Outdoor Voices
Global Sourcing Ariel Chang, Oudulin Chen, and Rachel Johnson
Doing Things.
Contents 06
10
18
24
About OV
Products
Supplier Analysis
Country & Supplier Rankings
Mission Vision Values Logistics Target Market Product Categories Item Range
Backpack Drawstring Duffle Bag Bumbag
20 Strategy
14
16
Country Analysis
Country Selection
Location Sustainability Fair Labor Laws Technology Trade Agreements Cost
China: Danyang Eastern Outdoor Equipment Hong Kong: Prana Mfg Ltd Taiwan:Kodex Travelware Co.
China Hong Kong Taiwan
Publication Conclusion
27 Company Sourcing Guidelines Social Environmental Giving Back
22
29
Line Plan
Index and Work Cited
Line Plan Unit Breakdown Costing
About OV
CEO & Director—Tyler Haney President & Partner— Andrew Parietti
Mission, Vision, & Values Mission Outdoor Voices works on the concept of providing apparel for people who are active, but not solely “defined by that activity.”
Vision Outdoor Voices’ vision is to bring people together through activity.
Values Doing Things is better than not Doing
Logistics
Store Locations ATX
606 Blanco St. Austin, tx 78702 – 5308
NYC
199 Lafayette St. New York, NY 10012-4279
Ta r g e t M a r k e t
Kayla
Parker
26 years old
29 years old
$60,000/year
$80,000/year
Campaign Marketing Specialist
Owns tech start up company
New York City, NY
Austin, TX
Urban dwellers
B.S Marketing from New York
B.S Business from University of
College graduates
University
Texas at Austin
Urban Tastemaker Athlete Men and women 21-35
Active lifestyle Early Trend Adopters
Product Categories Womens
Hoodies- $85 Leggings- $95 Sports Bras- $55 Sweats- $95 Shorts- $65 Tops- $55
Our classic silhouettes are understated yet refined, and technically constructed to sweat in without sacrificing sartorial style or comfort.
Mens
Hoodies- $100 Jackets- $120 Sweats- $100 Shorts- $65 Tops- $65 Tanks-$65
Product Expansion
Style #1
Style #3
Weatherproof coated canvas backpack with
Two handled retro duffle. Classic and
$155
$125
laptop case and leather detailing. Two
simplistic in style with weatherproofed
interior zippers.
textiles. Leather handles. Polyester body.
Style #2
Style #4
Coated heavy weight nylon with seperate zip
Classic, retro pouch that attaches at
compartment from main body compartment
waste with buckle. Weatherproof coated
at bottom of bag used for after work out
canvas. Zip front. Two inside pockets.
sweaty clothes. Sling strap for wearing on
Small key pockey on right side of
shoulder.
pouch. Backfacing zip on body of bag.
$145
$85
Country Analysis We believe it is our responsibility to uphold the highest standard of ethical practices with the factories producing our goods—including labor rights and sustainable sourcing and manufacturing.
Location Outdoor Voices is headquarted in NYC with a store location in the city as well. It is important that lead times are short and frieght costs are low. Environment Knowing the environmental impact of our actions through the entire product life cycle—from the design process to sourcing materials and manufacturing to customer use. It is important to OV that we research the environmental standards within each country of interest. Fair Labor Laws Meeting living standards and healthy working conditions is non-negotiable. It is key for business progression. All employees must be treated fairly and be able to work in clean and safe factories. Technology Countries of interest must use techonology to result in added proficiency. The countries must be open to innovation through the use of technology.
#DoingThingsTheRightWay At Outdoor Voices we believe that Doing Things is better than not Doing Things, especially in regards to sustainability in sourcing practices and manufacturing.
Free Trade Agreements The countries must either have a FTA in place with the United States or have a strong business and economic relationship with the United States. Cost Production costs must be low enough to ensure profitability but never to jeopordize the wages of factory workers producing our backpacks.
Country Selection
Hong K ong
Benchmarks
Location
Su s t a i n a b i l i t y
Labor Laws
Te c h n o l o g y
Tr a d e A g re e m e n t s
Cost
China Located in Eastern Asia, bordering the East China Sea, Korea Bay, Yellow Sea, and the South China Sea. China has the world largest apparel and textile industry, also has the largest number of labor force in the world. Besides, China is the world largest cottongrowing region, which make it really powerful in producing cotton related goods. There is a labor law in China but it does not yet meet the international labor law standards. The minimum wage of this year is still at a very competitive price of 2020RMB ($316.995) per month that attracts a lot of companies overseas. Since the country has the world largest carbon dioxide emissions, not only the government but also the factories have started to set up the initiatives in sustainability, even tough it seems like the problem is still huge. China now heavily relies on the available technology but still trying to implement the new technology and improve innovation as well. United States is the 1st export partner of China. However, there is no trade agreement between the two countries.
