el Group was lagging at year ended 1998, even with a restructuring charge on Liz Claibornes income statement, 1999 was a different story. Huge growth at Jones lead to revenues double of that one year ago while Liz, while increasing, was quickly falling behind. The growth for both of these companies continued into the year ended 2000, but Jones Apparel Groups results were brilliant compared to Liz Claibornes. One billion dollar growth in revenues as well as higher net income is making Jones Apparel Group the company of the future.I. The DuPont Framework and Return on Equity (1996-2000)From the chart above we can see that Jones Apparel Group has surpassed Liz Claiborne in profitability four out of the last five years. Standing out among the profitability figures is Jones year ended 1998, in which the company eclipsed Lizs profitability by over 2.5 percent. Jones profitability slipped substantially from year ended 1998 to 1999, from 9.19 percent to 5.98 percent. During Liz Claibornes same relative period, the companys profitability fell only one tenth of a percent, from 6.68 percent to 6.58 percent. However, Jones Apparel Group battled back in year ended 2000 posting 7.29 percent profitability, as compared to Lizs 5.95 percent figure, a differential of more than one and one-third of a percent. While these differences may seem quite arbitrary, Jones total revenues year ended 2000 were $ 4.14 billion compared to Liz Claibornes $ 3.10 billion. Net incomes for Jones and Liz were $ 301.9 million and $ 184.6 respectively. With dollar amounts this large, every hundredth of a percent counts.Looking at the raw dollar amounts, it would seem foolish not to say that Jones Apparel Group has the comparative advantage in profitability. But that just wouldnt be fitting to the apparel industry. More than any other, the fashion industry so closely parallels legalized gambling. Apparel giants like Jones and Liz pay designers top dollar t...
