Today we drove over to the corporate headquarters of jeanswear for the VF Corporation, which is located in Greensboro. We had the opportunity to hear multiple employees speak on their positions in the company, as well as, how their respective departments contribute to generating profit and customer satisfaction. Organized in 1899, VF is a worldwide leader in brand lifestyle apparel, footwear, and related products. The company is organized by five dfferent coalitions: outdoor & action sports, jeanswear, imagewear, sportswear, and contemporary brands. They produce 28% and source 72% of 450 million units annually across 36 brands. Having about 57,000 employees in 150 different countries, VF produces about 60% of their products internationally, the premier locations being Mexico, Honduras, and Bangladesh. VF Corporation has recorded $10.9 billion in revenue and $1.5 billion in operating income for this past year.
The mission of VF Corporation is to create the leading jeans and lifestyle apparel company in North America by offering consumers brand product solutions at compelling value. Their goal is to constantly exceed the expectations of their consumers, shareholders, and business partners. By using deep research and insights, the innovative company combines the art and science of apparel in an effort to create products that excite customers and inspire brand loyalty.
VF Corporation’s customer base extends to people all across the globe seeking to purchase quality lifestyle apparel. Typically these customers buy the company’s five largest brands, The North Face, Vans, Timberland, Wrangler, and Lee. VF’s sales are highly diversified as 25% occur via e-commerce or owned stores (~1,100) and 40% of sales occur outside the United States. The business has 32 distribution centers that provide their products to big-business customers such as Walmart, Target, K-Mart, Kohls, Macys, Sears, and JC Penney, who then sell the products to individual customer. Tractor Supply and Boot Barn are examples of smaller companies that also purchase certain products from VF.
The customers of VF Corporation value a unique, quality product that caters to their individual style. A great example of this is Wrangler’s “U” shaped jeans as they provide more comfort and durability for an outdoorsy type person. Another example is how they produce three different types of Wrangler jeans to appeal to the western look. Their customers also value having a variety of color combinations (about 760,000) and textures to choose from when purchasing the products. Furthermore, they value having an influential voice in what they what from VF’s brands. As Chris stated, the company’s brands are “what the customers say they are”.
The results show that VF Corporation does an excellent job of living up to what they promise and that they remain the best in their field. In 2012, the company recorded revenues of 10.9 billion dollars and operating income of 1.5 billion dollars. If this isn’t profitable enough, those numbers are both expected to grow, estimating nearly 17 billion dollars in revenue by 2019. Producing about 15 units per second, VF corporation stands as one of the most efficient manufacturers in their field as well. Even during tough economic circumstances, the company’s stock continues to grow, having gone up an astounding 69% in the last year. Because VF never accepts to be less than the top two in what they do, their results should be just as good in the future.
Before VF creates a plan, they focus on addressing the “Who, What, & How”. Because there is not big business in the department stores, yet still significant growth opportunity, VF Corporation plan is to generate revenue quicker through improving their action sports department and turn profit into acquisitions. Chris said that the strategy for meeting this goal is to find a way to appeal to new customers, make lifestyle brand extensions, generate new wholesale accounts, and provide directly to the customer. He provided us with a pyramid looking graph that showed how the company moves forward, which entails maximizing what already exists, building leverage, igniting expansion, and exploring new possibilities. VF is also seeking to turn the jeanswear department into a 3 billion dollar business.
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