Columbia Sportswear Business Intelligence

Company profile: Columbia

Company profile: Columbia Co. Mercyhurst University RIAP Class 300 Pia Frascatore

Fall 2012

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ContentsContents.............................................................................................................. 2 Executive Summary...................................................................................... 5 Value Chain...................................................................................................... 6 Timeline........................................................................................................ 9 Top Management:....................................................................................... 13 Marketing activities and trends................................................................... 20 Marketing:................................................................................................ 20 Trends:....................................................................................................... 22 Operations/Capacities.................................................................................... 23 Strategies....................................................................................................... 27 Coldblack:................................................................................................... 43 Garment......................................................................................................... 44 Layered Thermoplastic Non-Woven Textile Elements................................................ 45 Cellulosic Substrates with reduced absorbent capacity having the capability..................... 46 Temperature responsive smart textile..................................................................... 47 Waterproof moisture-permeable underwear and waterproof moisture-permeable liner ........48 Heat management system................................................................................... 49 Holographic Patterned Heat Management Material.................................................... 50 Zoned Functional Fabrics................................................................................... 51

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EXECUTIVE SUMMARY:Columbia Sportswear is a strong company, attracting audiences to their luxurious products despite tough economic times, reaching record highs in sales i. Their expansion is consistent even in the uncertain economy. Their strong business plan is based on new technology, this innovation requires large investments and thus and large gamble ii, counter acted by out sourcing the responsibility for production and sales to other companies. The structure is further stabilized by the versatile in background and ideas, present on the board of Directors iii. The rising costs of materializes, will soon be squeezing profit margins, and in this changeling field, flexibility will be keyiv.

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Key Intelligence TopicsSources Key Finding Implications for Colombia Sportswear Co.

PRIORITY: A HIGHEST IMPACTStrategy Models

1. Market developmentMarketing and Trends

Redefining the brand through advertising

Strategy Models

2. Market PenetrationMarketing and Trends

Expanding into new markets

Value Chain 3. Innovation & Development Patent analysis Strategy Models

Competing through superior functionality and assessing that strategies profitability in this market.

Financial analysis 4. Stagnant Economic Growth STEEP Sources Key Finding Implications for Colombia Sportswear Co. May cause reduction in sales if prolonged.

PRIORITY: A HIGHEST IMPACT 5. Market development

PRIORITY: A HIGHEST IMPACTStrategy Models Marketing and Trends

PRIORITY: A HIGHEST IMPACT Redefining the brand through advertising

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Company OverviewExecutive SummaryColumbia Sportswear is a strong company, attracting audiences to their luxurious products even in tough economic times, reaching record highs in sales v. Their expansion is consistent even in the uncertain economy. Their strong business plan is based on technology, this innovation is a big investments and thus and large gamblevi. This Risk is countered by the versatile in background and ideas, present on the board of Directorsvii. Rising materializes costs have been seen to problematic for the retail market, this phenomena will soon be effecting Columbias profit margins; in this changeling field, flexibility will be keyviii. 1) Corporate strengths : a) Profitability; as seen in the record high sales of the past two years.(see financial report) b) Diversely of ideas in board; spawned from their diverse backgrounds. (see management assessment) c) Strong leadership; in that the direction of the company is focused on continuing to achieve goals in their current manner (see marketing) d) Diversified market, specialized production; this will attract consumers even as prices rise. (see product portfolio)

2) Corporate weaknesses/potential challenges: a) Future of company very closely tied to the future of the Boyle family. (see management) b) Luxury item, niche market; this is a vulnerability in a changing market. (see product portfolio, and marketing) c) Production outsourced, the changing market may lead to non-absorbable cost increases. (see STEEP) (not held by company)

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Value ChainSummary: Columbia is a truly global company. Their growth is substantial; with strong plans to expand. Their success is based on patents for innovative, functional fabrics and brand loyalty. Most other operations are externalized, and this leads to both high liquidity and vulnerability ixx. Supply Chain: Inbound logistics Accounting:xi Externalized: Deloitte & Touche LLP independent registered public accounting firm for Columbia Sportswear Co.

Production:xii Externalized: Products produced to company specifications by independent manufacturers located in 15 countries. (not US) Vietnam and China accounting for approximately 67% of 2008 apparel production footwear manufactured in three countries, China and Vietnam 99% of 2008 footwear production.

Production:xiii Externalized: Products produced to company specifications by independent manufacturers located in 15 countries. (not US) Vietnam and China accounting for approximately 67% of 2008 apparel production footwear manufactured in three countries, China and Vietnam 99% of

Operations: Employment:xiv December 31: 3,163 full-time employees 1,737 in United States 985 in Asia 5/2/2013 Page 6 of 94

Company profile: Columbia 320 in Europe 121 in Canada. Sales and Marketing: Stores are generally stand alone in larger communities, as opposed to a mall presence. While their locations are international, they are not as numerous as one would expect from such a large brand name.

Their strength is the reach of online retailer: Available in fallowing languages and countries, where customers can directly order

Out bound logistics: 1.48 Billion annual sales 2011xv Profit $77 million, or $2.26 per sharexvi 2009 profit $67 million, or $1.97 per share, $1.2 billion salesxvii Human resources: Employment:xviii December 31: 3,163 full-time employees 1,737 in United States 985 in Asia 320 in Europe 121 in Canada. Infrastructure: Headquarters: 14375 NW Science Park Drive Portland, Oregon 97229-5418 United States Phone: 503-985-4000 Fax: 503-985-5800 5/2/2013 Page 7 of 94 Global Cooperate offices and Distribution Centers: All company holdings and property leases:


History and backgroundSummary: This is operated as a family company, regardless of their public stature. 63% of the company remains with the Boyle founding familyxix. Gertrude Boyle's children may have been presented with executive jobs, somewhat prematurelyxxxxixxiixxiiixxiv. The company has a strong focus on innovation, and this may drive them to out preform, and out sell their competitors. xxv

TimelineApparel Magazine names Columbia as a top innovator US and Canada Columbia sponsored ski teams podium in events around the world

Technologies developed: Omni-Wind BLOCK, Omni-Freeze ICE,

2012

Omni-Wick EVAP

Columbia sponsors the US Frestyle Ski Team The Peak 2 Peak Jacket wins Outside Magazine's Gear of the Year award

2011

Technologies developed: Fluidpost & Fludframe, Insect Blocker, Onmi-Dry Ultrabreathable, Waterproof :OutDry Forbes names Columbia one of the top 100 most trustworthy

2010

Technologies developed: Omni-Heat Thermal Reflective, Omni-Heat Thermal Electric Columbia launches e-commerce

Titanium golf line introduced

Technologies developed: Omni-Shield Advanced Repellency, Omni-

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2009

Shield Blood 'N Guts, Omni-Freeze Advanced Cooling

Omni-Shade Columbia's proprietary sun protection technology developed

2008

Columbia celebrates its 70th anniversary Official Sponsor of Team Columbia, former team High Road Columbia acquires Montrail and Pacific Trail Products Available in 72 countries

2006Gert's autobiography, One Tough Mother, is releasedX Games official supplier 20022005

20054 Star Distribution Center opens Columbia acquires Mountain Hardwear

2004 2003

Company reaches $1 billion dollars in annual sales

Cambrai, France, Distribution Center opens 5+ million visitors to website Salt Lake City Winter Olympic Games: Official supplier to NBC Sports Eco-Challenge official provider 19962002

2002 2000 1998Columbia acquires Sorel Company goes public Sydney Summer Olympic Games: Official supplier to NBC Sports

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Company profile: ColumbiaOmni Dry: High-performance moisture management technology developed

1997

Special Olympics: Official supplier to Team USA Columbia Comfort System introduced

1996 1995

PFG introduced Flagship store opens GRT: Gear for Rugged Trekking and Travel line introduced America's Cup: Official sponsor to America3 Convert and Titanium lines introduced Lillehammer Winter Olympics Games: Official supplier to CBS Sports Rivergate Distribution Center opens

1994 1993 1991 1986 1985Footwear line introduced Omni-Tech: Columbia's proprietary waterproof-breathable technology developed First Bugaboo Parka revolutionizes how downhill skiers dress Sportswear line introduced The Mother of all ad campaigns begins

1984 1982 1975 1970 1960

Youth line introduced

The Columbia Interchange System is introduced in the Quad Parka Columbia first to introduce Gore-Tex parka Company goes international

Gert Boyle, a housewife, takes over the company because of her husbandsdeath at age 47xxvi Gert Boyle designs first fishing vest Columbia Hat Company becomes Columbia Sportswear Company

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1938

Columbia Hat Company established by Gertrude Boyle's parents when they fled Nazi Germany when she was 13.

