Since its founding in 1984, Fossil has grown into a global company and a world class brand in the fashion accessory industry. The core of the company is its watch division, which sells more than 500 styles in its line. They boast they have a watch for every wrist. Fossil also manufactures and markets sunglasses, belts, purses, and other related leather goods. The key to Fossil’s success is its emphasis on fashion-forward design, creative packaging, and a distinctive marketing campaign that depicts the nostalgia of 1950s America. Every watch comes in a free collectible tin box reminiscent of that period. Its products are not retro, but their brand image is. This image is the heartbeat of the company, and Fossil believes its brand image gives it a differential advantage versus competitors such as Guess and Swatch.

1. What comparative advantage, if any, does Fossil have over its competitors?
2. If Brazil devaluated its currency by 50 percent, what effect would it have on Fossil?
3. Given that Fossil is not marketed in every country in the world, would you recommend that the company license its products to expand its presence in additional countries where it is not currently represented?