Deckers Group Project

Deckers Outdoor Corporation is interested in improving its environmental performance by promoting the greening of the facilities in China where its products are assembled.  This study presents an internal business plan to analyze the financial benefits to Deckers for an initiative to improve the environmental performance of the manufacturing facilities.  

Deckers’ costs for this initiative include staff salary and overhead, communications, and membership fees.  The two main sources of benefits to Deckers are risk reduction and positive consumer response. The opportunities for risk reduction can be classified as preempting regulations, increasing the certainty of resource availability, and avoiding negative public perception of Deckers. Positive consumer response can be seen if consumers are more likely to buy, recommend, or pay more for Deckers’ products due to greener manufacturing facilities in China.  Among the benefits, we quantified the avoided losses Deckers can see from decreasing risk of a loss in profit resulting from negative consumer response to an environmental problem.  Over five years, an investment in the initiative will return $3.50 to $20 in avoided losses for every $1 spent. 

To facilitate Deckers’ implementation of this initiative, we created a Facility Audit and a Green Facility Recommendations Handbook, which includes new construction renderings to illustrate an ideal green manufacturing facility. We applied these tools to a specific facility in Hebei, China.  Based on the results of the case study, we developed suggestions for the facility to improve its environmental performance.