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Top Management:Columbia holds a very specialized board of directors. The remarkably diverse backgrounds are apparent, an expert for every field; mediated by the family core. Key members of the board are older, but the rage of ages and the seemingly generational set up of power, leads one to believe and change in this structure would not destabilize the company to any great degree. Gertrude Boyle xxviixxviii Chairwoman of the Board Employment: University of Arizona with husband (degree not found/completed) House wife President of her parents' company in 1970 after the death of her 47 year old Husband and her refusal to sell the company for $1,400. Trustee to Lewis and Clark College 1970 - present Chairman of Columbia Sportswear Co. since 1983 Autobiography: One Tough Mother, was published in 2005 Compensation: Salary$842,423 Total Annual Compensation$842,423 All Other Compensation (Stock) $66,601 Total Calculated Compensation$1,375,424 *Data is at least as current as the most recent Definitive Proxy. Timothy P. Boyle xxixxxx President and Chief Executive Officer Employment: The University of Oregon, BS Journalism 1971 General Manager, started to help mother with family company while finishing senior year of college Director of Columbia Sportswear Co. since 1978 president and chief executive officer of Columbia Sportswear Company since 1989 1999-N/A, Director of Widmer Brother Brewing Company Interim Executive Vice President of Global Sales and Marketing since August 2012 Director of Craft Brewers Alliance Inc. since July 1, 2008 Director of Northwest Natural Gas Co. since 2003 Annual Compensation: Salary $859,231 All Other Compensation (Stock)$28,289 Total Calculated Compensation $1,896,110 5/2/2013 Page 12 of 94

Murrey R. Albers xxxixxxii Total Annual Cash Compensation$43,500 Total Calculated Compensation$203,566 Background: President and Chief Executive Officer of United States Bakery,1985 General Manager of Franz Bakery,1975 Independent Director of Columbia Sportswear Company since July 1993. Stephen E. Babson J.D. xxxiiixxxiv Employment: Board of Directors since July 2002 chairs the Nominating and Corporate Governance Committee Managing director in Endeavour Capital, a Northwest private equity firm, since April 2002. Attorney at Stoel Rives LLP 1978 partner Stoel Rives LLP 1984 to February 2002 Stoel Rives LLP chairman July 1999 to February 2002. Director ESCO Corporation Director Columbus Foods Director LLC Director Little Red Services, Inc. Director National Frozen Foods Corporation Director New Seasons Market Director Northland Transportation Company Director Tidewater Holdings, Inc. Director, SnapNames.com, Inc.1998-Present Director, Golden Northwest Aluminum Holding Company, Inc.2002-Present Director, Chairman of Nominating & Corporate Governance Committee and Member of Compensation Committee Columbia2003-Present Director, Chairman of Nominating & Governance Committee and Member of Audit Committee ESCO Corporation2003-N/A Director OVISO Manufacturing Concord, Inc. Sarah A. Bany xxxvxxxvi Total Calculated Compensation$161,988 Background: Daughter of Gertrude Boyles Board of Directors since 1988 2001, \co-owner of Moonstruck Chocolate Company, Executive Vice President of Brand Development 1979 -1998,Columbia Sportswear Company, Director of Retail Stores 5/2/2013 Page 13 of 94

Andy Bryant xxxviixxxviii Total: $7,246,300 Background: Columbia sportswear Director, 2005 1981 as Controller for the Commercial Memory Systems Operation Chief Financial Officer in February 1994 Senior Vice President in January 1999 Chief Financial and Enterprise Services Officer1999 Chief Administrative Officer 2007 Ford Motor Company Chrysler Corporation. Board of Directors of Synopsys, Inc. 1999 2005 Kryptiq Corporation and McKesson Corporation Director of Creative at Red Bee Media Limited. Chief Administrative Officer of Intel Corporation2007-2012 Executive Vice President of Technology, Manufacturing & Enterprise Services of Intel Corporation, 2009-2012 Executive Chairman, Intel Corporation Prior, Convera Corp. Director, Kryptiq Corporation 1999-N/A, Former Director, Synopsys Inc. 2005-Present, Director, Member of Audit Committee and Member of Nominating & Corporate Governance Committee, Columbia Sportswear Company 2008-Present, Director, Chairman of Finance Committee and Member of Audit Committee, McKesson Corporation *Data is at least as current as the most recent Definitive Proxy Edward S. George xxxixxl Compensation: $192,701 Background: President and Chief Executive Officer of Torrey Pines from 1980 to 1990 Columbia Sportswear Co. since 1989 banking industry1991 to 1998, financial Consultant Director of First National Bank of San Diego until its sale in September 200 Director of Columbia Sportswear Company since 1989. Director, Chairman of Audit Committee and Member of Nominating & Corporate Governance Committee, audit committee financial expert., Columbia Sportswear Company Walter T. Klenz xlixlii Compensation:$183,418 Background: 5/2/2013 Page 14 of 94

Managing Director of Fosters Group Ltd & Foster's Wine Estates since 2001 Former Director and Director of America West Holdings Corporation, America West Airlines LLC 1996-N/A, Former Chairman of the Board, Chief Executive Officer and President, Beringer Wine Estates Holdings, Inc. 1998-N/A, Former Director, Member of Compensation & Human Resources Committee and Member of Corporate Governance Committee, US Airways Group, Inc. 2000-Present, Director, Member of Nominating & Corporate Governance Committee and Member of Compensation Committee, Columbia Sportswear Company 2005-Present, Director, Member of Audit Committee and Member of Nominating, Compensation and Corporate Governance Committee, Vintage Wine Trust Inc. America West Airlines LLC Beringer Wine Estates Holdings, Inc. US Airways Group, Inc. Foster's Group Ltd. Treasury Wine Estates Americas Company Tulane University Vintage Wine Trust Inc. Ron E. Nelson xliiixliv Total compensation: $150,681 Background: Vice President of NIKE, Inc. from 1982 to 1997. Joined NIKE, Inc. in 1976 president of NIKEs Japanese subsidiary from 1995 to 1997 2011-Present, Director and Member of Audit Committee, Columbia Sportswear Company John W. Stanton xlvxlvi Total compensation: $282,599 Columia Sportswear , 1997 Former Chairman, Growth Technologies International, Inc. Co-Founder, Chief Executive Officer, Partner, and Chairman, Trilogy Equity Partners Director, Firethorn Holdings LLC Co-Founder and Chairman, Trilogy International Partners, LLC 1988-N/A, Former Director, Interpoint Corp. 1989-Present, Director, Member of Audit Committee and Member of Nominating & Corporate Governance Committee, Advanced Digital Information Corporation 1990-N/A, Former Director, Member of Compensation Committee and Member of Audit Committee, Lin Broadcasting Corp. 1992-N/A, Former Chairman of the Board and Chief Executive Officer, Western Wireless Corporation 1997-Present, Director, Member of Audit Committee and Member of Nominating & Corporate Governance Committee, Columbia Sportswear Company 5/2/2013 Page 15 of 94

1998-N/A, Former Chairman of the Board, T-Mobile USA Inc. 2000-Present, Chairman and Chief Executive Officer, Omnipoint Corporation 2000-N/A, Former Director, 360networks, Inc. 2004-Present,Independent Non Executive Director and Member of Audit Committee, Hutchison Telecommunications International Ltd. 2006-2007, Former Director, Alltel Corporation 2008-N/A, Former Director and Member of Audit Committee, Clearwire Corporation Prior to Reverse Merger with WiMax.com Broadband Solutions, Inc. 2008-Present, Executive Chairman and Chairman of Strategic Committee, Clearwire Corporation

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Products and Services For visuals see appendix

Brand Portfolio:1.

