brentanofabrics.com
This report was created for the class FASM 400: Contemporary Issues in Fashion Merchandising Savannah College of Art and Design Prof Meeta Roy Fall 2014 By: Isabella Espinal Monica Martinez Stephanie Tedder