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Lands End Ms

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Submitted By asilia
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Lands' End –Case

Based on article of Communication of the Association for Information Systems

Blake Ives, Gabriele Piccoli:

“Custom Made Apparel and Individualized Service at Lands' End”

1. Estimate the impact of custom-tailoring compared to in-store purchases of ready-to-wear on the following cost factors: equipment, labor, inventory, shipping, and advertising. Estimate the impact of each, on overall costs, on a really rough range from – 9 to +9, where -9 would be much lower cost in the grand scheme of things, 0 would be the same cost, and +9 would be much higher cost. Add up your estimates and derive a net or total. If the answer does not seem to make sense, make adjustments so that all numbers are on the same scale (impact on total overall costs). Overall, based on this analysis, using another rough value judgment, what do you think Lands' End would be expected to charge for custom tailored clothing as a percent of the cost of ready-to-wear? Explain your answer, again in no more than one paragraph.

Group estimates of different cost factors:

| |-9 |-8 |
|Bargaining power of buyers |L |Customers are being proposed new approach to the tailored clothing – fast, convenient, does not |
| | |require attendance for measuring, certain variety of choices, traditional (immune to changing |
| | |tides of fashion). |
| | |Significant part of customers, 36% are ready to pay extra (12-15%) for custom apparel, so it is |
| | |not under the cost

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