Please enable JavaScript.
Coggle requires JavaScript to display documents.
BSG Strategy Highlights - Coggle Diagram
BSG Strategy Highlights
Key Strategies
Year 11
Balance inventory with demand
Failure
Overproduced by 48,000 pairs
Sell all premium pairs
Success
Sold 439K pairs
Improve image rating
Success
S/Q Rating 7.5
Increase EPS and net profit
Success
Net profit $104.5M
Aggressive marketing & advertising
Success
$16M spent
Year 12
Increase brand advertising
Success
S/Q above 8.0 in all regions
Free shipping internet orders
Success
673K pairs sold online
Aggressive online strategy
Success
Market share above 10%
Keep regional margins positive
Failure
EU/AF operating margin 25.2%
Build foundation in all regions
Success
2.5M pairs sold
Year 13
Upgrade product quality
Success
S/Q 8.5-8.6
Grow internet channels
Success
NA 797K
LA 603K
Increase production productivity
Semi-failure
Productivity below target
Maintain private-label margins
Failure
EU/AF negative margin
Lower labor costs
Success
NA labor costs decreased
LA labor costs decreased
Year 14
Increase profitability
Success
Net profit $191.2M
Stable pricing
Failure
EU/AF prices declined
Improve wholesale margins
Success
Above 23.9%
Grow wholesale volume
Success
13.7M pairs sold
Maintain image rating
Success
Rating 100
Year 15
Maintain profitability & EPS
Success
Net profit $245.6M
EPS $13.06
Expand wholesale segment
Success
17.5M wholesale pairs sold
Control costs in AP & NA
Success
Reduced cost per pair
Focus on Latin America
Success
Revenue increased to $441.6M
Maintain internet market share
Failure
Slight decline
Areas of Success
Wholesale market share
Stable around 10-12%
Brand reputation
Image rating 100
Strong S/Q ratings
Highest since Year 11
Wholesale volume
1st or 2nd highest
High revenues
Strong margins
High cash on hand
Reduced need for loans
Ranked #1 overall
Strong operating margins
Strong shareholder performance
Areas of Failure
High operating costs
Weak private-label performance
Highest liabilities
Low internet segment margins
Demand prediction issues
Industry oversupply
Limited premium materials usage
Key Operations Issues
Unresolved Issues
Lower production costs
Increase margin per shoe
Increase pairs demanded
Increase internet market share
Failure in private label
Resolved Issues
Improve S/Q rating
Lower reject rates
Machinery depreciation improvements
Production & HR Problems
Reject rate AP 5.6%
Reject rate NA 4.3%
NA below average productivity
High cost per pair sold
Productivity below target
Labor cost management
Financial Performance
Year 11 KPIs
EPS $5.23
ROE 39.9%
Stock Price $146.58
Credit Rating A
Image Rating 97
Year 15 KPIs
EPS $13.06
ROE 36.7%
Stock Price $343.49
Credit Rating A-
Image Rating 100
Market Performance
Revenue high and positive
Position #1 overall
High profits
Strong marketing demand
Market share 10.5%
High wholesale demand
Lessons Learned
Loans helped expansion
Communication improves scores
Consistency is key
High production volume works
Lower costs increase margins
Incentive pay may be necessary later
Capital structure matters
Future Expectations (Year 20)
Zero debt remaining
Maintain high S/Q rating
Large cash reserves
Continue fighting for market share
Handle future operational problems
Next Steps
Continue increasing production
Find weaknesses in operations
Pay off debt
Explore celebrity endorsements
Expand into additional regions