CASE: Timberlake Global

In September of 2012, Lita Mathews, Vice President of Supply Chain for Timberlake Global was
faced with some major decisions. Timberlake Global, one of the world’s largest outdoor apparel
companies, was coming under fire for supply chain issues. They sold their branded products in
their own line of retail stores as well as a variety of other retailers and also had extensive online
coverage globally. Timberlake, a mainstay in European based outdoor fashion, was beginning to
experience supply chain inefficiencies and high-risk scenarios making them falter as one of the
premier outdoor apparel brands in Europe.

Prior to 2008, Timberlake had long committed to a classic seasonal sales cycle where they
introduced new trends four times a year. The trends aligned with Winter, Spring, Summer, and
Fall seasons. Towards the end of a season, the company would mark down that seasonal
clothing to sell excess inventory. The manufacturing of a majority of their products was Europe
based. They proudly partnered with 75 European based contract manufacturers with whom
they had been working with for many years and had negotiated long term contracts.

However, in the mid 2000s, Timberlake saw some of its younger customers being attracted
away to competitors that were based on a fast fashion style model. These companies did not
align with the traditional seasonal sales cycle and instead tested new styles frequently on the
market. They were constantly refining their offerings based on what sold well in test markets
that were based on regional weather forecasts, current events, and actions of popular media
figures. Furthermore, these fast fashion competitors were offering their products at very low
prices.

In an attempt to regain some of their lost market share, Timberlake decided to transition their
seasonal sales model to align more closely with its fast fashion counterparts and release new
clothing trends 10 times a year, increasing their annual product offerings from 50 different
products to 200. This frequent release of new products forced them to outsource their
manufacturing from their Europe based suppliers to lower cost suppliers in other countries with
a quicker turnaround as well as enable them to offer more competitive prices. They
transitioned these suppliers to short term contracts to allow them to be flexible. These
payment terms allowed them to respond quickly to changes in exchange rates, tariffs, and
other cost factors. It also allowed them to manage volumes and keep inventory low. They also
significantly increased the number of manufacturers they were contracting to allow them
flexibility and speed, sourcing from 250 different contract manufacturers across the globe.

Despite an initial boost in customers in the first three years of their adopted fast fashion model,
Timberlake began seeing cracks in the strategy in 2011. Their management of new product lines
was often misaligned with consumer demand and they frequently experienced stock-outs in
popular styles as well as inventory surplus for styles that fell flat. In an attempt to keep their
supply chain agile to meet their new focus on trends, their loose relationships with the
suppliers were causing problems. Some suppliers were not meeting the production timelines of
their most popular products, leading to further supply disruptions and loss of sales. In addition,
several of their suppliers were implicated as having extensive human rights violations, which
was leading to bad press for Timberlake.

Their formerly “simple supply chain” had become increasingly complex. For instance, their
formerly US produced flagship bomber jacket with wool sourced exclusively from New Zealand
was now being produced with materials coming from Uruguay, Turkey, and Argentina. The wool
was spun into yarn in China and sent to Australia for dying and knitting into fabric panels, and
then it was eventually assembled in Vietnam for final production. The company had limited
visibility in the supply chain of its flagship product and they were losing quality and control as a
result. This was just an example of the spiral of impacts their new strategy had generated with
only a marginal increase in market share.

With increasing frequency of stockouts of some products, surplus inventory of others,

increasing supplier issues, and CSR violations looming in their supply chain, Lita Matthews was
under pressure to revisit Timberlake’s strategy. Should they double down on their fast fashion
model? or should she advocate for a return to their former roots of domestic production with
seasonal sales cycle? or somewhere in between? Before she could present anything to her CEO
and Board, she needed to understand what was driving complexity in her supply chain and how
she could better understand how the existing supply chain strategy was creating problems for
the company.