Columbia Sportswear :xlvii

Colombia cloths are aimed at the upper middle class, families with children who enjoy winter sport, such as skiing and snowboarding. This trend is made apparent by the extensive children and toddler lines. Making causal winter sports comfortable, and appeasing enthusiasts alike. This line is functional fashion, bright colors, and unique patterns, tailored to flatter. It is apparent that while marketing for this line highlights functionality, the target audience would not need survival level equipment. The accessories available are targeted for everyday use; day away rolling bags, and school ready backpacks. The gear portrays that this line is not meant for the daring adventurers survival; rather the common Man's comfort in his modest outdoor pursuits.

Technology: Omni-Heat Reflective Make Your Own Heat Omni-Heat Electric Heat on Demand Omni-Freeze Ice Sweat Activated Cooling Omni-Freeze Advanced Cooling Insect Blocker Keep Bugs at Bay Omni-Shield Blood 'n Guts Resist and Release Blood and Guts Techlite Lightweight Performance Omni-Grip Advanced Traction

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Fluidpost & Fluidframe Smooth Transition and Stability Outdry Water Not Included Omni-Wind Block Breathable Windproof

Omni-Dry Ultrabreathable Waterproof Omni-Tech Waterproof Breathable Omni-Shield Advanced Repellency Omni-Wick Evap Wicking Accelerated Omni-Wick Advanced Evaporation Omni-Shade Sun Protectio see patent analysis

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2. Mountain HardwearxlviiiIt is obviously apparent that unlike the flag ship brand, Mountain Hardware is based on utility, rather than fashion. There is a proud link that states shop alpine climbing, which perfectly illustrates the audience this brand is for. Weather proof pants, base layers and coats designed for survival in the most extreme conditions are marketed here. As well and all the other survival gear you may need, such as tents and rock-climbing accessories. There are a wide variety of tents ranging from Bivvies (a sort of sleeping bag cover) to high altitude mountaineering shelters, which in fact look more like plastic igloos than tents and are cable of providing shelter for months in the worst conditions.

3. SorelxlixHigh end, yet functional, Sorel is the meeting of fashion and utility. This line is renowned for their durability and functionality. From the fashion forward water proof boots, to stylish loafers, to the well-designed childrens line; these products are well crafted and alluring, securing their marketability. This brand has considerable brand loyalty that will ensure their security in the future.

4. Montrail:Create and deliver the best fitting high-performance, and high quality footwear for outdoor and endurance enthusiasts.l Montrial is a brand meant for those who like to enjoy their outdoor activity closer to home, the joggers and park walkers. These shoes are for those who require shoes that will last them through a marathon or 10 marathons. Naturally there is high pressure from other brands, namely NIKE, for the serious sneaker wearing consumer.

5.Pacific TrailThe casual enjoyment of the outdoors li For casual wear to water gear, Pacific Trial is a family centered brand aimed at making clothes that will survive outdoor tomfoolery. To fully prepare all comfort conscious families, on their summer expeditions. This brand has a strong childrens line and their own jackets. This diversity should help them remain stable in the long term.

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Marketing activities and trendsMarketinglii:

Summary: The proceeding programs are in fact, empathy causing marketing campaigns, proudly displayed on the Columbia website. The fully represent the tactic where one convinces their consumer that in purchasing unnecessary or frivolous products, they are in fact contributing to a better world, as opposed to treating themselvesliii. Far more effective than pop-up ads in my personal opinion, although these too are utilized on popular sites such as Pandoraliv. Values & Membership: We Encourage: Reduce Reuse Recycle Purchasing Recycled Chemical Reduction Energy Conservation Outdoor Industry Association: Eco Working Group., Bargaining group to greater impact on environmental issues. Environment and Product Safety Committees in American apparel and footwear association: sharing expertise and best practices.lv Women's Rights:

HERproject: Sex-ed for adults (manufacturing workers); 60% increase in the number of prenatal medical visits among workers as well as a 41% increase in knowledge of STD symptoms.lvi 2009, 100 KW grid-tied solar electric system, 70 photovoltaic (PV) on Headquarters building, reduce carbon impact 2,002 in 25 yrs. Our Rivergate Distribution Center implemented an Energy Management System that reduced conveyor belt energy usage by 23%. The Energy Management System consists of two projects; 1) installing programming logic code to enable sleep mode for conveyor belts , and 2) installing Variable Frequency Drives (VFD) Our Computerized Lighting Control Management System at Headquarters shuts off lights when not in use, including after hours, weekends and holidays. Portland Flagship and Seattle stores LEED citified for5/2/2013 Page 20 of 94

EnergyManagement:

Material conservation:

Retail Commercial Interiors Certification. Outlet stores, energy-efficient lighting 2010, print release system at Headquarters, decreases traditional print waste and default to double-sided printing Our Restricted Substance List (RSL) To protect workers, the environment and consumers from harmful substances. Comprehensive up-to-date RSL and require our suppliers to comply with these principles. Techlite Manufacturing process 5-10% EVA , conventional 3040% waste. Water-Based Adhesives Chemical solvent-based adhesives emit Volatile Organic Compounds (VOCs) Water-based adhesives virtually eliminate emission of VOCs. Perimeter Stitch Technology Perimeter Stitch Technology is a method of stitching an EVA midsole to the shoe upper, reduces the use of adhesives by almost half, reduction of VOCs. Recycled Polyester Processing polyester synthetic fiber from recycled materials instead of petroleum decreases the need to mine non-renewable resources. Color-Core Synthetic fabric dying process that uses 80% less water than conventional dying processes.

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Trends: Production costs, and material costs are raising, squeezing profit margins of retailers across the market.lvii In the new dynamic shift efficient production secrets will be more coveted as the race to do more with less is rejuvenated.

Remarkable consumer appetite for nonessential high priced items dispute market weakness, at least in relation to high technology clothing like Under Amor and Columbia, will be extremely beneficial. lviii While high priced high fashion is facing a fall off, the economy has not spurred the interest in utility provided by higher quality sportswear.

Consumer protection after wake of the Supreme Court decisions in Concepcion and WalMart. The gender discrimination suit against Wal-Mart was overruled. Conception trial of false advertising on free cell phones was ruled out of order; least there is a violation of law caused by the misconceptionlix. California's Proposition 65 consumer warning law: Resulting with a suit involving fashion accessories. Adding to the raising importance of testing, as plaintiffs' counsel continue to target the fashion industry. Payment methods are diversifying gift cards, credit cards, and mobile payment systems. Dodd-Frank may potentially the force to impact, responsible consumer credit lines lx. Insurance coverage and indemnification to cover these risks, including mitigating potential risks created by franchisees and third-party vendors lxi

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Operations/CapacitiesSummary: Columbia is a truly global company. Their growth is substantial; with strong plans to expand. Their success is based on patents for innovative, functional fabrics and brand loyalty. Most other operations are externalized, and this leads to both high liquidity and vulnerability. Supply Chain: Inbound logistics Accounting:lxii Externalized: Deloitte & Touche LLP independent registered public accounting firm for Columbia Sportswear Co.

Production:lxiii Externalized: Products produced to company specifications by independent manufacturers located in 15 countries. (not US) Vietnam and China accounting for approximately 67% of 2008 apparel production footwear manufactured in three countries, China and Vietnam 99% of 2008 footwear production.

Production:lxiv Externalized: Products produced to company specifications by independent manufacturers located in 15 countries. (not US) Vietnam and China accounting for approximately 67% of 2008 apparel production footwear manufactured in three countries, China and Vietnam 99% of

Operations: Employment:lxv 5/2/2013 Page 23 of 94

December 31: 3,163 full-time employees 1,737 in United States 985 in Asia 320 in Europe 121 in Canada.

Sales and Marketing: Stores are generally stand alone in larger communities, as opposed to a mall presence. While their locations are international, they are not as numerous as one would expect from such a large brand name.

