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Gold Toe Case

After a careful examination of the available company material and wider market analysis, we believe a new, more modern distribution strategy is indeed warranted. The report assumes a desire by Great American to not only maintain current growth rates, but also take advantage of other market opportunities to expand even further. In fact, we believe that without taking such measures, the current rate of growth and percent of market share may in fact decline. Below we outline both the evidence behind this conclusion (part one) and give specific recommendations for a new strategic direction (part two).
Part One
The following section outlines the major reasons (from broad to specific) along with the key supporting facts that support updating the distribution strategy for the Gold Toe brand.
False Assumptions
Moving successfully into the future requires a firm understanding of the past. Our analysis of the forces at play within the current strategy revealed several assumptions that lack supportive evidence.
i. The current strategy is fundamental to the business. There appears to be a belief that the current distribution system was a strategic decision based on a long term company vision or mission. In fact, the decision was made early after the acquisition due to “poor financial performance” and reflected a temporal response to simplify the business and build brand recognition.
ii. The current strategy has resulted in great relationships with our customers (B2B). It is true Gold Toe management has built great relationships with the department stores, but this is more likely multilateral, including good customer service & quality merchandise. There is no reason to believe that alternative strategies would not have resulted in similarly positive relationships.
iii. The current strategy cannot allow for non-exclusivity. This appears to be one of the fundamental arguments against expansion, yet when market overlap has occurred, forcing some non-exclusivity in...