Classic Knitwear and Guardian
A perfect fit?
1. Evaluate the product-company fit?
Product Company Fit
The product offered gross margin 38~39% which would enhance the margins of Classic
Knitwear from 18% which was substantially lower compared to industrialstandards.
Guardian brand had high level of awareness and it had patented insect-repellantclothing
technology. The product had a good market potential due to itsinnovativeness. This
advantage can be leveraged by the production efficiency of the company to achieve a
sustainable competitive advantage.
The company had a moderate cost advantage over other US producers due tohigh-volume,
low SKU production runs. The addition of the new product meantaddition of 16 SKUs.
This new product might lead to some inefficiency in its present system.
2. Evaluate the product-market fit?
Product Market Fit
Classic Knitwear operated in $24.5 billion category of non-fashion casualknitwear.
The branded side of non-fashion knitwear market was dominated by three
largemanufacturers: JamesBrands ($4.5 billion), FlowerKnit ($1.25 billion) andGreenville
Corporation ($0.63 billion). These big brands operated on grossmargin of around 30-40%.
In unbranded segment, Classic competed with little known firms like B&BActivewear
which held market share of 23.6% and the “Big Three” were alsoinvolved in this market.
There was a customer need for protection against the rising insect-borne illnessand the
customers were dissatisfied with few prevention products available in themarket. The
category is virtually non-existent in the mass market as the present players in the insect
repellant clothing only sold in niche markets.
3. Will consumers and the trade respond to the Guardian marketing program?
