Abercrombie & Fitch SWOT & PESTLE Analysis
COMPANY PROFILE -Abercrombie & Fitch
Business Sector :Apparel Retail
Operating Geography :United States, North America, Global
About Abercrombie & Fitch :
Abercrombie & Fitch is a global specialty retailer of apparel and accessories. It was founded by David T. Abercrombie and Ezra Fitch in 1892. It is headquartered in Ohio, U.S. The Company mainly focuses on casual wear and operates through two other offshoot brands: Abercrombie Kids and Hollister Co. For these 125 years, Abercrombie & Fitch has outfitted innovators, explorers and entrepreneurs. The brand now balances both modernity as well its heritage by reflecting the attitude of modern consumers through expertly crafted products. The company operates through both stores and its own e-commerce. It has more than 850 stores across North America, Europe, Asia and the Middle East as of February 1, 2020 and employs around 44,000 associates.The brand has a commitment to offer products of enduring quality and exceptional comfort that allows consumers around the world to express their own individuality and style. This commitment has remained the USP of the brand and helped satisfy the consumers. Its values are “Commitment to quality”, “Authentic Goodness” and “Always Forward”. It promises the customer that “We will put you at the center of everything we do”, “We will always treat you with respect”, “We will provide you with world class service, quality and value in every interaction - guaranteed” and “We will listen to your input and save you a place around our fire.”
Abercrombie & Fitch Revenue :
$3.62 billion – FY ended 1st February, 2020 (year-on-year growth of 1%)
$3.59 billion – FY ended 1st February, 2019
Competitive Analysis of Abercrombie & Fitch
| Strengths | Weaknesses |
| 1. Digital and omni-channel capabilities 2. Strong customer engagement programs 3. Strong, innovative and unique brand portfolio | 1. Stores dependent on consumer footfall in shopping malls 2. Dependence on a single contract carrier for North America region 3. Reliance on third-parties for manufacturing |
| Opportunities | Threats |
| 1. Estimated growth of global outdoor market 2. Expansion in mainland China and other Asian markets | 1. Impact of COVID-19 outbreak 2. Global apparel industry – an increasingly competitive business 3. Fluctuation in cost and quality of raw materials 4. Impact of China tariffs on sourcing |
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Detailed SWOT Analysis of Abercrombie & Fitch
Strength
1. Digital and omni-channel capabilities: Abercrombie & Fitch has worked towards optimizing its global store network. It has rightsized its store fleet and is adapted to the evolving role of the store due to changing consumer preference. It also tries to create best-in-class experience for the customer which would also increase the profitability across the multiple channels that it operates through. It tries to increase the speed and efficiency of its concept-to-customer product life cycle. It invests in increasing its supply chain capabilities for greater speed and flexibility. Leveraging data and analytics helps the company to offer the right product at the right time in the right place to the customers hence giving them more value and better experience. As of Q2-FY20, the company operates 850 retail stores and has the capability to ship merchandise to roughly 120 countries. The company also recorded digital net sales of over $1 billion in fiscal 2019 and 33% of fiscal 2019 net sales were derived internationally. Mobile engagement has also witnessed a steady growth, with moe than 80% of the apprel retailer’s digital traffic clocked from mobile devices in fiscal 2019. The American retailer continues its strive to enhance and expand mobile capabilities, including seamless checkout processes and smooth navigation of products, to improve the overall mobile experience.
2. Strong customer engagement programs:Abercrombie & Fitch has undertaken multiple initiatives for its transformation. It has improved its customer engagement through its various loyalty programs and market optimization. Using data science, it is now in a better position to leverage data including its multiple loyalty programs. This helps the company to engage with the customers across various channels. This gives the firm a better hand in understanding the customer insights. It also helps in driving more efficient and effective marketing spend. In order to improve customer engagement, it also launched two new offices with regional headquarters in London and Shanghai. Loyalty programs are rolled out in China also. Data analytics has helped in getting useful consumer insights which drive improved responsiveness to customer demands and also introduce additional personalization.
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Weakness
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Opportunity
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Threats
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Major Competitors :
- Aeropostale
- American Eagle Outfitters
- H&M
- Jack Wills
- Gap
- Inditex
Major Brands :
- Abercrombie & Fitch
- Abercrombie Kids
- Hollister Co.
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TABLE OF CONTENTS
DELIVERY AND FORMAT
WHY CHOOSE US?
References used in Abercrombie & Fitch Analysis Report
1 Annual Report 2019 -
https://abercrombieandfitchcompany.gcs-web.com/static-files/26290696-874c-4cad-9c62-98ca22eeef05
2. Abercrombie & Fitch trims forecast as Hollister, international business drag -
https://in.reuters.com/article/abercrombie-results/abercrombie-fitch-trims-forecast
-as-hollister-international-business-drag-idINKBN1Y01K5
3. Abercrombie Races to Reduce China Imports as Trade Tensions Rise -
https://www.bloomberg.com/news/articles/2019-08-29/abercrombie-races-to-
reduce-china-imports-as-trade-tensions-rise
4. A&F Co.’s commitment to managing and reducing waste sent to landfills from our
operations is aligned with UN Sustainable Development Goals 12 and 17.-
https://corporate.abercrombie.com/af-cares/sustainability/environmental/materials-waste
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Abercrombie & Fitch SWOT & PESTLE analysis has been conducted by Sushree Lasyamayee and reviewed by senior analysts from Barakaat Consulting.
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