Timbuk2 Case

732 Words Feb 11th, 2012 3 Pages
The Tao of Timbuk2

1. Consider the two categories of products that Timbuk2 makes and sells. For the custom messenger bag, what are the key competitive dimensions that are driving sales? Are their competitive priorities different for the new laptop bags sourced in China?
For the custom messenger bag, the key competitive dimensions that are driving sales are high-quality custom (bags are worn daily for a decade), reasonable price, high differentiated design (customers select the basic bag configuration, size, color, pocket and strap options themselves), convenience in purchasing (customers can buy bags that are tailored to the exact specifications they like by just getting on the website), quick delivery speed (sent by overnight
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Having each worker move down the sewing line seems like it would also help keep workers alert by having them move around instead of sitting or standing at one station all day.
The rate of production is not so different for the assembly line in both China and San Francisco as Timbuk2 has fine-tuned their production line to make it as efficient as possible in every factory. But the volume is higher in China as China is more efficient and it is able to deliver more quantity at low price since wage rate is low.
Much as in SF, the China factory employs a team of hardworking and good-skill craftspeople. So required skill of the workers is much the same.
The Timbuk2 website says, “We still manufacture all our custom products in San Francisco and we manufacture our ready-made products in China and the Philippines”. Since most of the Timbuk2 bags are handmade and reflects the beauty and the finest quality which cannot be achieved through automation and machineries, we can infer that level of automation must be higher in China.
The business requires cheap raw material and must opt for minimizing finished goods inventory. Manufacturing customized bags is much cheaper in San Francisco. More importantly, China does not provide material advantage because most of the important material comes from Far East. Purchasing materials on a weekly basis allows Timbuk2 to keep its inventory and waste costs down

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