Posted on 6th June 2011One Response
Canada Goose Inc. at a retail crossroads Case

Summary letter

To: Dani Reiss

Subject: Canada Goose Inc. at a retail crossroads

Current situation

Canada Goose has experienced steady organic growth as a niche brand, selling their product through independently owned stores. By June 2008 it was selling product in 28 different countries across North America and Europe plus two authorized online retailers. Now it has a significant opportunity to further cement itself as a market leader by placing its product with a national chain. Initially, Canada Goose considered offers from two national chain retailers. One offer came from a Canadian chain called Asmuns Place. Another offer came from Levene’s Menswear. Table 1 provides a high level overview and compares these two offers.

Table 1. Brief offer comparisons.

Store\Feature

Est.

locations

% of sale

Markup

Product line

Additional concerns

Asmuns Place

1837

10

High-end;

Large shopping malls

5%

100%

Women’s clothing

Feature products in store advertisements

Levene’s Menswear

1955

20 – with a plan to expend to 40

High-quality

Formal menswear

5%

100%

Menswear only

Sales rep.

80 K + bonus salary

Both offers would allow more flexibility in taking a wider variety and newer models to market. The Production line can accommodate rising complexity. Testing feasibility of new models will allow expansion of Canada Goose offerings to existing delivery channels.

Complications

There are a few existing complications that require attention. Firstly, the Canada Goose brand faces a threat from the increased number of fake products by counterfeiters. Secondly, there is a rising concern from independent stores that national chain stores would discount Canada Goose products causing their sales to drop. And thirdly, Lisa Freedman from Asmuns Place made a last minute offer for exclusive distribution of Canada Goose female and menswear through their store chain. This offer restricts Canada Goose’s flexibility in terms of choosing a distribution partner, but simplifies the distribution process.

Recommendations

Pursue both initial opportunities with the women’s closing product line for Asmuns Place and with the men’s product line for Levene’s Menswear. This will result in an increase in the market share in Canada by 10%. It will provide the ability to bring newer products to market, and not restrict the distribution of products to a single national chain store. Canada Goose should define the conditions under which Asmuns Place or any other retail chain will feature its products in store advertisements. It also needs to assure its original distribution partners that they will be able to maintain their existing brand prestige and pricing throughout all their stores in Canada.

Canada Goose should expand their distribution of its product to Eastern Europe starting with Russia since it is a country with severe winter conditions. This will assure Canada Goose growth without the risk of saturating the Canadian market.

To counter the rising problem of fake products, it is recommended that they launch their own ecommerce site to provide education and assure authenticity of its product.

Next steps

Going forward it is recommended that Canada Goose do the following:

1 – Secure offers from Asmuns Place and Levene’s Menswear. Make sure to specify conditions for in store advertisements in favor of its brand. Hire a sales representative to manage retail chain partnerships only if Levine’s Menswear expands the number of stores to the point where service for the retail chains becomes unmanageable. Manage the variety of products offered in national retail chains in a way that would minimize overlap with products in independent stores.

2 – Set up a meeting with David Steinhauer, owner of Westbrook’s Downtown, and other independent partners to assure them that Canada Goose will restrict product discounting in national retail chains.

3 – Open three flagship stores in Russia, starting in three metropolitan cities: Moscow, St-Petersburg, and Novosibirsk. These cities are famous for cold winters, and dense high-income populations. Also, if Canada Goose were to become fashionable in these cities, its success would be virtually guaranteed in other Post-Soviet countries. It should then establish stores in other large Russian cities and other countries such as Poland, Ukraine and Belarus.

4 – Launch an online campaign. Offer Canada Goose products on its own website for the highest point prices for people who would like to make sure the product is authentic. This tactic should work positively towards brand prestige. Manage forums and blogs to monitor community mood and receive constant feedback.

Case

Canada Goose official site

75%

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