Their strength is the reach of online retailer: Available in fallowing languages and countries, where customers can directly order

Out bound logistics: 1.48 Billion annual sales 2011lxvi Profit $77 million, or $2.26 per sharelxvii 2009 profit $67 million, or $1.97 per share, $1.2 billion saleslxviii Human resources: Employment:lxix December 31: 3,163 full-time employees 1,737 in United States 985 in Asia 320 in Europe 121 in Canada. Headquarters: 14375 NW Science Park Drive Portland, Oregon 97229-5418 United States Phone: 503-985-4000 5/2/2013 Page 24 of 94

Fax: 503-985-5800

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StrategiesSummary: As out lined in their annual investor report, the company has a few key strategies for the following year, namely further innovation in fabrics and a marketing campaign to young fashion forward women. Product differentiation and brand diversity are historic strategies they wish to continue. Columbia also has a lucrative policy of out sourcing their production to the lowest bidder, allowing for increase liquidly.

Inspire brand loyalty: Product differentiation to match their near exorbitant prices, a casual line. Highlighted in their 2012 letter to investors, they seem to be angling the product line to be supported by fashionistas, to support the brand with their spending habits Hands off manufacturing: Innovation of fabrics in the US within company. Manufacturing at the lowest price, by independent companies; generally abroad. Sales through independent stores. Dividing names brands to target different markets * (see product analysis) Diversification came about by the purchasing of smaller companies. The result in a strong diverse consumer base where tough clothing from innovative fabrics, are not only applicable but adored.

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General Financial PerformanceSummary: Sales in 2011, were 1.48 billion; up from 1.2 billion in 2009. This translates into a stock value increase of $4 in the last 4 years despite economic uncertainties lxx. Second quarter earning show that revenues are up from 2011; $290.4 compared to $268.0 million. lxxi

Basic Stock Informationlxxii Market Cap. (Mil) $ Shares Out (Mil) Float (Mil)Share Related information provided by MorningStar, Inc.

1,831.54 33.80 12.26

Financials of skiing Costs of skiing: Skiing pass: $450 adult, $250 Child Skis: $1,000 to $600 a pair Columbia jackets: $400 Adult $200 Child Columbia base layer: $100 Top $75 Bottom Columbia snow pants: $ 200 Adult $100 Child Total costs for a family of four: $7,200 Key competitors for Columbia Sportswear: Under Armour: Sportswear Market leaderlxxiii

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NIKE Sports shoe Market leaderlxxiv Jeep : The allure of buying into winter sports may not be as tempting for families as it once was. For the outdoor appreciating family there are now generous incentives to use their limited budget elsewhere, instead purchasing an American made outdoor friendly car. Jeep: Cost:27,695 Recommended 20% down payment: $5,539

Steady increase in sales, and Stock Value. lxxv

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Current Events & Recent Key eventsDate: August 7th 2012 Event: Announced that it intended to expand brand sales in China.lxxvi Introduced Omni-Freeze Zero Active Cooling Technology at Outdoor Retailer Summer Market trade show.lxxvii

July 31st 2012

July 26th 2012

Second quarter earnings: Consolidated net sales increased 8 percent to $290.4 million, compared with second quarter 2011 net sales of $268.0 million. Net loss totaled $7.9 million, or $(0.23) per diluted share, compared with second quarter 2011 net loss of $13.6 million, or $(0.40) per diluted share. Fiscal 2012 outlook anticipates sales growth of up to 1 percent and operating margin (including a $4.0 million pre-tax first quarter restructuring charge) comparable to fiscal 2011. The board of directors approved a quarterly dividend of $0.22 per share, payable on August 30, 2012 to shareholders of record on August 16, 2012. lxxviii

January 27 2011

New record high for sales, $ 1.48 Billion. lxxix

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Porters 4 Corners model:

Future Goals: Current strategy: Expansion of Brand to new Markets Acquisition of smaller popular brands Further product differentiation Innovative materials Market to new consumers Assembled in the most cost effective environment

Response Profile: Likely to expand into developing markets. Looking to attract more devoted consumer fallowing. Vulnerabilities: dependent on independent manufactures maintaining their price advantage Assumptions: Capabilities: The Boyle family will remain united in all goals. Timothy P. Boyle will inherit company with no opposition from his sister Sarah A. Bany. Assumes that it will continue to make innovative products and discoveries, at competitive rate to market. Innovation at competitive rates Competitive pricing High functioning products Marketing Expansive distribution network High liquidity

Executive summary: Colombia seeks to continue the increase in sales it has shown in the last few years despite the fragility of the economic climate. This will require an expansion of the consumer base. This endeavor will be achieved in a number of manners; expanding to new markets, such as China; 5/2/2013 Page 31 of 94

new marketing initiatives, acquiring brands to attract previously uninterested parties. The risk steams from these processes reliance on a greater investment; this may be offset by the already low amount of money tied up in the manufacturing.

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Future goals: Columbias near-future goals are to expand by appealing to new consumer bases; including a more devout consumer base, domestically, fashionistas, or new markets entirely in developing economies. The slowly recuperating economy will impede these endeavors to some degree, but the record setting success of the last two years is reassuring.

Current strategy: Columbia strategies focus on fortifying sales in an uncertain economy. To accomplish this goal Columbia is focusing on remarketing their brand to a devout consumers as well as expanding market base by entering developing economies.

Assumptions: The current cooperation at Colombia Sportswear, may prove to be a serious vulnerability. Should their ever be infighting in the Boyle family, it would prove detrimental to the company, considering their considerable influence on the company. Columbia Sportswear is supported by their patents, should they become unable or tardy in their innovations, they company would solely rely of on their consumer loyalty. This strengthens the importance of differentiating their product.

Capabilities: Colombias strength are centered in their competitive prices, to maintain this advantage means ensuring the production remains efficient and able to adapt to the continual pressures of the market. To accomplish this will require reinvesting in research at all levels of production.

Analytical Confidence: Analytical confidence in this estimate report is Moderate. This is due to the lack of expertise of the analyst and the high reliability of the sources.

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STEEP:Macro-environmental Analysis

STEEP Analysis Matrix of the United States

SocialDecline of status symbols on innovation Value loyalty marketing

TechnologicalSpecialized Marketing and Technology Alternate Purchasing Options

EcologicalEndlife of Products Energy Management

EconomicFood & Gas Price Increases Unemployment Below 8%

PoliticalNo Preference to US Products China as expanding consumer market Resent legislation on consumer protections

Niche style Marketing vs. Broad fashion

Mobile point of sales

Workers rights

The instability of debt inducing consumer habits

S: Social Decline of high priced status symbols in a depressed economys effect on Innovation and its hefty budget.lxxx lxxxi The profitability of innovation may be declining, as the production cost may not be able to be reclaimed in sales. Status symbols dont resonate well in hard economic times.

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Implications: The high price of Columbia wear is due to the research and production costs of the advanced fabrics, this may work to difference them from the high priced fashion brands, that do poorly in this economic climate. High value should be placed on Loyalty Marketinglxxxii Emotional links with customers so that frivolous purchases will seem like necessities. Columbia is ahead of the curve, empathy causing marketing campaigns, proudly displayed on their website. The fully represent the tactic where one convinces their consumer that in purchasing unnecessary or frivolous products, they are in fact contributing to a better world, as opposed to treating themselves lxxxiii. Implications: The product is now specialized, this strong bond with a niche of consumers may alienate others, but could create loyal buyers who could caring the brand through tough economic times. Niche style Marketing vs. Board Fashionlxxxiv This information age is all about options, this can be clearly seen in the retail world. Companies separate themselves from their competitors by marketing certain styles. People want cloths that arent one size fit all clothing. They prefer diversity and options. The NIKE design your own sneaker has been very popular. Implications: Perhaps Columbia should consider allowing consumers to add their own touch to their modest and highly functional products.

