Patagonia is a manufacturer and retailer of outdoor clothing, technical apparel and gear that is noted internationally for its commitment to product quality and environmental activism, including environmental responsibility in product development such as its policy of using 100% organic cotton.
The store will carry a wide selection of Patagonia-branded outdoor clothing, technical apparel, footwear and children’s clothing.  Items will range from layering systems to keep wearers warm and dry to specific products for sports such as rock climbing, skiing, fly fishing and paddling.
 
Channel conflict can be a concern for brands and manufacturer’s online stores when they essentially compete with their retail partners for sales. But Patagonia takes a co-opetition approach, tying its catalog to its retail partner inventories. When an item is not in-stock at Patagonia’s online store, Patagonia checks inventory of its resellers and refers customers if it can find the item in-stock.
If it’s possible the item is in-stock at one of Patagonia’s retail stores, the customer is shown the customer service number and offered free ground shipping as a courtesy if the item is available. When the item cannot be located through a retail partner, the customer is notified.This also suggests that finding it elsewhere will be difficult. Adding a link to the product’s category or similar item cross-sells would help to change the opinion of the disappointed customer.
Patagonia’s approach is win-win-win situation. When customers can locate products easily, it boosts the likelihood they will buy that item (which is in the manufacturer’s best interest). Also, the customer is likely to come back to Patagonia first next time, knowing that if Patagonia doesn’t have the item in stock they will do their best to find an in-stock item. Retail partners of course benefit from a sale and are more likely to continue to stock the manufacturer’s items. The service is also available for back-ordered items. And even for in-stock items, which helps customers who may participate in loyalty programs like Moosejaw Rewards.

1. Outline and briefly explain costs associated with aggregate planning. Which costs has the greatest bearing upon this case study ?