1. The world economy survives on consumerism, but in pursuit of profitability clothing industries are expected to uphold certain ethical values and conduct all their activities in a socially responsible manner. As far as sustainability is concerned, the clothing industries that have been in business the longest seem to model the production of quality goods using innovation but at the same time practicing limited growth. The key role of using innovation is production by using cleaner, more efficient and technology and replacing old pollutant ones. This results in products that may be recycled reducing wastage. This coupled with responsible consumerism will ensure the profitability of the organizations while upholding their ethical and societal obligations. The obligations include ensuring environmental mindfulness in their production methods, the sophistication of healthy communities and consequential work. This also means that the industry has to spend and grow within its limits to reduce layoffs.
2. Several global risks may come into play and affect the outdoor clothing industries, ranging from economic to environmental factors. One of the economic factors is the volatility in energy prices. Energy prices may affect the production of outdoor wear and may even force the manufacturers to opt for cheaper material to offset the energy cost, which may mean environmentally hazardous methods or products. Another risk is the recurring shortage of financial resources from financial institutions, and this is a concern seeing how many industries are constantly spending beyond their means and are, therefore, faced with the threat of selling. This also brings with it the inability to manage inflation in relation to prices and wages which necessitates laying off of workers. Perhaps the largest concern is the failure to adapt to changing climate conditions which necessitate the enactment of restrictive measures. These have, however, not been effected by governments and the industries although Patagonia is pioneering in this field (like the replacement of the neoprene with 60% renewable rubber material in the production of their wetsuits).
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3. Patagonia is a social enterprise as it is a profit organization and it still has specific social objectives that require it to realize profit without compromising on their environment conservation stance. It is registered as a benefit corporation meaning its activities were founded on the interests of its workers, the community and the environment. Patagonia seeks to reduce adverse environmental effects and damage to the planet caused by their individual products while at the same time increasing the mark of the company as a whole. Aside from allocating 1% of all sales to environment preservation ventures, Patagonia, through the holding company Patagonia works, started Patagonia Inc. It was dedicated to using business to tackle environment crisis issues. This instantiated an investment fund that supported start-ups in apparels, environment conservation and waste industries that shared their principles and that may at one time in the future affiliate join with them. Alongside the production of apparel, the president has also initiated production of food substances, described as food products that were responsibly caught or planted, examples being smoked salmon. Some of their projects, like their traceable down, have resulted in surcharges that almost double their price against that of their competitors but the values of the company have to be upheld even in the realization of profit.
4. The number of new entrants is directly proportional to the perceived ease of entering the market. The outdoor wear industry is attractive in terms of starting cost since the product need not be as costly as already established industries such as Patagonia. Cheaper cost of production means cheaper goods that cater for the consumers that may not be comfortable with the prices of established industries and thus form brand loyalty. This may, however, be affected if the government or the industry policies which require the prioritization of the environmental effect of the product and the methods which may, in turn, hike the capital and make the industry spend beyond its means thus discouraging entry.
The threat of substitutes for outdoor clothing industry is fairly low. This is because, despite the glaring difference in price for the apparel, the functionality of the product is what attracts the customers. The competition is, however, still looming and even the already established companies are keen on increasing the multi-functionality of the products so as to increase value and price performance.
The bargaining power for customers is low in the outdoor clothing industry. The number of buyers far outweighs the number of sellers, and with the buyers relating to the values of the industries, buyer information is present to both parties. As a result of this price, sensitivity is not an issue due to the policies put in place by the industry which are also shared by both parties.
The bargaining power of suppliers varies according to the policies practiced by the various participants in the industry. Overall, the supplier bargaining power is low since the resources provided are common and have substitutes. The industries in this field are also well established and as such switching costs are low. They are, however, large in number and this gives considerable bargaining power to suppliers.
The most crucial of the Forces of the Framework is the level of the competitor's rivalry, which takes the form of price vs non-price rivalry. An example is Patagonia, which is known for refusing to compromise on the quality and the price of their goods, so their competition is primarily non-price. Outdoor clothing industry, therefore, requires that the competition takes the form of branding, aggressive advertising and superior customer service alongside innovation. The market has a high entry barrier with a few large competitors. Outdoor apparel consumers are, however, divided by company values with some claiming organizations implement reverse psychology and manipulation tactics to realize their profits while other believing in their company's values and as such are loyal customers.
All dynamics of Porter's Forces considered, the outdoor apparel industry is attractive.
5. Patagonia collaborations are numerous with various end goals in mind. Patagonia is not only focused on reducing damage, but it is also regenerative. They partnered with Nature Conservancy to aid in the regeneration of grasslands in Argentina to counter the effects of overgrazing. Another example would be the use of artisans to use recycled material to make higher quality products. Patagonia's space of opportunity would be the conservation of the environment while still producing quality, top-notch goods. Its president hopes he can get other players in the industry to follow suit and adopt their mantra of quality while exercising responsibility. It also constantly communicates with the customers on matters regarding the policies and the production of goods, mainly through advertisements and contributions by experts while seeking solutions for innovations.
6. Patagonia has fully implemented the Open-System Value Chain in the delivery of its products which ensures more sustainability to the stakeholders, and the encompassing of its moral and ethical values. This has been both in the tangible and non-tangible goods it provides. Using its customer interactions mechanisms, Patagonia uses feedback from to decide on the course of action. It uses the opinions and thoughts from critical thinkers and customers and to seek different approaches that may be taken as challenges to better their techniques and lessen the damage caused in the production. One of their key campaigns, recycling, also primarily revolves around the open-system value chain where the customers' feedbacks are key for its actualization. A physical substitute to this has been the implementation of the reuse strategy. Customers were urged to present old items that were instead sold at the worn wear section of the store's outlets, in exchange for store credit. In this manner the new market was achieved (in the form of younger or varying socio-economic class) and as a result of customer activity.
7. Patagonia adds stakeholders' value through eco-efficiency in a number of ways. The World Economic Forum identified irremediable pollution as one of the global risks. Patagonia is keen on seeking newer technology that is environmentally friendly in the production of its clothing, an example being the 60% natural rubber swimsuit. They are active in advocating for reusing worn clothes since the production effects on the environment have already been incurred and disposal would therefore prove wasteful. They are also known for encouraging customers to only buy merchandise that they need. If fewer products are made, it means less precious resources, like water, get used and also less harmful chemicals which result in less toxic waste being produced. Depletion of oceans and pollution of water also have had their respective campaigns to ensure sustainability for future generations.
8. Patagonia adds stakeholder's value through Socio-efficiency mainly through its environmental and social commitments that call for the allocation of a percentage of the total profits for environmental grants. The investment fund, "$20 Million and Change", was also initiated to support startups in clothing, energy, waste and environmental conservation that shared the principles upon which Patagonia is based on. Patagonia's ‘Patagonia Provisions' began selling smoked salmon in its stores, alongside a fruit bar and buffalo jerky. This was for the provision of food substances that were responsibly caught, planted or harvested. Patagonia is also partnering with Fair Trade USA that ensures workers in the organization are paid fair wages and work in suitable conditions ( Rothaermel, 2015) .
References
Rothaermel, F. T. (2015). Strategic management . McGraw-Hill Education,
