North Face 2000 Annual Report Download - page 9

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Our Lee program also made gains.
We’ve taken our expertise in knit tops
and added to that our strength in jeans-
wear to develop a successful infant and
toddler business. We saw growth in
both our tops and bottoms businesses,
especially for two- to four-year olds.
An Eye on the Bottom Line
We’ve really improved our profitability
over the last several years. In addition to
exiting some mass market business that
was hurting our margins, we’ve improved
our manufacturing costs by expanding
lower cost offshore sourcing.
While still only a small part of
our business, we also are pleased with
the progress of our Internet initiatives.
About half of our smaller customer
accounts now work with us via our
business-to-business web site. And
traffic continues to build at our
business-to-consumer web site at
www.healthtex.com.
With our brands and cost structure
both in good shape today, you can be
sure we’ll be looking for ways to bring
our Playwear business to the next level
by adding new brands and channels
of distribution.
We’re proud of being a lean, mean
fighting machine. Despite retail chal-
lenges in 2000, we grew our business,
cut costs and got well-styled, great
value products to market – all of
which improved our profitability.
The market for children’s apparel
is very fragmented, with most brands
having market shares in the low single-
digits. Private label products dominate,
but the Healthtex, Nike and Lee trade-
marks are important to consumers
seeking brands they know and trust.
We’ve continued to extend the
reach of our Healthtex brand through
Little Impressions®, a moderate to
middle/upper tier line of clothing for
infants. Capitalizing on the success
of the line, we’ve added the Baby
Healthtex®line for middle market stores.
Implementing Successful Strategies
Our licensed Nike business grew
rapidly in 2000. Strategies put in place
during the prior year set the stage for
getting the right age-appropriate,
athletically styled apparel to consumers
shopping in middle market, department
and sports apparel stores. Implementation
of our “key item replenishment”
program, which ensures retailers get a
steady supply of our best selling items,
also supported our growth.
Recently we extended our Nike
license to include a new Michael Jordan
line for boys sizes two to seven, and
we’re looking forward to building this
business in 2001 and beyond.
Healthtex
Lee Infant & Toddler
Nike Kids*
*Licensed
John Schamberger
VP and Chairman –
Playwear Coalition
“Playwear
has what today’s kids want.”