VF Corp owns several brands including Timberland

VF Corp owns several brands including Timberland

The CEO of US footwear and apparel giant VF Corp has praised the company's early progress in its five-year plan to revamp its supply chain – a move aimed at accelerating speed-to-market and getting closer to its consumers.

Steven Rendle, CEO of VF Corp, which owns brands including Timberland, Wrangler and The North Face, said that just six months into the first year of the company's 2021 strategy its results are "right in line with our expectations" and "in fact, we're doing so much better than we anticipated." 

Rendle was speaking to investors last week in the wake of the company's second quarter results, which also saw it raise its full-year outlook. The firm reported a net income jump of 115% to $109.9m in the three months to 1 July, up from $51.0m in the same period last year, and a revenue rise of 2% to $2.36bn, from $2.32bn a year earlier. 

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In April this year the company revealed a five-year growth plan to 2021, including a ramped-up focus on its top-performing Vans, Timberland and The North Face brands prompted by "a rapidly changing marketplace".

"As consumer preferences evolve, we need to transform and we need to be able to position ourselves closer to where our consumers are," said Rendle at the time. "We need to pivot and become much more retail- and consumer-centric in how we think, how we act. It will help us to become more agile and quick to adapt to the changing market conditions that we see on a year-to-year basis."

In the company's latest update, Rendle said he was "encouraged by a strong start to 2017" and the company's "improved performance in the face of an unpredictable retail environment."

Addressing questions specifically around how the firm was repositioning itself to get closer to consumers and accelerate its speed-to-market capabilities, Rendle said: "What we're looking at is really the end-to-end process of product creation and everything to do with going to market.

"We've got a number of projects underway with our largest brands, where we're really tearing down the timelines of product creation, as well as manufacturing and looking at where can we take time out, how can we use digital technology to advance our ability to be more agile." 

He added the company is looking at moving away from "this old wholesale model that you've seen so many people do over the years, to being present more often through more thoughtfully merchandised lines." This, he said, is challenging "every aspect" of the product creation cycle.

"Our supply chain is deeply involved in this project and really helping shepherd how our product creation teams are looking at this, and how they can be more integrated in improving our speed to market."

VF Corp also announced it would be investing US$40m in 2017 to accelerate growth as it moves into 2018, with about a quarter of this going toward demand creation within its three big brands in direct-to-consumer and digital.

"We expect that to have an impact this year and into next year, but half is around specific strategic priorities," said Rendle. "Design and innovation, data and analytics, our digital platform, absolutely continuing to move on advanced manufacturing and innovation projects we have in play there; and then talent. Talent really is the great driver for us long-term and we are continuing to look at acquiring as well as developing key talent to help us grow long-term."

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