North Face 2000 Annual Report Download - page 5

3
brand successfully maintained its position as the
leading U.S. daypack, while Jantzen swimwear
energized its products with new colors and styles.
Extending our reach. VF was active on the
acquisition front in 2000, adding a number of
brands that extend our reach to consumers both
in the U.S. and internationally. During the year
we acquired three jeans brands. Chic and Gitano
are well-known brands sold in mass merchandise
stores in the U.S.; H.I.S is a leading jeans brand
in Germany. We also purchased Eastpak, a top
supplier of daypacks sold in the U.S. and abroad.
Particularly exciting for us is the acquisition of
The North Face, Inc., which makes high
performance outdoor apparel and other products
for accomplished climbers, mountaineers,
extreme skiers and explorers. In addition to
opening up new product categories and retail
channels for VF, the extraordinary strength of
The North Face brand offers excellent opportu-
nities for future growth.
Managing the business. Managing a portfolio of
global brands is a dynamic process. In 2000 we
made changes to strengthen our organization with
the formation of three new coalitions, or business
groups: Global Intimates, Imagewear and Outdoor.
Global Intimates now includes both our domestic
and our international intimate apparel brands.
Our new Imagewear coalition brings together our
knitwear and workwear businesses and creates
a powerhouse provider of casual, customized
work apparel. Our Outdoor coalition is comprised
of our JanSport, Eastpak and The North Face
businesses offering these strong brands the
chance to benefit from one another’s operational,
product development and manufacturing expertise.
VF’s coalitions now include North & South
America Jeanswear, Playwear, Global Intimates,
Imagewear, International Jeanswear and Outdoor.
Beginning on page 4, the leaders of these businesses
offer their perspectives.
Managing our company for the long-term
also requires the flexibility to add and divest busi-
nesses as markets change. In 2000, we decided
to exit several unprofitable workwear businesses.
Workwear was our most challenging business in
2000. Having acquired four companies since late
1998, the process of consolidating systems, facilities
and product categories in many different locations
took its toll on sales and profits in 2000. Corrective
actions taken in 2000 should result in a substantial
improvement in profitability in 2001.
We also adopted a new strategy for our
Wrangler brand in Japan, transferring the business
to a licensee. This move also unites the manage-
ment of our Lee and Wrangler brands in Japan
under a single entity.
Building a competitive advantage. VF prides itself
on being ahead of the curve in identifying and
applying new technologies that will enhance our
ability to respond quickly to the fast-changing
needs of our customers and consumers. It’s an
integral part of our core strategy of “consumer-
ization.” For several years now, we have been
working on building and implementing new
systems and processes across our businesses. One
key initiative is our retail floor space management
program. Working with our retail partners to
customize product assortments for their stores is
enabling us to grow our sales while managing
our inventories much more efficiently. We also
added new tools to enhance our planning and
forecasting capabilities in 2000. In 2001, we will
focus our energies and resources on implement-
ing VF’s full suite of common systems in our VF
intimates business.
Clearly, there’s a lot going on at VF. We’re
taking action to build future shareholder value with
an impressive array of tools to help us get the job
done: powerful brands that consumers know and
trust, products that offer great value in every
channel of retail distribution and new capabilities
in systems and technology. Most importantly, at
the core of our success is an experienced manage-
ment team committed to success and 75,000
dedicated employees around the world.
Mackey J. McDonald
Chairman, President and
Chief Executive Officer