Sport Obermeyer Ltd

Overview
Founded in 1947 by Kluas Obermeyer in Aspen Colorado Fashion skiwear manufacturer offering a broad line of ski apparels

including parkas, vests, ski suits, shells, ski pants, sweaters, turtlenecks & accessories Estimated Sales of US $ 32.8 million in the year 1992 Market Share 45% Children's Skiwear 11% Adult Skiwear Major Production done in Hong Kong and China by partner company Obersport Ltd. Obersport Ltd. was a joint venture established in 1985 by Kluas Obermeyer & Raymond Tse. Obersports is responsible for the raw material sourcing and production for all Sports Obermeyers products in the Far East

Structure
Ski Retail Stores

Obersport

Sport Obemeyer

Direct Mail Retailers

Departmental Stores

Production Process
Design (Feb 92) Final Design ( Sept 92) Sample Production Full scale production (Feb 93) Las Vegas show( 80% orders) Place final order with Obersport Additional orders received Transport to HO( July 93) Delivery to retailers by Sept 93 Retailers selling from Sept to Feb) Later Discount Sale

The Order Cycle

Design Process Begins 1993-94 Lines Feb 1992 Las Vegas Trade Show Mar 1992 Design Concepts Finalized May 1992 Finalized Sketches sent to Obersport July 1992 Designs Finalized Sep 1992

Initial Production Order to Obersport

Cutting and Sewing Feb 1993

Las Vegas Show 80% orders Mar 1993

Final Production Orders April-May 1993

Challenges to Obermeyer
Long manufacture lead time
No feedback from market until Vegas Trade Improper Forecasts

Issues
How to measure demand uncertainty from forecast
How to allocate production between the factories in

Hong Kong and China.( How much to produce in each Factory)

Production overview
Hong Kong 50% faster then Chinese workers Expensive Faster Flexible
China Cheaper Large Lot size Slower then HKK

The Product
Product were offered in 5 genders( Men, Women,

Boys, Girls & Preschoolers) Segmented according to( Price, Type and Fashion) Customer were divided into ( Fred, Rex, Beige & Klausie)

Suggestions
Ideally, during Speculative Production, we want to order a

specific quantity of a parka style, and then, during Reactive Production, we want to fine tune the parkas remaining supply by ordering as few or However, a large minimum order quantity for a particular style of parka forces us to order either many parkas or none.
Thus, a minimum order quantity significantly reduces the ability

to fine tune during Reactive Production. as many as the indicated by the revised forecast after Las Vegas

Recommendations
Improve the demand forecasts made internally by the Buying

Committee in November just before Speculative Production. Instead of using just a simple average of the individual forecasts made by Laura, Carolyn, Greg, Wendy, Tom, & Wally, use a weighted average, with the weights reflecting past accuracy.
Obtain market feedback earlier than Las Vegas, thereby

converting some Speculative Production to Reactive Production.

Decrease lead times for both raw materials and finished goods,

thereby allowing more time to utilize existing capacity.