Value Chain Analysis Case Study

European Apparel Chains in the US: Growing Fast and Profitable

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Abstract:
The US apparel industry had witnessed a sea of change following the entry of European apparel retailers. European apparel chains like Hennes & Mauritz (H&M) and Inditex, were eroding the profits of the US counterparts such as Gap and Abercrombie & Fitch (A&F), by eating into their market share through their efficient business models, innovative and fast-changing product offers and lower costs. With a better fashion focus, European retailers were changing the definition of fashion in the US. Instead of creating a certain lifestyle image, they emphasised a strong product focus, a trend driven perspective, but at a lower price.

Pedagogical Objectives:

• To highlight the comparative study on the business models of the US and European apparel retailers
• To discuss the viability and profitability of these models in the long run.

Keywords : Hennes & Mauritz (H&M); Inditex and Zara; Gap; Abercrombie & Fitch (A&F); European apparel retailers; US apparel retailers; Efficient business models; Strong product-focus; Trend driven perspective; Consumer and buyer behaviour; Global supply chain; Growth Strategies Case Study; Efficient inventory management; Fast food of fashion; Faster turnaround of designs; Competitive pricing

Contents:

• Leading Apparel Chains in US - An Overview
• The European Retailers' Business Model
• The Challenges