Crocs (A): Revolutionizing an Industry’s Supply Chain Model For Competitive Advantage

Crocs (A): Revolutionizing an Industry’s Supply Chain Model For Competitive Advantage

By
Charles Holloway, David Hoyt, Hau Lee, Michael Marks, Amanda Silverman
2007|Case No.GS57A

This case discusses the astounding growth of Crocs, Inc., a manufacturer of plastic shoes, from 2003 through early 2007. Much of the company’s growth was made possible by a highly flexible supply chain which enabled Crocs to build additional product within the selling season. The normal model used within the fashion industry was to take orders well in advance of each selling season, and produce to those orders, with relatively little additional production. If demand was far in excess of this production, there would be stockouts and the company would lose the ability to capture revenue for that season. The product might, or might not, be in fashion the following year, when production would again be based on pre-season orders.

Crocs’ ability to build additional shoes within the season enabled it to take advantage of strong customer demand, resulting in the company filling in-season orders totaling many times that of the initial pre-booked orders. The case describes the Crocs supply chain. It asks students to assess the company’s core competencies and how those can be exploited in the future.

The case was revised in March 2011 to present information on the company’s results in 2007 and prepare students for discussions of problems would face in 2008 (covered in the B and C cases).

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