Louis Vuitton Value Chain

Topics: LVMH, Louis Vuitton, Supply chain Pages: 10 (3243 words) Published: June 5, 2013
Project title: Louis Vuitton Value Chain
Case 2

Class : CL- mec-yf 13

Student: George Dulvara

Number of characters (including spaces, footnotes, end notes and text boxes): 16947

Date: 16/04/2013

Signature

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Table of Contents
Summary2
Introduction3
Motivation3
Research question3
Interpretation3
Scope3
Method3
Analysis of Louis Vuitton Value Chain4
Louis Vuitton Supply Chain4
Value Chain5
LEAN MANAGEMENT6
Future development of the value chain7
Strengths7
Weaknesses7
VRIN Framework8
Conclusion9
Bibliography10

Summary

This case should demonstrate the value that is being added to Louis Vuitton fashion and leather goods chain. We have used several analysis within the case.
We have started with the management of the supply chain in order to see how the production lines are working within the 7 factories of Louis Vuitton for leather goods, starting from the suppliers, distributors and the final area in the official shops.

Michael Porter’s value chain entitle the fact of a completely controlled area even from the beginning due to the fact that the suppliers are under Louis Vuitton administration and distributors like Kuehne + Nagel Japan are having strictly and confidential agreements in order to take care of the worldwide distribution for Louis Vuitton.

New development has been brought to the 7 factories, using the Toyota car maker example, they have implemented the lean management principle within the primary activities to reduce cost and gain efficiency for satisfying the customer needs.

Being one of the most legendary fashion house there are solid strength like skilled handwork and exquisite materials, powerful distribution capabilities and Marc Jacobs as artistic director draw the crown for the biggest luxury brand in fashion and leather goods. Weaknesses like the brand availability only in its exclusive stores and limited number of customers from elite and rich people can lead on short and long term to financial lost in revenues and brand image damaged.

The VRIN Framework lead us to the identification of the core competencies like Product and Service quality, Innovation and Handwork Skills Development.

Introduction

We have made an introduction for the Louis Vuitton value chain.

Motivation

We have been given this case in order to be solved and we have chosen to take a look on the Louis Vuitton value chain. Due to the fact that Louis Vuitton is the biggest luxury brand we want to show from where and how the high value for customers is being brought in the leather products to satisfy the sense of luxury for consumers.

Research question

How is value added to the fashion and leather goods chain? 1. How does Louis Vuitton achieve value in relation with suppliers and distributors?

2. How does Louis Vuitton satisfy the customer needs within its value chain? Interpretation

In our research question, value means the quality of handmade products, manufacturing time, safety and faster distribution to the shops, which is the most important and provide luxurious sense for the customer. Scope

We are focusing on the global fashion and leather goods value chain within Louis Vuitton. Method

We have used several analysis, starting with the supply chain management of Louis Vuitton, Michael Porter’s Value chain and an identification of Louis Vuitton core competencies within VRIN framework.

Analysis of Louis Vuitton Value Chain

Louis Vuitton Supply Chain

Louis Vuitton is a French fashion house established in 1854 by Louis Vuitton, based on luxury goods. Nowadays it’s part of Louis Vuitton – Moët Hennessy Group and is one of the world’s most famous fashion brands. Louis Vuitton is the leading brand in Fashion and Leather goods. Louis Vuitton has 7 factories based on Europe and US dedicated for the production of leather goods within the focal company. There is one factory...

Bibliography: Mahbubani, M.(2013)”Louis Vuitton” Richard Ivey School of Business
Henriette Bjerreskov Dinitzen and Dorthe Bohlbro, “Value-Added Logistics in Supply Chain Management”, Academica
[ 8 ]. Mahbubani, M.(2013)”Louis Vuitton” Richard Ivey School of Business. 15.04.2013
[ 9 ]
[ 12 ]. Mahbubani, M.(2013)”Louis Vuitton” Richard Ivey School of Business. 15.04.2013
[ 13 ]
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