Sport Obermeyer Ltd is a skiwear manufacturer founded in 1947 that produces a broad line of ski apparel, with estimated sales of $32.8 million in 1992. The company has production facilities in Hong Kong and China through a joint venture partner called Obersport Ltd to handle sourcing and production. The document outlines Sport Obermeyer's production process, challenges, issues, and recommendations to improve demand forecasting and flexibility to better meet orders.

1. Sport Obermeyer Ltd

2. Overview
• Founded in 1947 by Kluas Obermeyer in Aspen Colorado
• Fashion skiwear manufacturer offering a broad line of ski apparels
including parkas, vests, ski suits, shells, ski pants, sweaters, turtlenecks
& accessories
• Estimated Sales of US $ 32.8 million in the year 1992
• Market Share
– 45% Children's Skiwear
– 11% Adult Skiwear
• Major Production done in Hong Kong and China by partner company
Obersport Ltd.
• Obersport Ltd. was a joint venture established in 1985 by Kluas
Obermeyer & Raymond Tse.
• Obersports is responsible for the raw material sourcing and production
for all Sports Obermeyer’s products in the Far East

3. Structure
Ski Retail
Stores
Obersport Direct Mail
Sport Obemeyer
Retailers
Departmental
Stores

4. Production Process
 Design (Feb 92)
 Final Design ( Sept 92)
 Sample Production
 Full scale production (Feb 93)
 Las Vegas show( 80% orders)
 Place final order with Obersport
 Additional orders received
 Transport to HO( July 93)
 Delivery to retailers by Sept 93
 Retailers selling from Sept to Feb)
 Later Discount Sale

5. The Order Cycle
Design Design Finalized
Process Begins Las Vegas Designs
Concepts Sketches sent
Trade Show Finalized
1993-94 Lines Finalized to Obersport
• Feb 1992 • Mar 1992 • May 1992 • July 1992 • Sep 1992
Initial
Final
Production Cutting and Las Vegas Show
Production
Order to Sewing 80% orders
Orders
Obersport
• Feb 1993 • Mar 1993 • April-May 1993

6. Challenges to Obermeyer
 Long manufacture lead time
 No feedback from market until Vegas Trade
 Improper Forecasts

7. Issues
 How to measure demand uncertainty from forecast
 How to allocate production between the factories in
Hong Kong and China.( How much to produce in each
Factory)

8. Production overview
Hong Kong
 50% faster then Chinese workers
 Expensive
 Faster
 Flexible
China
 Cheaper
 Large Lot size
 Slower then HKK

9. The Product
 Product were offered in 5 genders( Men, Women,
Boys, Girls & Preschoolers)
 Segmented according to( Price, Type and Fashion)
 Customer were divided into ( Fred, Rex, Beige &
Klausie)

10. Suggestions
 Ideally, during Speculative Production, we want to order a
specific quantity of a parka style, and then, during Reactive
Production, we want to “fine tune” the parka’s remaining supply
by ordering as few or However, a large minimum order quantity
for a particular style of parka forces us to order either many
parkas or none.
 Thus, a minimum order quantity significantly reduces the ability
to “fine tune” during Reactive Production.
 as many as the indicated by the revised forecast after Las Vegas

11. Recommendations
 Improve the demand forecasts made internally by the Buying
Committee in November just before Speculative Production.
 Instead of using just a simple average of the individual forecasts
made by Laura, Carolyn, Greg, Wendy, Tom, & Wally, use a
weighted average, with the weights reflecting past accuracy.
 Obtain market feedback earlier than Las Vegas, thereby
converting some Speculative Production to Reactive Production.
 Decrease lead times for both raw materials and finished goods,
thereby allowing more time to utilize existing capacity.