DORE DORE

Doré Doré was a French company, famous all over the world for fashionable knitted products. It had evolved from the 1800s Doré Society, which was founded by Jean Baptiste who suggested to his neighbours who like himself made hand-knit hosiery to pool their resources and produce together in order to earn better profits. Its Hosiery division produced socks and stockings for men, women and children; its knitwear division produced a line of children’s clothing knitwear such as playclothes, sweaters and nightclothes. The Hosiery division accounted for 88% of DD’s sales. Doré Doré focused on the high end of its markets with regard to both quality and fashion. It not only produced hose under its trademark DD but also for famous fashion houses like Yves St.Laurent, Nina Ricci, and Chantal de Thomas.

The differentiating factors of Doré Doré were its quality manifested in exclusive yarns like cotton lisle, silk and fine wool; stringent quality control; wide range of sizes; double reinforcement of heels and toes; invisible seams and impeccable fit. It differentiated also by making different calf sizes for men and women.

The high-end segment represented only 5% of the total French hosiery market but DD commanded about 30%-40% of this market. Overall it represented 4% - 5% of the French Hosiery market but only 0.5% of the children’s knitwear segment. Exports comprised 35% of the company’s total sales.

Doré Doré’s operation was divided among two main plants; Troyes produced the children’s knitwear and the Grès plant produced the Hosiery. One quarter of the total Hosiery was produced at the main Grès plant and the rest in 11 family-run knitting shops around the plant. Each season Doré Doré produced each of its hosiery style in two campaigns; the first batch was produced when hardly any retailers had placed any orders and after getting the initial market feedback the next batch was produced accordingly.

Even with the two campaign system the demand was uncertain and this led to high inventory costs as hosiery was produced before knowing the actual demands of the end-users. The demand forecasts which were primarily made by veteran sales representatives and production coordinators from their experience and intuition, was further complicated by Doré Doré’s fashion focus. This made the popularity of different styles highly unpredictable, even successful items enjoyed only short periods of popularity. The hosiery division’s experience during the previous two year had exemplified the problem of demand forecasting. While an unusually hot onset of spring and summer pushed the demand of the hosiery down, the thus adjusted production led to a shortage of hosiery due to a much cooler weather.

François Marguet, the newly appointed Director of Operations was asked by the company’s PDG to look into different problems and find a fresh perspective to deal with them. Some of the problems were: rising

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