Timbuk2 Case Essays

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Timbuk2: Outsourcing, Offshoring and Mass Customization Introduction: Timbuk2 was founded in 1989 by Rob Honeycutt, a San Francisco bike messenger. Honeycutt wanted to develop a messenger bag that was rugged enough for everyday wear and tear, but chic enough to set a fashion trend. The company founded its success based on its lean manufacturing and mass customization principles. With many of the American companies now outsourcing their manufacturing processes to China, it became hard for Timbuk2 executives to ignore the labor cost benefits that Chinese manufacturing would provide. Dealing with different channels (wholesale/retailers, e-commerce, etc), Timbuk2 also had to find a way to improve their mass customization processes and…show more content…
According to the case, the labor costs for mass customization is about 10% higher than labor costs for large batches or traditional manufacturing. In order for mass customization to work, Timbuk2 will need to determine how many color palettes, design patterns and the types of logos to offer their customers. Overall their challenge for mass customization is to determine whether or not their machines and workforce is capable of manufacturing the design the customer specified. Mass customization and variety can also lead to higher potential for errors. Errors in manufacturing can lead to higher labor cost; the time and money it would take to correct the order is a potential threat to their profitability. One of the benefits of mass customization is that Timbuk2 will provide its customers with “perceived” value-added to their products. The customer can design his/her own bag according to his/her preference, which adds the value of uniqueness to the product. Considering the mass customization option, one needs to consider the inventory in stock. With customization, Timbuk2’s manufacturing department can actually work with less finished good inventory, since the inventory is sent off as soon as it’s finished. They will have less finished goods inventory in stock, which will in turn allow them to offer certain, stocked products at a reduced price. Due to its mass customization practices already in place, it shows that if Timbuk2 were to offer

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