T: Technology:5/2/2013 Page 35 of 94

Specialized Marketing Social media and business:lxxxv: Social media is merging business with costumers allowing for feedback and update on your favorite brands. Costumer service has redefined in the internet age, one on one chats on the website, have made the solutions to any query by a consumer instantaneous.lxxxvi The increase of technology has allowed business to directly reach their consumers, phone apps is one of these methods. Companies can design short games, or in the case of NIKE workout aids, that advertise you brands. lxxxvii Personalized marketing is gathering the information of an individuals internet preferences Implications: Perhaps Columbia should consider developing an app, a skiing gameperhaps, to further propel their relevance with the younger generation. Alternate Purchasing Optionslxxxix xc Online shopping is rising in popularity, disputed negative predictions of the last decade. Implications: As this is a raising trend, continuing to expand their online services maybe beneficial; especially if there are negative consequences still to be felt from the economic stagnation. Mobile point of sales (PoS) tech patented in 2004xci xcii; the credit card reader that is compatible with a smart phone. 5/2/2013 Page 36 of 94lxxxviii

It has seen positive results at Apple stores; costumers feel more comfortable only having to deal with one person.xciii

Implications: This may be applicable to the many of Columbias lines, having one expert guide to through the process of getting everything youll need for a ski trip or an expedition, may be the sort of edge to further differentiate the product.

E: Ecological: Endlife of productxciv Companies are focusing on the end life of their product. Gap has a trade in policy for their jeans; then they recycle the denimxcv. environmental differentiation marketing Our clothes are environmentally constructed, but what will eco-conscientiously minded consumers feel about the disposal of our synthetic products? Implications: Perhaps the development of an endlife program would be beneficial to maintaining the environmentally conscientious image, that has been so strong portrayed in our marketing campaign.

Energy management xcvi Businessweek announces the trend in energy management, for marketing and economic conservation purposesxcvii.

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Trends toward solar energy, energy management systems; env. protect and government incentives, global standardized certificate for energy

Ahead of the curve: 100 KW grid-tied solar electric system, Headquarters building Rivergate Distribution Center, Energy Management System Computerized Lighting Control Management System, Headquarters Portland Flagship and Seattle stores LEED citified for Retail Commercial Interiors Certification. Outlet stores, energy-efficient lighting

Implications: As there is a raising trend, perhaps it would be prevalent to advertise not only the ongoing Environmental project, but how long the company has been supporting environmental efforts. If there were any way to expand the ongoing projects Workers rights Raise social awareness/empathy for the treatment of workers

A few day after launch Apples I pad mini is facing a crippling law suit over the abuse of Laborersxcviii

HERprojectxcix: Education for female workers regarding womens health.

Implications: In tough economic times consumers look for cheaper goods, and thus the responsibility and blame for the quality of life of the labors that make the consumers products, falls to the company. Where in strong economic times, consumer would simply change brands, if they had an ethical dilemma with production. 5/2/2013 Page 38 of 94

E: Economic: Food and Gas Prices raising IMF says prices are rising globally affecting the ability of some to maintain their quality of life, far more dangerous to othersc Food and gas prices are not considered in the inflation equation, thus the cost of living is rising. American standard of living dropping.ci Implications: Columbia has already adopted extensive material conservation polices, in the name of their environmental platform (see marketing). Expanding these practices may have an economic benefit if material costs continue to raise. Unemployment down below 8% for the first time sence the great recession cii This is a landmark for the recovery of the American economy. This increases the numbers of potential consumers.

Implications: This progress if continued would continue to increase already recode high sales. If so the revenues may be able to counteract the raising material costs. The Instability of Debt including consumers habit: US citizens are spending more are unnecessary items than Germany, this will cause debt and less spending in futureciii Implications:

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Encouraging smart spending habits, such as layaways with monetary payments, for large preaches, will allow the fiscally responsible customers to purchase items guilt free, and the enthusiast to purchase items without negatively affects their ability to purchase items in the future.

P: Political: No preference to US productsciv Tough economic times, lead people to want the least expensive options despite nationalist tendencies. Implications Columbias strategy to manufacture cheaply overseas will be beneficial in this climate, and may raise revenues. China as expanding as Consumer Market cv China is shift for 4th to 5th gen leadership, who want to open them up economically.cvi Implications This is a large vastly untapped market, while Columbias internet relator is already active in the region in may be in the companys best interest to expand the presence in the country. Resent rulings on costumer protections: California's Proposition 65 consumer warning law: Resulting with a suit involving fashion accessories. Adding to the raising importance of testing, as plaintiffs' counsel continue to target the fashion industry. Dodd-Frankcvii

Implications: 5/2/2013 Page 40 of 94

Corporations have to be very careful in this economic climate, warning lables should be use when there is the slightest possibility of confusion, products should be tested for safety thoroughly and Brands should be aware that they are going to be treated with distrust.

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Patent analysis:Key points: Other companies will buy technology they cant produce but can afford because theyre bigger, so predicting their lines will be predicting their purchases. Columbia Technology is efficient but not flashy; there is no obvious way to illustrate the research that went into the garment visually. Serious warm-weather athletes is a untapped market by the Columbia lines.

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Coldblackcviiicix:US patent: 79058430 Publication Date: 7/28/2009 Assignee: SCHOELLER TECHNOLOGIES AG Abstract: Coldblack technology, which enables dark-colored fabrics to reflect rather than absorb the sun's rays, offers dual protection from solar heat and ultraviolet (UV) rays. According to Schoeller and Clariant, textiles treated with Coldblack reflect up to 80 percent of heat rays and are guaranteed to offer a minimum UV protection factor of 30. The technology is bluesign approved and meets Oeko-Tex Standard 100, class I-IV requirements. Implications: Used by Under Amour, in their warm weather line. A source of revenue from serious summer athletes a market Columbia has no hold in. This market would include most colligate athletes, and may be a profitable investment; however entrance into the market would not be easy.

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GarmentcxUS patent: US20120210487A1 Publication Date: Aug 23, 2012 Assignee: Nike, Inc. Inventor: Shaun Albin Abstract:

A garment may be formed from a stretchable material. Various portions of the garment may contain imprinted ink. Elasticity of the garment fabric is reduced in the regions onto which the ink has been printed, thereby providing a support and/or a feeling of support to certain muscles and/or muscle groups. Implications: Specialized pattern is a bold fashion statement, which means brand recognition. Columbia products are modest in their designs, so where one purchased their garments will not be apparent. We must also take into consideration the claim of advance utility, if this design really causes, improved comfort and mobility in may prove to be a strong seller in the long run. However just the fact that it looks like it is specially made will attract consumer, who want to appear specialized.

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Layered Thermoplastic Non-Woven Textile ElementscxiUS patent: US20120227282A1 Publication Date: Sep 13, 2012 Assignee: Nike, Inc. Inventor: Bhupesh Dua Abstract:

A layered non-woven textile may be incorporated into various products, including apparel. The layered non-woven textile may be formed from a first layer and a second layer. The first layer is formed from a plurality of first filaments that include a first thermoplastic polymer material with a first melting temperature. The second layer is located adjacent to the first layer and secured to the first layer. The second layer is formed from plurality of second filaments that include a second thermoplastic polymer material with a second melting temperature. The first melting temperature is lower than the second melting temperature. Implications: The no weave textile element above, are key in NIKE wears warm weather sport line. If there was movement to enter such a field there would be a need to replace such a process.

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Cellulosic Substrates with reduced absorbent capacity having the capabilitycxiiUS patent: 7008887 Publication Date: Mar 7, 2006 Assignee: Cotton Incorporated Inventor: William A. Rearick Abstract: The present invention relates to cellulosic substrates with reduced absorbent capacity having the capability to wick liquids, as well as to methods of manufacturing such cellulosic substrates. The cellulosic substrates provided by the present invention comprise an inside and an outside connected to the inside. The inside comprises cellulosic fibers and has a reduced absorbent capacity, and the outside comprises cellulosic fibers. The outside may have a reduced absorbent capacity and may have an absorbent capacity higher than the inside. The cellulosic substrate is capable of wicking liquid contacting the inside of the substrate to the outside of the substrate. Implications: Used by NIKE is their warm weather clothing, to help dry you in the heat. This would be non-applicable to winter sports as cotton doesnt function well in cold weather. However it is a natural fiber, as Columbia markets to the environmentally minded, adding a line of less effective natural fibers may be beneficial.

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Temperature responsive smart textilecxiiiUS patent: 8187984 Publication Date: May 29, 2012 Assignee: Malden Mills Industries, Inc. Inventor: Moshe Rock Abstract: A textile fabric includes a smooth surface with one or more regions having coating material exhibiting thermal expansion or contraction in response to change in temperature, adjusting insulation performance of the textile fabric in response to ambient conditions. Implications: This patent could be a defining addition to Columbia products, to have transitionary gear for hot and cold weather.

