module one crocs case introduction
Module One:
Crocs Case Introduction
Since its inception in 2002, Crocs (NASDAQ: CROX) has sold
more than 300 million pairs of shoes in more
than 90 countries around the world. The company considers itself a world leader in innovative casual. By
2012, the trendy shoe brand was at the height of popularity (Max, 2013). The company was pursuing an
aggr
essive retailing strategy, offering over 300 different designs at nearly 600 retail stores worldwide,
with 315 normal stores, 157 outlet stores, and 122 kiosks. From this perspective
,
things looked brig
ht for
this quirky, proprietary
footwear manufacturer.
Then in 2013, the company’s performance began to publicly unravel.
Although the company saw a rise
of 11.2% in sales revenue, it had also grown its store count by almost 20%. A closer look at the
company’s financials revealed that annual comparable
store sales actually fell in the Americas by 8.3%
and in Japan by 16.3
%
. Internet sales were also lackluster, falling 4.8% year
–
over
–
year (Green, 2013).
By
the s
ummer of 2018, C
roc
s had just 398 locations. Moreover, fans were stunned to hear Crocs announce
that the company was closing its last manufacturing facility. According to Footwearnews.com (2017),
“Crocs challenges undoubtedly come at a time when retail, in general, is under tremendous pressures
and store closures, layoffs and even bankruptcy have be
come par for the course.”
It hasn’t been al
l bad news for Crocs management: I
ts efforts over the past several years to turn around
consumer interest in its quirky lightweight clogs may finally be working. After three years of declining
sales revenue and
net losses to cash flows, the company saw its first profitable quarter in 2018
(Manarriz, 2018). It remains unclear if management can continue to improve Croc
s
’s performance given
the challenging retailing environment the footwear industry faces. Your case
analysis will look to suggest
important considerations of Croc
s
’s situation and recommend at least one course of action to improve
the company’s global competitiveness.
As you approach this first strategic case analysis of this course, keep these basic q
uestions in mind as
you research Crocs’
s
situation:
Why has Croc
s
’s performance always been inconsistent?
How important are global markets to the firm?
How well has Crocs managed its product line?
What is changing about the global footwear industry?
What
is t
he sustainability of Crocs’
s
capabilities in the industry?
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