Alligator, I nc. i s a s hoe d esigner, m anufacturer, a nd di stributor t hat l aunched i ts businessÂ in 2012. A lthough t he c ompany o perates g lobally, i ts h eadquarters l ocation is in A rteixo, G alicia, S pain, w hich c oincidentally i s t he c entral l ocation f or Z ara, t he flagshipÂ chain s tore o f t he I nditex g roup, t he w orldâ€™s l argest a pparel r etailer. The b estselling brand of Alligator, Inc. is its GatorsTM model, which is a market leader in the funky, brightly-colored, lightweight s hoe m arket t hat h as e njoyed un expectedly h igh d emand in recent years. Made of a highly-resilient, space-age plastics material, GatorsTM success is related a lso to t he f act t hat e ach p air includes â€œone-size á¼€ ts a llâ€ orthotics to meet t he needs of individual c onsumers. A lligator, Inc. h as p atented t he processes relating to t he manufacture of theÂ orthotics, and the overall value of this product innovation is similar to the way in whichÂ the super-secret formula for Coke is valuable to Coca-Cola, Inc.
The A lligator s upply c hain b egins w ith r etail c onsumers w ho a re l ocated in r egions throughout the world. The GatorsTM product is available for consumers at a wide variety of department stores, airport kiosks, Internet, and a select number of Alligator stores located primarily in developed countries. In addition to proprietary manufacturing facilities in Spain, GatorsTM are produced by contract manufacturers in t he Shenzhen area of C hina andÂ in Brasilia, Brazil. G enerally, t he m anufacturing c osts p er un it were l ower in S henzhen a nd B rasilia, a nd s omewhat h igher in S pain. C onversely, t he q uality o f GatorsTM manufactured in S pain wa s c onsiderably b etter t han t hat o f t he o ther l ocations. The marketsÂ served by the respective manufacturing facilities were those that were in greatest proximity.
The s upply s ide of t he G atorsTM s upply c hain wa s a li ttle m ore c omplicated, a s m ost inputs to the á¼€nished product were available from suppliers in t he regional markets, but the custom-á¼€t orthotics were all produced in University Park, PA in the United States. This is because the developers of the orthotics technology were professors in the supply chain and information systems and footwear technology departments at Penn State University. Overall, A lligatorâ€™s r elationships w ith i ts s uppliers c ould h ave b eneá¼€ted f rom b etter coordination, and more timely and complete exchanges of information. At the time that this case study was published, Alligator was in t he process of designing an IT c apability that would capture point-of-sale information, for further use in streamlining and aligning supply chain operations. A lso, t he s ales of G atorsTM e xhibited s easonal variation, but to some extent seasonal sales in the southern hemisphere complemented sales in the northern hemisphere.
To h elp a ddress s ome o f t he s upply c hain i ssues f acing A lligator, B ryson W ilde h as recently been hired as the new SVP Supply Chain, and Molly Walters has been selected as the á¼€rst chief information officer for Alligator. Collectively, and with the help of consultant Anna Walters, this group has taken time so far to visit the companyâ€™s global facilities and to become aware of the situation, problems, and concerns that are faced by Alligator, Inc. with regard to the GatorsTM product. The following are some of the questions that will need to be addressed by this group.
Based on your knowledge of the global business environment and the positioning of Alligator with regard to its markets and supply sources, what do you think are some of the major global issues that will be relevant to the area of strategic sourcing?