H&M May Be Going Out of Style

H&M May Be Going Out of Style

H&M, the Swedish fashion retailer, became famous for rapid conversions of runway fashions into affordable street clothing. This strategy led to stellar growth with thousands of store openings worldwide.

Lately, the company seems to have lost its momentum. Store sales have slowed, and unsold inventory has piled up. Clothing trends are very short-lived, making it difficult to introduce new products in a timely fashion (no pun intended).

This post is based on the NY Times article, H&M, a Fashion Giant, Has a Problem: $4.3 Billion in Unsold Clothes, by E. Paton, March 27, 2018. Image source:
Erica Simone Leeds
.

Discussion Questions

1. What factors have contributed to H&M’s sluggish store sales?

Guidance: Discuss the intense competition from Zara and other competitors, the decline in brick-and-mortar retail store sales, distasteful advertising, the inability to respond quickly to changes in demand globally, and top management’s apparent failure to identify the roots of the problem and fix it.

2. According to the author of the article, luxury brands and quality apparel have made a come-back. From a product design perspective, what does it mean for H&M?

Guidance: Discuss the place of H&M’s fashions in the product life cycle (maturity/decline). Continue reading

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Saline bags, stat!

Saline bags, stat!

Article Title: U.S. Hospitals Face a Shortage of This Most Basic Necessity

Author of Article: R. Langreth and C. Koons

Date of article: November 14, 2017

Source URL: https://www.bloomberg.com/news/articles/2017-11-14/this-simple-lifesaving-liquid-is-suddenly-in-short-supply

This BusinessWeek article describes the shortage of small saline-solution bags for hospitals across the country.

A limited number of suppliers, quality problems, legal probes into possible price-fixing, and the destruction of factories by Hurricane Maria have contributed to a dangerously short supply of the bags which are used to administer hundreds of different medicines. Inventory levels of many essential drugs are also very low, making it difficult to respond to sudden disasters.

To cope with these problems, hospitals are trying to change the drug delivery system from injectables to alternatives. However, this process is complicated because it involves a redesign of the workflows.

Discussion Questions
1. When there is uncertainty in lead times, organizations carry higher levels of safety stock. Is it an option here?

Guidance: Discuss the limited supply of bags in the country and the perishability of injectable drugs. Both make it impossible to order large quantities and keep high levels of safety stock. Moreover, “hoarding” drugs in short supply compounds the problem. Discuss the Continue reading

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