Value Chain Analysis of Patagonia

Patagonia is the world’s leading outdoor recreation apparel and clothing company. Yvon Chouinard founded the recreation and clothing brand in 1973. Today, we’ll discuss the value chain analysis of Patagonia supply chain analysis; primary and supporting activities in the process of value chain analysis Example Company. They are inbound and outbound logistics, operations, marketing, and customer service; infrastructure, HRM, technology, and procurement as an application of the value chain analysis process.

Suppliers and Vendors of Patagonia

• Youngone, Bangladesh
• Chenfeng Factory, China
• Supertex, Columbia
• Supertex, El Salvador
• Honrich Knitwear Factory, Hong Kong
• Trident, India
• Vertical Knits, Mexico
• Formosa, Nicaragua
• Hidaramani, Sri Lanka
• Sheico, Thailand
• Suay Sew Shop, USA
• Yee Tung, Vietnam

The Value chain analysis of Patagonia supply chain analysis would analyze the primary and supporting activities in the process of value chain analysis. They’re inbound and outbound logistics, operations, marketing, and services; infrastructure, HRM, technology, and procurement. Here’s the supply chain analysis of Patagonia value chain analysis company example as follows;

Value Chain Analysis of Patagonia

Let’s discuss the primary and supporting activities involved in the process of value chain analysis of Patagonia supply chain analysis. It is an application of value chain analysis based on Porter’s model; some of the key elements and components of value chain analysis are as follows;

Primary Activities of Patagonia

The primary activities are directly involved in the production of products and goods and adding value to the recreational clothing company. Some of the five main primary activities in the value chain analysis of Patagonia supply chain analysis are as follows;

Inbound Logistics of Patagonia

I-Large Suppliers Network 

Patagonia has established a very large suppliers network comprising approximately 45 suppliers. They’re in 14 countries like Sri Lanka, India, Bangladesh, China, Thailand, Vietnam, Hong Kong, El Salvador, and others. The large and diverse suppliers network helps the company to ensure the smooth supply of raw supplies and materials for production without any disruptions and delays. 

II-Responsible Supply Chain 

The focus of Patagonia is a responsible and transparent supply chain with the objective of decreasing the environmental impact through its efficient production and manufacturing processes. The company implements various sustainability initiatives in various areas; 

• Air emission 
• Waste management 
• Greenhouse gases 
• Energy usage 
• Water emission 
• Water usage 
• Chemicals 
• Environmental management system 

III-Suppliers Analysis 

Patagonia regularly evaluates its supplier’s network to ensure their compliance with the company’s environmental standards, regulations, and performance. Integrating the supplier’s evaluation process allows the company to make effective supply chain decisions. For instance, the company is currently using raw materials and supplies that focus on decarburization to decrease the carbon emission rate.  

Outbound Logistics of Patagonia

I-Transportation & Distribution Channels 

Patagonia employs various transportation channels for the distribution of products and goods. They move raw supplies and materials to the supplier’s manufacturing factories; and then to the distribution centers and retail chain stores. 

II-Efficient Transportation 

Patagonia makes sure that its transportation and shipping channels are efficient with a limited carbon footprint of approximately 10%. In order to decrease the carbon footprint, the company focuses on drop shipping and directly shipping goods to international distribution centers. However, it allows the company to avoid air shipping, limited two-day delivery options, and sustainable transportation. 

Operations of Patagonia

I-Production & Manufacturing Factories 

Patagonia has approximately 61 production and manufacturing factories in 14 countries across the world. The company outsources almost all of its production and manufacturing operations. However, the company makes sure that its production and manufacturing factories are complying with environmentally sustainable standards and requirements. 

II-Distribution Centers 

Patagonia has two international distribution centers and 70 retail chain stores across the world. The distribution centers receive finished goods directly from the production and manufacturing factories. They temporarily store, organize, and package the goods, and then ship them to the required and partnered retail stores. 

Marketing & Sales of Patagonia

I-Marketing & Advertisement Campaign 

Patagonia runs innovative and surprising marketing and advertisement campaigns for the promotion of environmental sustainability, products, and brands. The company employs various media channels, social media platforms, digital media, billboards, TV, and print media to approach the end consumers and promote its products there. 

However, the company requests its customers to repair the damaged goods, and buy the recycled products rather than buying the new ones. The objective of such campaigns is to promote environmental waste consciousness. 

II-Retail Chain Stores 

Patagonia has a network of approximately 70 retail chain branded stores in 10 countries across the world. They offer high-quality, used, and recycled products to the customers; it focuses on connecting with connecting customers and promoting environmental sustainability. 

Services of Patagonia

Patagonia offers a wide range of services to customers along with physical products. The additional service portfolio helps the company to improve the overall customer satisfaction level. However, some of the main services are as follows; 

• Recycling 
• Repairing and maintenance 
• Promoting environmental sustainability trends 

Supporting Activities of Patagonia

Supporting activities are indirectly involved in the production of products and goods and adding value to the recreational clothing and Apparel Company. Some of the main supporting activities in the value chain analysis of Patagonia supply chain analysis are as follows;

Infrastructure of Patagonia

Patagonia has established a very large infrastructure of production and manufacturing, a sustainable suppliers network, retail stores, distribution channels, and others. Well-developed infrastructure helps the company to smoothly perform its various sustainable production operations and timely deliver the finished goods to the end consumers. 

HRM of Patagonia

Patagonia has employed approximately 3000 employees to manage its global operations. The human resource management department of the company plays a key role in building a large suppliers network; promoting environmental sustainability, and building effective relationships with multiple stakeholders and partners. 

Technological Development of Patagonia

Patagonia invests a significant amount of capital resources in research and technological development. It allows the company to efficiently source raw materials with limited damage to the environment; and decrease the wastage of resources with efficient methods of production. In short, research and technological development help the company to achieve efficiency with limited impact on the environment. 

Procurement of Patagonia

Patagonia is highly careful about ethical sourcing and procurement of raw materials, supplies, and resources for production and manufacturing. The company has set up a strict code of conduct and regulations for suppliers to ensure their compliance with human rights and environmental standards and requirements. 

Conclusion: Patagonia Value Chain Analysis Example Company | Application of Value Chain Analysis Process 

After an in-depth study of the value chain analysis of Patagonia; we have realized that Patagonia is the world’s leading retail chain brand. If you are learning about the Patagonia value chain analysis example company; then you should keep in mind the abovementioned primary and supporting activities. They’re inbound and outbound logistics; operations, marketing and sales, and services; infrastructure, procurement, HRM, and technological development as an application of the value chain analysis process.