Crocs Case Study

Crocs Case

Crocs' first core competency is its extremely flexible supply chain that is quickly able to respond to variations in demand thus, preventing a significant amount of lost sales. In contrast with other players in the footwear industry, Crocs owns manufacturing facilities which enables to it vary production in line with the demand. This also has the added benefit of improving Crocs' reputation with the retailers who are more likely to order from Crocs due to a reliable partnership as compared to its competitors. The retailers even want to offer more space to Crocs' products. Moreover, Crocs doesn't have to mark down its shoes at the end of the season because of its efficiency in closely matching production to sales.

Crocs' second core competency is its proprietary resin "croslite" technology that gives the company's shoes their unique comfort as well as odor-resistance properties. The material of the shoes instead of their design and looks is responsible for the phenomenal success of Crocs.   

Crocs already owns the proprietary resin "croslite" technology and it has also built state-of-the-art compounding facilities in Canada, China, and Mexico thus, reducing its reliance on the Italian company. Italian company has done a good job so far but building new compounding facilities has improved Crocs' supply chain network in terms of time and cost savings and has eliminated the risk of total collapse in case Italian company runs into unseen problem. Further vertical integration opportunity for Crocs lies in purchasing suppliers of raw materials such as pellets as well. Raw materials such as pellet are not expensive at the moment but as the company will continue to grow as well as increase demand for raw materials, the demand force may push the prices of raw materials upward as well. Purchasing suppliers of raw material will ensure that Crocs will have more control over production costs in the future. Crocs may own the croslite technology but that may not be...