Tommy Hilfiger's Turnaround Strategy

lternative strategic options for Tommy Hilfiger and propose a turnaround strategy for the first 100 days after the acquisition: Tommy Hilfiger believed that there it was important to sell out huge volumes and thereby make it available to all parts of the U.S. however, on doing so, they had to compromise on quality and moreover was requested to lower the price to a more than affordable level of the existing customers. There was huge line of apparels rolling out but there was no complete demand for the product. Anything that’s available anywhere becomes less attractive and genuine to the consumers. It was actually a bad strategy in the long run. The only savior for Tommy Hilfiger was having its separate line of design and production in Europe

In the current era of fashion, its relatively easy for players to enter into the fashion industry, therefore the entry risk of new competitors is moderate in both US and European markets.

Bargaining power of its suppliers: Bargaining power of suppliers in US is high, but it is moderate in Europe. In the US a high competition gives suppliers power to charge higher prices to Tommy Hilfiger, whereas the competition in Europe is not very high.

Bargaining power of customers The customers have more choices in US industry, therefore in US they have higher bargaining power because Tommy Hilfiger has somewhat lost its reputation in US therefore it has to accept a lower price in the US region. In European region, bargaining power is moderate because of higher brand recognition and reputation of the Tommy’s brand. The customers cannot bargain on the quality of Tommy Hilfiger and its market reputation.

Substitutes

The threat to substitutes in the clothing industry is moderate because the utility nature of the clothes, but the fashion industry has also lower threat because people are willing to wear fashionable clothes in both US and