Hong Kong is located in the eastern Asia, bordering the South China Sea and China. It exports 18.78% of apparel accessories globally with high qualities which makes it one of the ideal countries for our product category. The country puts strong efforts on sustainability in order to meet their energy standards and to minimize the environmental impact of electricity generation. There are comprehensive labor laws in place to protect labor workers and their rights, which complies with our company’s code of conduct. Hong Kong’s minimum wage is relatively high at 32.5HKD ($4.193) per hour with a skilled workforce, resulting in better quality products. Hong Kong has a well-developed infrastructure in production and manufacturing, and they also continue to work on improving new technologies for implementation. In addition, the U.S.-Hong Kong Policy Act of 1992, Tax Information Exchange Agreement (TIEA), Inter-governmental Agreement (IGA), and Asia-Pacific Economic Cooperation (APEC) agreements enable the U.S. to be Hong Kong’s second largest exporting country.
Tai wan Taiwan is located in eastern Asia, and its islands bordering the East China Sea, Philippine Sea, and the South China Sea. It is the 6th largest textile exporter in the world with about 4,375 apparel and textile manufactures. The country has 11.54 million of labor force with a minimum wage of 19273NTD ($586.858) per month, protected by the Labor Insurance Act which was passed into law in 1958, the 1984 Labor Standards Law, and so on. Sustainability is now a big concern in Taiwan especially in the high-tech manufacturing, and some of the companies have started saving energy and reducing carbon emissions in their production. Taiwan has stable technological infrastructures, as well as the comparative advantages in textile, biotechnology, and food technology, etc. The US is its 2nd largest trading partner. Furthermore, there is a trade agreement between the US and Taiwan which called Trade and Investment Framework Agreement in 1994.
Supplier Analysis Chi n a Dan yan g E aste rn Outdoor Equipment C Danyang Eastern Outdoor Equipment is located in Jiangsu Province, China and they are a top exporter of various types of bags. All of their products comply with international quality standards and cater to a variety of different markets throughout the world. Their manufacturing facilities are large in scale with 200 workers and 10 designers with advanced skills and powerful production capabilities. They align with our goals, in that their principle is “quality is our life”.
H on g Ko n g Pr an a Mfg L td . Prana Manufacturing is located in Hong Kong, China and they specialize in various types of backpacks, sports bags, and casual bags. They have a very large facility and are diligent in maintaining the organization of production as well as the working environment. With Hong Kong’s minimum wage being relatively high at US$4.20 per hour, they strive to ensure the happiness of their workers while making sure their performance stays efficient.
Ta i w a n Kodex Travelware Co. Kodex Travelware was established in 1982 and has long been the top exporter of luggage and bags of all types in it’s country. They are located in Taiwan with a large production facility of 10,000 square meters and 350 well-trained, experienced workers. The workers are all very skilled and capable of producing the highest quality goods.
* Se e Mo re In f o r m a t i o n o n Su p p l i e r s i n In d e x
Strategy Publication
Strategy Conclusion
Country Based on our product category, we prefer to work with a country that has a large apparel & textile industry which can provide numerous of suppliers with rich experience for us to pick. Outdoor Voices has part of the product lines manufactured in Hong Kong already, in addition Hong Kong has such a great performance in apparel accessories manufacturing. So we seek this is a great opportunity for us to get along with this country, as well as China and Taiwan. Sustainability, Corporate social responsibility and socio-eco-political stability are our prior concerns. When we research those three countries, we also found the comparative advantages for each country which are low labor cost in China, higher quality standard in Hong Kong, and advanced technology in textile manufacturing.
Supplier After selecting our countries, we evaluated each manufacturer based on their capability to produce the various bags for our product extension. Since we have a wide variety of bag styles, from drawstring bags to bumbags, we strategically screened each supplier for skillset, quality, and services offered. We felt it was necessary to look for these factors in order to meet our high standards and provide the best quality products for the Outdoor Voices customer. Along with these components, we made sure that the factories complied with our CSR standards especially when it comes to fair living wages and working conditions. We believe it is our responsibility to ensure the safety and overall wellness of the individuals creating our products, therefore it is pertinent that our suppliers meet our guidelines. Overall, we at Outdoor Voices look for manufacturers who are capable of producing the best quality at the most profitable costs, and most importantly align with our company goals and standards.
The three factories we selected in China, Hong Kong, and Taiwan best reflect the goal of profitability and support a 75% markup. Furthermore, these factories and countries were able to meet benchmarks that Outdoor Voices had for our various corporate social responsibility guidelines including environmental concerns and human rights concerns, as well as being a promising and stable trade partner with quality control, technology integration, and a skilled work force. These countries proved to be overall stable and a reliable partner in production of our high quality unisex sportswear bag line.
