Sport Obermeyer, Ltd was founded by Klaus Obermeyer to provide U.S. skiers with the same protective and stylish clothing and equipment available in Germany. Over the years, Sport Obermeyer developed into a preeminent competitor in the U.S. skiwear market. Their estimated sales in 1992 were $32.8 million. The company held a commanding 45% share of the children’s skiwear market and 11% of the adult skiwear market.
Obermeyer offers a broad line of fashion ski apparel, including parkas, vests, ski suits, shells, ski pants, sweaters, turtlenecks, and accessories. Parkas are considered the most critical design component of a collection; the other garments were fashioned to match the parkas’ style and color. Their …show more content…
The production process for Sport Obermeyer apparel begins a full year and a half before the apparel actually hits the market. They use a multi-phase production process. This has advantages and disadvantages. An immediate concern is to determine an appropriate production commitment for the projected demand for the 1993-94 season. They also need to decide where to produce the 10,000 units for the first phase and they need to decide which styles will be made in Hong Kong and which ones to be produced in China. This year, Obermeyer expected to produce about half of all its’ products in China.
In the longer term, Wally wondered whether producing in China would constrain Obermeyer’s ability to manage production and inventory risks. Would China’s larger minimum order sizes limit the company’s ability to increase the range of products it offered or to manage inventory risk? Was Obermeyer’s trend toward increased production in China too risky given the uncertainty in China’s trade relationship with the United States?
There are a few key components that make the supply chain difficult to manage:
Long lead times high inventory o Global supply chain