Case Study | Supreme & VF Corp | VF Corp Looking for Potential Buyers for Supreme

VF Corp, with annual sales of $11 billion and ownership of brands like Vans, Timberland, and The North Face, has hired Goldman Sachs to explore potential buyers for Supreme, which it acquired for $2.1 billion in 2020. Despite being known as the "Chanel of streetwear," Supreme reported decreased revenue in the financial year ending March 2023, with $523.1 million against projections of $600 million. This drop, along with high valuation and brand equity stretching thin, led S&P to downgrade VF Corp's rating to A- from A. VF Corp has a history of active portfolio management, including spinning off brands like Lee and Wrangler in 2019. The post discusses how Supreme's deviation from its scarcity-driven business model has affected its cool factor and contributed to these financial challenges.

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