Line Plan O u t d o o r Vo i c e s L i n e P l a n
SEASON STYLE #
NAME
JAN
FEB
MAR
APR
MAY
Style #1 Style #2 Style #3 Style #4
BACKPACK DRAWSTRING DUFFLE BUMBAG
650 450 450 175
550 350 400 150
400 350 300 100
350 200 350 200
350 200 450 200
1725
1450
1150
1110
1200
TOTAL
AUG
SEPT
OCT
NOV
DEC
TOTAL
300 200 400 100
550 350 350 100
600 400 400 100
300 200 250 75
200 200 250 75
900 750 800 250
800 600 700 175
5950 4250 5100 1700
1000
1350
1500
825
725
2700
2275
17,000
Cost Sheet
Unit Breakdown
Style #1 Style #2 Style #3 Style #4
JUL
JUN
BACKPACK DRAWSTRING DUFFLE BUMBAG TOTAL
% UNITS
UNITS
RETAIL per unit
35% 25% 30% 10%
5950 4250 5100 1700
$155 $145 $125 $85
100%
17,000
RETAIL total $922,250 $616,250 $637,500 $144,500 $2,320,500
COST per unit
COST total
MARGIN
MARGIN%
$38.75 $36.25 $31.25 $21.25
$230,563 $154,063 $159,375 $36,125
$116.25 $108.75 $93.75 $63.75
75%
$580,125
$382.50
75%
Country Ranking China
Explanation
Hong Kong
Explanation
Taiwan
Explanation
Business Climate
6
Relatively lower overall economic freedom compare to the world average
10
Recgonized as one of the most free market in the world, with just little government intervention
8
Overall ecomomic freedom index set in between Hong Kong and China
Costs
9
Minimum wage of $316.995 (2020RMB) per mouth
6
Minimum wage of $805.056 (32.5HKD per hour) per mouth
8
Minimum wage of $586.858 (19273NTD) per mouth
Government
7
Issues with corruption, but it is now improving
8
“One country, two system” allows HK to run the own political and legal institutions
8
Overall it is very stable and well structured
Location
7
Located in the eastern Asia
7
Located in the eastern Asia
7
Located in the eastern Asia
Risks
6
Inflation and rising labor costs; Counterfeiting products; corruptions issues
6
Exchange rate dilemma; economy in recession; souring public sentiments with China
6
High-risk for natural disaster; the political conflitcs between the mainland China and Taiwan
Social Stability
9
The gorvernment has focused on reducing disparities by increasing wages and providing more welfare benefits
9
Hong Kong’ human development performeance is impressive; aging society may strain future finance though
9
Taiwan has an aging population and a status of possessing one of the world’s lowes fertility rates
Sourcing Guidelines
6
565 factories in China are WRAP certified. However, child-labor, exceeding working hours issue are still existing
7
The majority of factories have set up the workplace code of conducts.
7
8 factories are WRAP certified.
Textiles Industry
10
World’s largest textile industry
9
World’s top 5 largest textile industry, products with higher quality
8
World’s 6th largest textile industry
Trade Agreements
6
No actual trade agreement with the US, even US is act as the 1st export partner of China
8
The US-HK Policy Act of 1992; TIEA;IGA;APEC
7
Trade and Investment Framework Agreement in1994
Trained Workforce
7
Relatively lower ratio in trained work force, however, due to the large number of population, it is still not a small number
8
Relatively higher percentage in skilled Workers but slowly tightening due to the stronger demand
8
Due to its great technological infrastructure, it needs the labors to be trained before working
Socio-eco-Poli
8
Pretty Stable in General
8
Pretty Stable in General
8
Pretty stable in general
Average Points
7.4
7.8
7.6
Total Points
81
86
84
Supplier Ranking
Abilities
Capacity
Company Sourcing Guidelines
Danyang Eastern Outdoor Equipment C (CHINA)
Prana Mfg Litd (HK)
Kodex Travelware Co (TAIWAN)
10
9
10
8
9
9
We believe it is our responsibility to uphold the highest standard of ethical practices with the factories producing our goods—including labor rights and sustainable sourcing and manufacturing.
Transparency Create Corporate Social Responsibility Page on Website
Lead Time
7
6
5
Create open line of communication with customer about sustainability efforts Publish supplier and manufacturer list
Quality
Customers
10
10
Sourcing Guideline
7
Services Offered
10
Strategic Outlook
Total
9
71
9
8
6
7
7
61
10
8
8
9
10
69
Environment Knowing the environmental impact of our actions through the entire product life cycle—from the design process to sourcing materials and manufacturing to customer use.
bluesign certified: —A solution for a sustainable textile production. —It eliminates harmful substances right from the beginning of the manufacturing process and sets and controls standards for an environmentally friendly and safe production. —The final textile product meets strict consumer safety requirements worldwide while providing consumer confidence in obtaining a sustainable product
LEED Certification: —Leadership in Energy & Environmental Design—U.S. Green Building Council —Make necessary adjustments to attain LEED certification of both the Outdoor Voices Austin, TX store and the New York City offices. —Being energy efficient and environmentally friendly in the
Social Responsibility Human Rights are taken extremely seriously when determining whether or not a source meets our strict guidelines regarding living wages, worker health and safety, and child labor laws. Outdoor Voices looks to set high standards in their Workplace and Vendor Compliance Code of Conduct. Our code of conduct is based on International Labor Organization (ILO) core labor standards. It requires compliance with all laws in each of the countries in which our factories operate.