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Waterproof moisture-permeable underwear and waterproof moisture-permeable linercxiv

US patent: US20120227164 A1 Publication Date: Sep 13, 2012 Inventor: Noriko Komoriya Abstract: Disclosed is waterproof moisture-permeable underwear by which the scope of choices for a material can be widened, and the waterproofness in junction areas can be improved so that staining of an outer garment with urine or menstrual blood leaked from undergarment can be surely prevented. A waterproof moisture-permeable underwear to be worn between undergarment and the outer garment worn on the lower body is constructed by joining a plurality of two-layered fabric pieces (A), each comprising a base fabric (B) disposed facing the undergarment and a waterproof moisture-permeable membrane (C) laminated on a surface of the base fabric (B) facing the outer garment, in junction areas; wherein a material superior to the membrane (C) in texture is selected for the base fabric (B); a material superior to the base fabric (B) in welding property is selected for the membrane (C); and the junction areas (21A-21F) are formed by welding. Implications: This is a newly produced patent, no parent company in looking to put this into product. This could be a lucrative acquisition, should the base layer produced be more effective than our own lines, or simply to keep this technology off the market.

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Heat management systemUS patent: 20120074128 Assignee: Columbia Sportswear North America, Inc. Inventor: Blackford, Michael E. "Woody" Abstract: Embodiments disclosed herein relate generally to the field of outerwear, and more particularly to a heat management system configured to provide heat to one or more predetermined regions or zones, such as the upper or lower body, torso, chest, back, neck, arms, shoulders, wrists/cuffs, hands, fingers, feet, toes, and the like. In various embodiments, these heating zones may be controlled by an actuator switch and control electronics that may allow individual heating zones to be actuated alone or in combination, and in some embodiments, in a predetermined sequence. Some embodiments of the actuator switch may include color-coded lighting elements that may indicate the current temperature, zone activation, heating program, and the like. Implications: This will further supplement our brands renowned functionality. It is especially important because such designs are not commonly see in the market and it will set us apart when consumers go to purchase coats.

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Holographic Patterned Heat Management MaterialcxvUS patent: 20110203783 Publication Date: August 25, 2011 Assignee: Columbia Sportswear North America, Inc. Inventor: Abstract: Blackford, Michael E. "Woody", Mergy, Jeffrey

Currently, heat reflective materials such as aluminum and mylar typically take the form of a unitary solid film that is glued or otherwise attached to the interior of a garment, such as a jacket. The purpose of this layer is to inhibit thermal radiation by reflecting the body heat of the wearer and thereby keeping the garment wearer warm in colder conditions. However, these heat reflective linings do not transfer moisture vapor or allow air passage, thus they trap moisture near the body. Because the application of a heat reflective material impedes the breathability and other functions of the underlying base fabric, use of heat reflective materials during physical activity causes the inside of a garment to become wet, thereby causing discomfort and accelerating heat loss due to the increased heat conductivity inherent in wet materials. Further, these heat reflective coated materials impair the ability of the material to stretch, drape, or hang in a desired fashion. Implications: This is the technology behind OMNI-HEAT. This product is marketed as a thinner jacket to prevent overheating, while the dots retained, reuse and reflect your body heat back at you. This is our strongest point in brand recognition at the moment. It only becomes apparent when the jacket is removed, but the metallic dots are notoriously noticeable.

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Zoned Functional FabricscxviUS patent: 20120015155 Publication Date: January 19, 2012 Assignee: Columbia Sportswear North America, Inc. Inventor: Abstract: Blackford, Michael E. "Woody, Mergy, Jeffrey

Embodiments of the present disclosure relate generally to body gear having designed performance characteristics, and in particular to methods and apparatuses that utilize an array of performance characteristic elements coupled to a base material to direct heat, absorb heat, emit heat, and/or wick moisture while also maintaining the desired transfer properties of the base material. In some embodiments, two, three, four, or more performance characteristic elements may be included in a piece of body gear, for example in desired zones of the body gear. Implications: The process of applying all the Columbia Sportswear innovational fabrics in to designs, while maintaining their trademarked qualities.

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Financial Ratio AnalysisTrend: Activity/Efficiency Asset turnover ratio: Sales(revenue) Total assets Average Inventory Investment Period: Current Inventory Balance Average daily costs of goods sold= (COGS/360) Accounts receivable: Accounts Receivable Sales (Revenue) Leverage/Solvency Debt to equity: Total debt (long+short) Total stockholder's equity Debt to assets: Total debt (long+short) Total Assets 14.00% 13.00% 11.00% 14.00% 13.00% 10.00% 0.22 0.21 0.17 78 Days 77 Days 65 Days 7.02 6.33 3.22 2011 2010 2009

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Company profile: Columbia Liquidity: Current Ratio: current assets total current liabilities 3.9:1 3.9:1 5.1:1

Acid-test Ratio: cash+ short term investments+ net current receivables Total current liabilities Profitability: (%) Return on assets: Net income Assets Return on equity: Net income Shareholder's equity Profit Margin Ratio: Net Income Sales (revenue) Capital market / Shareholders return: Earnings per share (ESP): (Net income-dividends on preferred stock) Average outstanding shares

1.4:1

2.0:1

2.9:1

9.80%

7.70%

7.20%

9.60%

7.60%

6.70%

14.07%

12.23%

12.78%

$1.08

$0.77

$0.68

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Company profile: Columbia Project earnings, P/E Ratio: Current market value per share earnings per share (ESP) $15.36 $26.98 $19.82

Executive Summary: It appears that Columbia is taking large financial risks. The numbers above show stagnate growth; however Columbia is pulling in record high sales. Showing that stagnation of accumulative growth, is in fact active reinvestment, and has been very profitable. Illustrating that investment can be worth the risk.

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Company profile: Columbia Activity/Efficiency

Asset turnover ratio: This figure illustrates how well a business uses its assets to generate sales. The higher the number of the ratio, the more efficient the company is at this. A decline in efficacy would represent overinvestment in company assets. This is trending positive, indicating that efficiency with our investment in plants, equipment and other developmental costs. Maintaining Colombias low investment strategy in manufacturing, would allow this number to remain positive.

Average Inventory Investment Period: This number represents the number of days before out flow can be converted to sales. Lower numbers represent less time and thus money invested into a project. The rise in number here, is a rise in the cost and the length of time money is tied up. This circles back to the fact the current investments are effecting the availability of revenue.

Accounts receivable: This illustrates the percentage of sales that still needs to be used to pay off short term loans. The lower the number the more money may be kept, and utilized for other projects. This number shows the increase payment time for sales, this may be due to the large increase in sales and the inability for the current structure to absorb the immediate costs. This means that the revenue unfortunate percent of revenue is money that cannot be used elsewhere.

Implications: It seems that Columbia has weighed the scales in their favor. While it takes investment longer to be repaid and they are holding on to short term loans longer, it seems the have found a system to become consistently more effect in raising the amount sales they can receive for every dollar spend. Its no wonder they are breaking records for sales.

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Company profile: Columbia Leverage/Solvency

Debt to equity: The raising in numbers illustrates and increase in debt. Columbia is accumulating more long and short term debt. This development is a product of their reinvestment in their procedures, namely development and marketing.

Debt to assets: This shows the percent of the company financed by creditors. Increase of this percentage of instability for the company. However anything below the 50% line is seen as satisfactory because the debt could be paid out right in case of emergency. The level is rising, but still far below the 50% line. This risk in still moderate and proving to be very profitable.

Implications: Debt is not necessarily a sign on financial frailty; rather it can be a sign of taking calculated risks to propel the development of the company. As I would propose is this case, given the drastic increase in sales.

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Company profile: Columbia Liquidity

Current Ratio: Assent over liabilities, illustrating how much you have versus how much you own, above 2:1 is seen as minimally healthy, below 1:1 will be unable to pay off debt if everything was liquidated. Despite the negative trend in this field we are still more than able to pay off our debt, and far from to 2:1 marker. This illustrates that all risks taken by immediate strategies are manageable.

