Patagonia Case Study Essay

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Patagonia Case Study
Key Strategic Issues (Why Important / Summary of Internal / External Analyses)

1) Balancing Commitment to Business with Commitment to Environment
A key issue facing management was balancing the company’s desire for environmentalism with its existence as a for-profit business. The idea of running a for-profit business implies operating at the lowest cost, growing as rapidly as financially feasible, and maximizing returns to financial stockholders ( I think it should be stockholder since it is financial return). A commitment to the environment can raise costs and hurt margins because environmentally-friendly policies are not the most financially savvy. This issue is important because Patagonia’s entire brand and
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This is practice enables Patagonia to make decisions with positive environmental effects.

Attracting Younger Demographic without Alienating Existing Aging Customer Base
Patagonia has refrained from focusing on attracting the next generation customer for fear of diluting the brand and chasing fashion trends. We recommend that Patagonia explore the opportunity to either:
1) Create a subsidiary and a new brand that tailors specifically the “dirtbag” customer in the ages of 21-30.
2) Create a new product line that appeals to the previously mentioned demographic. In order to avoid cannibalization of sales, Patagonia should ensure that the new line has that same “dirtbag” ethos but should just appeal to the younger generation. Patagonia should then focus on transitioning the younger generation’s demand into the classic style as they get older.
- For example, the products should maintain all the functionality of the Patagonia system (Capilene base layer, Synchilla over that and breathable outerwear on top) but there is a perceived style difference between the two product lines.
3) Maintaining Quality while reducing Turnaround Time and Costs
1) In order to reduce costs, Patagonia should enter into agreements with more suppliers to allow for more competitive bidding for supplier contracts.
2) In order to cut down on
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