Supplier Workplace Code of Conduct:
Law and Code Compliance
Hours of Work
Child Labor
Health and Safety
Forced Labor
Environment
Harassment, Abuse &
Community
Disciplinary Practices
Subcontracting
Discrimination
Animal Welfare
Freedom of Association
Traceability
Wages and Benefits
Code Communication
Overtime Wages
Quality
Fair Labor Association Accreditation provides customers with an extra layer of assurance and transparency, FLA records may be publicly accessed. FLA allows for an objective party to help evaluate what we are doing well and what we should improve upon. FLA randomly audits a sampling of our supply chain to assess the factory monitoring.
Giving Back Environmental Support through 1% for the Planet 1% of sales to the preservation and restoration of the natural environment. Donations to domestic and international grassroots environmental groups making a difference in their local communities. Community Outreach through Austin Parks and Recreation As a company we believe in Doing Things. Outdoor Voices gives back to the active community by volunteering and participating with Austin Parks and Recreation to build community gardens in order to sustain local agriculture.
Index
Hong Kong
Supplier Analysis Information China
Danyang Eastern Outdoor Equipment C
Prana Mfg Ltd. Shipments: 470 Specialties: polyester backpacks, tote bags Customers: Trimble Navigation Ltd., M.London Inc., Old Navy Inc.
Shipments: 115
Contact: 852.2521.5636
Specialties: polyester, keyboard, headwear
Address: Unit 902 Mirror Tower 61 Mody Road Tsim Sha Tsui, Kowloon, Hong Kong
Customers: Herschel Supply Co., Madewell, J Crew
Departure Port: Xiamen, China
Contact: yinwen6556@163.com http://Danyang_Eastern_Outdoor_Equipment_C_Ltd, +86 511 8576 6502
Destination Port: New York, New York
Address: No6 Fangcao Economical Zone, South G Ate, Danyang Cn 212300, China Departure Port: Shanghai, China Destination Port: New York, New York
We manufacture OEM for all kinds of licensed and non-licensed backpacks, sports bags & casual bags. (http://www.hktdc.com/sourcing/hk_company_contact_information. htm?companyid=1X02NPU3&locale=en)
Ta i w a n
Kodex Travelware Co.
Danyang Eastern Outdoor Equipment Co., Ltd. is a professional manufacturer and exporter of bags, including backpacks, solar bags, travel bags, trolley bags, hiking bags, waist bags, lap-top bags, cooler bags, wallets, handbags, skate-board bags, fishing luggage and others. All of our products comply with international quality standards and are greatly appreciated in a variety of different markets throughout the world. Founded in 1992 and located in Fangcao Economical Development Zone, South Gate, Danyang, Jiangsu Province, China, we have a large scale manufacturing facility covering a total area of 25,000 square meters. Now we have 200 workers and 10 designers, so we have advanced skills and strong and powerful production capability. In 2008, we attained ISO9001:2000 certification. Based on our guiding principle of “Quality is our life”, we continually strive to exceed our clients’ expectations. If you are interested in our company and products, please contact us without any hesitation. We will provide our best price and service with good quality for you.
Shipments: 276
Total Annual Sales Value: $5 Million -$10 Million
KODEX was established in 1982, has been dedicated to manufacture and Export luggage, travel bags, sporting bags school bags, computer bags, Ladies Handbag ….worldwide. We have 2 factories, one in Vietnam, of maore than 10,000 suare meters with 700 well trained workers in Hochiminh City, can produce excellent quality goods. Another in Yang Zhou City, China. Currently we have 350 experienced workers And expect to expand to 2000 workers in the near future, Can provide completive Products.
Employees: 500 people (http://eastern-outdoor.en.forbuyers.com/)
Specialties: sportswear accessories (totes, backpacks, duffle) Customers: Briggs and Riley Travelware, Timbuk2 Designs Inc. Contact: susy@kodex.com.tw 886-2-27081593 Address: 8F.,NO. 6, SEC. 2 FU-SHING S.ROAD, TAIPEI, TAIWAN Departure Port: Taiwan Destination Port: Newark, New Jersey
http://www.bags.org.tw/english_version/factory/factory03.php?doaction=VIEW&ID=75
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