Acid-test Ratio: This ratio measures highly liquid assets over debts. A 1:1 ratio is seen as minimally satisfactory. This ratio is negative trend, getting close to bench mark of 1:1. This figure is rather worrisome, the ratio equaling 1:1 would result in a great vulnerability, that our immediate resources would be depleted should the investments fail.

Implications: Debt is increasing as the companys ability to pay off debt is decreasing. It is possible this could be because of the percentage increase of debt over sales, echoing in other figures. If not, it is a troubling sign of financial gaps in the system that has been bringing in such great sales.

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Company profile: Columbia Profitability:

Return on assets: This is the percentage measure how well a company unitizes its assets to product revenue. Raising number indicate how well we are utilizing our assets for profitability. This reflects on the success of our investments and their efficiency.

Return on equity: This ratio illustrates the returns a company provides for its investors. Positive trend measure the increase in returns. This measures the increase effectiveness of the investments we pursue. There is an increase in the profitability of the investments we have chosen as compared to previous years.

Profit Margin Ratio: This number show the percentage of profit made on the sales of an item. In other words profit verses the cost of production. We are increasing the amount of profit we make on every $1 of sales.

Implications: Columbia Sportswear is making more money on every dollar spent. This increase in efficacy is especially relevant because of the increase in debt; it shows the strong possibility of the debt being easily paid off.

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Company profile: Columbia Capital market / Shareholders return:

Earnings per share (ESP): This ratio shows increase in value of each share. Positive trends show increased profitability of investment. This means that the companys value has risen, and has been reflected as holding greater value in the market. Which is reflected in the individual shares.

Project earnings, P/E Ratio: This ratio indicates the market price of one dollars of earnings. Lower projections show uncertainty in continued success. The critiques and analysts are uncertain of the continued success of the company.

Implications: The stock holders will be very pleased with the steady increase in value of their respective investments. However the estimated growth of the company has leveled off so is not likely that this trend will continue.

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Strategy ModelsA. 9 forces model: Entrants: No Threat: Entrance price to market is high No Threat: Marketing and establishi ng brand costly

Suppliers: No Threat: Wide range of suppliers available

Substitutes: Low Threat: Substitutes can mimic look but not performanc e

Buyers: Low Threat: Long standing brand loyalty

Rivalry: Low threat: Concentration, because of market growth, may be growing now that China is opening up High Threat: Switching costs are low Low threat: Diversity of products, range of target market

Political: Low Threat: Consumer protection No Threat: Elections effect on

Economic: Threat: Stagnated growth of economy Threat: Inflation of material

Technology: Low Threat: Online retailers Low Threat: Customizati on/ Micro-

Social: Low Threat: Social networking to reach customers

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Company profile: Columbia business prices Threat: Unemploym ent Marketing No Threat: Automated retail machines (gloves at ski lodges)

No Threat, Low threat, Threat, High threat

Exec summary:Columbias highest threat comes from competition; the appeal of another brand is very dangerous due to switching costs being nonexistent and Columbia products often being sold at retailers that carry other brands.

Discussion:Substitutes:Low Threat: Substitutes can mimic appearance but not performance. This is protected continued innovation to be functionally superior to competition.

Buyers:Low Threat: Long standing brand loyalty, reflected in high sales during recession. TO maintain these levels new consumers must be reached.

Rivalry:Low threat: Concentration is now dispersing due to market growth. Largely untapped consumer markets are now opening up, including China. This will allow for market wide growth, and first mover opportunities. High Threat: Switching costs are nonexistent, the whim and preference of the consumer dictates the sale. Maintaining sales means communing with consumers, building brand loyalty, and confidence in the functionality of the brand. Low threat: Diversity of products offered by Colombia Sportswear is wide ranging from, casual camping gear, to skiing preparation, to arctic survival; however Colombia 5/2/2013 Page 61 of 94

Company profile: Columbia has neglected to design a line for serious warm weather athletes. Warm weather athletes are target market unreached by Columbia Sportswear, but occupied by their competitors, NIKE, and Under Armor. When branching out into new market it may be profitable to also expand to this audience.

Political:Low Threat: In retaliation to the recession, consumer protections have been out lined in the Dodd-Frank reforms, pertaining to all markets. The problem it presents for Colombia Sportswear and other retailers is that, should a company choose to provide short term credit to consumers, they are now solely responsible for losses. This makes this traditionally profitable venture very dangerous for the company. cxvii

Economic:Threat: Stagnated growth of economy will impede general consumer spending. This may affect the growth of sales, sales being reliant on loyal customers. Threat: Inflation of material prices, will raise the cost of production, this will affect Colombias profitability. Columbia invests larger amounts into development, this is counteracted by their low cost production; increasing material costs will shrink the profit margin of their products. Threat: Unemployment limits the number of consumers in any given market. Given high unemployment a market will shrink. To counteract this one must expand their clientele, attract new audiences, or enter new markets.

Technology:Low Threat: Columbia Sportswear makes a large percentage of their sales through their online distributor. This makes cooperating online distributors a larger threat, because switching costs are not only nonexistent but technology has allowed switching time to be greatly diminished as well. Low Threat: Customization/ Micro-Marketing is a way to target only the audiences that are interested in your products, as gather by search history. Expanding this marketing to though not only researching Columbia products but also though interested in the product of our competitor may aid in expanding our customer base.

Social:Low Threat: Social networking to reach customers is not a marketing source Columbia has taken full advantage of, despite their presence on Facebook. cxviii Expanding the interactive presence in social media may attract younger consumers. 5/2/2013 Page 62 of 94


A. SWOT Helpful Internal origin I.Innovationi.Function ii.Differentiation

HarmfulI.Dependent

on Boyle

familyi.Leadership ii.Dependant I.Reduced

I.Out sourced productioni.High liquidity ii.Free to invest

liquidity from Research costsi.High-end items unappealing in recession ii.Lower liquidity

I.Diverse boardi.Able and willing to change company ii.Diverse views available

I.Increased debti.Increase liability ii.Lower Liquidity

External Origin

I.Market expansioni.Developing economies ii.New consumer bases

I.Under Armor brand loyalty, first movers advantagei.Refer to base layers as under armor

I.Consumer loyaltyi.Raising sales ii.Maintaining in recession I.Extreme

I.Stagnant economic growthi.Impedes general spending ii.unemployment

Weathercxix

i.Survival gear popular

I.Material costs risingi.Development costs

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Exec summary: Market factors are varied factors, Columbia is well equippedto handle them as seen by their success over the past few years, however if they wish to remain successful they must remain flexible. Reassessing current strategies to better fit the current market in necessary.

Harmful:Dependent on Boyle family: This leader ship of this company will not be decided by skill but by blood. While this doesnt seem to be a problem at the moment it may provide issues in the future. The Bolye family still owns 60% of Columbia sportswear, and thus dominates any ruling of investors this may impede other voices from being heard in the company. Reduced liquidity from research costs: High-end items resonate poorly in depressed economies this may have untoward consequences on Columbia Sportswear. The cooperation will have to reassess what amount of investment into research will be most profit le. Increased debt: This steams from increased investment but holds the negative consequences of, increased liability, and lower liquidity. This impedes others investments, and the ability of the company to move quickly. Under Armor brand loyalty: This Brand holds the first movers advantage in the cold weather athletics. Base layers are commonly referred to as Under Armor. This affects the first response of the consumer when purchasing an item. Stagnant economic growth: The recession impedes general spending, which means that sales are reliant on consumer loyalty. Without intervention this would stagnate, sales and prevent growth within markets. The number of consumers within a market may be declining as well. As unemployment rises the number of consumers available in a given market shrinks. Material costs rising: This will affect the low cost development strategy that Columbia Sportswear has been implementing. This pressure on their profit margin will demand efficiency.5/2/2013 Page 64 of 94


