Sports Obermeyer Case Review

In this case study we discuss the problems faced by Sport Obermeyer, a fashion skiwear manufacturer. Every year the company had to produce a new line of clothing according to the latest trends and fashions. The success of the company depended on how well Sports Obermeyer was able to predict market response to different styles and colors. Intense competition had made forecasting really difficult. The two scenarios that resulted were products in style sold out and the products not in style were sold at prices lower than the manufacturing cost. China was where one third of Sports Obermeyer’s products were being manufactured and this year half of the products were being manufactured in China. Since the operations and production facilities are subcontracting the manufacturing to different facilities in China, Sports Obermeyer is really concerned about allocating production between factories. Quality and reliability were also a big issue. Obersport Ltd was a joint venture to coordinate the production of Sport Obermeyer products in the Far East.

It was also responsible for fabric and component sourcing for Sport Obermeyer’s entire production. The new facility in Lo Village, which was run by Alpine Ltd, was a subcontracted manufacturing facility. Alpine generated 80 percent of its business from Sport Obermeyer. Apline Ltd invested a lot of money in the new facility and was hoping to get more business from sports obermeyer. The main competitor of Sport Obermeyer which made 32 million dollars in the year 1992 was Columbia sport. Sport obermeyer divided the adults where they had only 11 percent market share into 4 types; they are the Fred, Rex, Beige and Klausie. From the graphs we notice that there is a rise in the Storage keeping units from the last 5 years, Number of styles remained constant and the average sizes per person had increased considerably. The approach the management was divided into two between the father who started the firm and the son who was a Harvard graduate. Wally Obermeyer relied on formal data gathering and analytical techniques. The order cycle depended on products being shipped to special ski stores, some departmental stores and direct mail retailers.

The design process involved predicting trends in the American markets via the current trends in the Europe market. The designs and planning for the year 1993-94 was done in 1992. Sample garments were produced first, and then raw materials were sourced. The lead times for delivery of these raw materials were 90 days. The styles and designs were then produced and sent to sport obermeyer who would distribute it to retailers. The data in the tables and diagrams showed the various lead times for various production facilities. The second table shows the assembly operations for the rococo women’s Parka.

The third table was the comparison of operations in china and Hong Kong. Production planning was a serious issue which Wally feels is the key factor in turning over the profits that the company is not capitalizing. Wally Obermeyer needed to decide which styles to make in Hong Kong and which would be better to produce in China. Since Alpine was promised that more than half of the production, is it a better idea in the long run. Sports Obermeyer has to compare operational problems and also complete his commitment of at least 10,000 units. In the longer I would recommend that due to the challenged faced by regulations in China along with less quality and cleanliness, Hong Kong is a better option in the longer run.