Pepe Jeans Case Essay

The main usefulness of Pepe not giveing archive is obviously the represent savings, as it is usually not competent or cost effective for that matter, to carry excess inventory. The downside is not having enough pairs of jeans on hand to ship to stores when demand is high. An inventory would help alleviate this. The six month contribute age is both an expediency and disadvantage for Pepe. The long scarper quantify is positive in that once a seller places an order, they solitary(prenominal) consider a week to cancel the order. Pepe is able to pull ahead a profit after only ten days rather than months later.The train locked retailers in immediately and keeps them from reneging on the deal. The downside is that umteen stores whitethorn be turned run into by the long wizard. It was credit entryed in the condition that to the highest degree manufacturers have lead measure of a few months or less. The autarkical stores also tended to order less slew due to the infle xible order system, and the knock over with fashion is that items typically have a short wearable life to begin with they go pop out of style. Corporate purchasers were discerning that the jeans they ordered may go out of style before they even arrive.If I were the manager of Pepe, I would assure my retail partners that every reasonable action was presently being taken to help shave the current lead time. I would point the options being considered and thank them for their partnership. I would then sit down with the CFO as well as the best analysts in the conjunction and run reports to forecast the most efficient method of reducing lead time. The case mentions two alternatives to reduce lead time working with a Hong Kong sourcing means or building a application operation in the UK.Without seeing the companys financials, it is difficult to say which would be a better choice. The article does mention that Pepe has no long term debt and appears to have plenty of cash on hand. If that is unfeignedly the case, then the better option may be to invest in the end factory. There would be a humongous investment up front, but lead time could be cut in half while reducing cost by up to ten percentage as well. On the other hand, the sourcing agentive role could possibly reduce lead time down to as little as six weeks. The problem with this option is that cost to soar by as more than as thirty percent.