Helpful:Innovation: Columbia has been constantly at the forefront of material innovation this history inspires consumer loyalty. The differentiation of their products is made possible by their strong history of functionality. Outsourced production: This strategy allows for low cost production, which rises the profit margin of the products. Outsourcing production allows for high liquidity, meaning fast transactions and the freedom to invest. Diverse board: The range of opinions and specializations that can be found on this board allow for a fluid presentation of ideas. This flexibility enables change and efficiency in navigating market fluctuations. Market expansion: Many developing markets are opening as consumer markets including China. This expansion in to new consumer bases will allow for expansion. New consumer bases will offset any, stagnated sales growth. Consumer loyalty: Colombia Sportswear has a long history especially in the Skiing world, fortifying their consumer loyalty. The continuously rising sales illustrates the advantage of such a following. Extreme Weather: The major storms of the last few years including Hurricane Sandy have incited a larger consumer base for survival gear. This will be beneficial for lines such as Mountain Hardware; if they advertise to take advantage of the situation.cxx

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A. Growth Vector Matrix

Product

Present

New

MarketProduct Development Market Development

Present

3. Innovative materials

1. Redefining the brand through advertising (Pandora mobile, ect)

Market Penetration

New

2.Mmarketing to foreign consumers

1st Priority 2nd Priority

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Executive summary: Columbias priorities in maintaining their market relevance arediverse. If they must ensure that they are able to redefine their brand to their current market to ensure that sales remain high. The next priority will be to expand their customer base further by entering new markets. Lastly Columbia must remain vigilant in their pursuit to be at the forefront of functional innovations.

Present Product in Existing Market: Columbias strength as a company is relianton the functionality of their products. This advantage must be maintained by continued innovation at competitive speeds and patenting said information efficiently. Innovativematerials are evolving at an exponential rate cxxi. To maintain market relevance Columbia must continuously expand their investment in research and development, or exponentially match the efficiency to the competitive market.

Present Product in New Market: Columbia Sportswear will be branching out intodeveloping markets to expand their clientele. Advertising to Chinese consumers will mean market penetration but, may product a loyal consumer base. This will ensure the rate of sales will continue to rise, allowing for the company to generate more revenue to support other important endeavors.

New Product in Present Market: Redefining the brand in established markets in themost important venture because it will provide an active consumer base to maintain sales through tough economic times. To reach the younger consumer base this advertising strategy will have to be based online and through social median, expanding the initiatives already seen on sights like Pandora, or Facebook. This will allow the company to invest in other initiative to expand the company to continue their success.

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Key Findings & Strategic ImplicationsSources Key Finding Implications for Colombia Sportswear Co.

PRIORITY: A HIGHEST IMPACTStrategy Models

1. Market developmentMarketing and Trends

Redefining the brand through advertising

Strategy Models

2. Market PenetrationMarketing and Trends

Expanding into new markets

Value Chain 3. Innovation & Development Patent analysis Strategy Models

Competing through superior functionality and assessing that strategies profitability in this market.

Financial analysis 4. Stagnant Economic Growth STEEP PRIORITY B: MEDIUM IMPACT Strategy Models 5. Rising Material costs STEEP Value Chain This may affect the Profit margin of products, making the reallocation of revenue to product development difficult. May cause reduction in sales if prolonged.

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Company profile: Columbia Sources Key Finding Patent Analysis 6. Product Diversity Portfolio Strategy models Implications for Colombia Sportswear Co.

Expanding or reforming product lines may help attract new clients.

7. Cooperate liquidity & Investments

Financial Analysis

Asses what risks the company is comfortable taking, and what investments will be most profitable in this economy.

PRIORITY C: LOW IMPACT Financial Analysis 8. Low-Investment Production Value chain Out soured Production allows for a high profit margin, this practice may become less effective with rising material costs and stagnated economy.

9. Leadership Diversity

Portfolio Analysis

Flexibility to navigator fluctuating economic times, should recognized as a strength and harnessed for future use.

Strategy Model

10. Consumer layaltiy

History and Back ground Marketing and Trends

This area needs to be expanded and strengthened. However all chances made to attract new costumers should be made with the existent following in mind.

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AppendixBrand Portfolio:

Columbia Sportswear :cxxiiMen & Women's Apparel:

Jackets

Fleece

Skirts and dresses

Shirts

Baselayer

Bags

Pants

Shorts

Footwear

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Kid's:

Boys

Toddler

Girls

Baby

Equipment:The gear portrays the fact that this line is not meant for the daring adventurers survival; rather the common Man's comfort in his modest outdoor pursuits. Tents (only model, 2 sizes) Rollers & Duffels

Bags & Backpacks

Sleeping bags

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Mountain HardwearcxxiiiTents: Expedition : High altitude Mountaineering Super light: Light weight Backpacking

Backpacking: Backpacking & Trekking

Camp: Roomy & durable

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Accessories: Footprints, Gear Lofts, Stakes & Anchors Gloves Hats and belts

Men &Women's apparel:: Jackets: Shells Soft Shells Fleece Insulated Active Lifestyle

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Vest

Tops

Fleece Long sleeve Short Sleeve

Bottoms

Shells Soft Shells Insulated Lifestyle Shorts Run

Sleeping bags: Below 0 Degrees:

Backpacks: Climbing and Sport Day Packs Duffel and Luggage

5-20 Degrees >20 Degrees kids Bivvies:

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For questions or comments please contact author: Pia Frascatore 203-561-9894 [email protected]

Thank you

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i

Columbias annual sales hit new record - Portland Business Journal. (n.d.). Retrieved October 18, 2012, from

http://www.bizjournals.com/portland/news/2011/01/27/columbias-annual-sales-hit-new-record.html?page=all

ii

(n.d.). Retrieved October 18, 2012, from http://www.shareholder.com/visitors/DynamicDoc/document.cfm?

DocumentID=3026&CompanyID=COLM&zid=ed0392bc

iii

Gertrude Boyle: Executive Profile & Biography - Businessweek. (n.d.). Retrieved October 16, 2012, from

http://investing.businessweek.com/research/stocks/people/person.asp? personId=384302&ticker=COLM&previousCapId=384300&previousTitle=COLUMBIA%20SPORTSWEAR %20CO

iv

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from http://www.marketwatch.com/story/apparel-sellers-face-new-pricing-pressures-2012-02-24

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(n.d.). Retrieved October 18, 2012, from http://www.shareholder.com/visitors/DynamicDoc/document.cfm?

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Columbia Sportswear Company - Investor FAQs. (n.d.). Retrieved October 17, 2012, from

http://investor.columbia.com/faq.cfm?faqid=2

x



xi



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xiii



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xv



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COLM Company Profile - Columbia Sportswear Co. Company Information. (n.d.). Retrieved October 18,

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Columbia Sportswear | Tim Boyle, President and Chief Executive Officer. (n.d.). Retrieved October 17, 2012,

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%20CO

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Columbia Sportswear | Gert Boyle, Chairman of the Board. (n.d.). Retrieved October 17, 2012, from

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xxix

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xxxviii

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%20CO

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xlvii

Columbia Sportswear | Shop Direct for Jackets, Pants, Shirts & Shoes. (n.d.). Retrieved October 18, 2012,

from http://www.columbia.com/on/demandware.store/Sites-Columbia_US-Site/default/Default-Start

xlviii

Mountain Hardwear | Shop Jackets, Clothing, Tents, Sleeping Bags & Backpacks. (n.d.). Retrieved October

18, 2012, from http://www.mountainhardwear.com/on/demandware.store/Sites-MountainHardwear_USSite/default/Default-Start? mid=paidsearch&nid=Brand_Other_Website&oid=Brand_Website_General&did=mountain %20hardwear.com&gclid=CMfguZiiibMCFREx4AodrDEAnQ

xlix

SOREL | Shop Womens, Mens & Kids Boots, Shoes and Footwear. (n.d.). Retrieved October 18, 2012, from

http://www.sorel.com/

l

Montrail Shoes, Hiking Boots, Sandals - Zappos.com. (n.d.). Retrieved November 2, 2012, from

http://www.zappos.com/montrail

li

Whats New | Pacific Trail. (n.d.). Retrieved November 2, 2012, from http://www.pacifictrail.com/whats-

new.php

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http://www.columbia.com/Environmental-CorporateResponsibility/Corp_Responsibility_Environmental,default,pg.html

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liv

http://www.pandora.com/

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http://www.columbia.com/corporate-responsibility/About_U

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